August 17, 2013
While slow teams will die in bootstrapping period, the fast ones will die in investment period. Paradox.
A start-up is a team of people with unusually high commitment level, severely multitasking and overworking during the bootstrapping period. The motto of a start-up is You are not dead – until you are dead. Start up team is used to react quickly and use every second up to the last one – many critical issues are being solved in the last second due to team work overload and cash shortage. This behavior is critical for survival of a start up in early years. This behavior will make sure start ups talk about financing prior notifying the SEC and dont file up-dated offering materials at SEC because they have to spend all their time improving cash flow. Either you spend a day serving customers who feed the team, or filing some docs. As fast-reacting the team – as higher its chances to make it to the 1st investment round – as higher their chances to be punished by one year ban from fundraising – as lower their chances for survival.