Do most entrepreneurs in India prefer just in time capital raising and spending ?
In my experience in Silicon Valley keeping a large capital cushion was considered quite important and after the initial proving stage, spending on say office space , key talent etc was done rapidly.
The just in time approach minimizes dilution. I guess the right strategy is situation dependent.
In China Alibaba raised $1 billion from Yahoo for 40% of the company. It seems that $750 million of that is spent. Tao Bao ( like Ebay) and AliPay ( like PayPal) are free to users and lose money to build the network.
In India I think a more conservative approach is followed though in areas like Telecom/Retail big bucks are being spent.
It will be interesting to see how this evolves.
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capital raising is best, since it allows you to plan a little ahead, the worst is always chasing the money, the CEO cannot then focus on the business, and as a startup you need to get the business correct….but the downside is if no controls are in place, then the spending usually goes out of control in the first few months, and then you hit a brick wall, since you have nothing to show for what you have spent on.
Iqbal