As always, there are a lot of sides to this question.
Being a hardware geek, having enough funding is even more critical for a successful launch. Typically, hardware gadgets tend to cost more to design and develop than software products. And in most cases, you and/or your team can often get your software MVP developed much cheaper. Even your Seed and Series A will require more funding for a hardware product to ensure that your first prototypes will be completed. Then you also have unforeseen road blocks as well. We sure never saw the first huge dot-com crash coming in 2001/2002 after we got our first prototypes finished and tested successfully for full launch. And we ended up having to shut our company down after my CFO and I spent over $500K of our own money trying to keep our employees paid while traveling across the country looking for investors. It was like searching for water in the desert.
The other balancing act is: How much equity - and control - are you willing to give away in order to survive and succeed? Of course, hindsight is generally better than foresight. I often look back on those hard times and wonder what might have happened if we'd had a cushion of capital that would have kept our company alive longer to make it to a full product launch.
These days, I continue to see this cycle repeat itself with so many often crazy ideas raising hundreds of millions of dollars for projects that make your scratch your head wondering WTF?
Still, I'm blessed to actually be re-launching my original project today with a new twist and a much larger market than we were looking at over 15 years ago. And I still find myself occasionally wondering if we're raising enough money this time.
What did we do in 2001? I led the only company that ever made PIN-based debit transactions successfully work online and we were certified by NACHA. It would have been a game changer. Imagine an Amazon having the ability to accept debit payments as an alternative to higher no-card-present credit card transactions over the years?
So here we go jumping into changing the credit card space! And trying to raise more money this time...
Robert Lee
As always, there are a lot of sides to this question.
Being a hardware geek, having enough funding is even more critical for a successful launch. Typically, hardware gadgets tend to cost more to design and develop than software products. And in most cases, you and/or your team can often get your software MVP developed much cheaper. Even your Seed and Series A will require more funding for a hardware product to ensure that your first prototypes will be completed. Then you also have unforeseen road blocks as well. We sure never saw the first huge dot-com crash coming in 2001/2002 after we got our first prototypes finished and tested successfully for full launch. And we ended up having to shut our company down after my CFO and I spent over $500K of our own money trying to keep our employees paid while traveling across the country looking for investors. It was like searching for water in the desert.
The other balancing act is: How much equity - and control - are you willing to give away in order to survive and succeed? Of course, hindsight is generally better than foresight. I often look back on those hard times and wonder what might have happened if we'd had a cushion of capital that would have kept our company alive longer to make it to a full product launch.
These days, I continue to see this cycle repeat itself with so many often crazy ideas raising hundreds of millions of dollars for projects that make your scratch your head wondering WTF?
Still, I'm blessed to actually be re-launching my original project today with a new twist and a much larger market than we were looking at over 15 years ago. And I still find myself occasionally wondering if we're raising enough money this time.
What did we do in 2001? I led the only company that ever made PIN-based debit transactions successfully work online and we were certified by NACHA. It would have been a game changer. Imagine an Amazon having the ability to accept debit payments as an alternative to higher no-card-present credit card transactions over the years?
So here we go jumping into changing the credit card space! And trying to raise more money this time...
1 Replies