Question
I'm working on a startup. The idea is well received. We need to raise money to get a functioning product. Advice on how to go about it is split in 2 camps.
Camp 1 says: "Make a revenue model and show an investor how he/she can value the company and decide what their investment is worth in terms of percentage of the venture"
Camp 2 says: "Don't bother about revenue, you'll make a barrier to users, users before revenue... get it out for free and blow up the industry"
My question is: We still need money for development, how do I decide that $X is worth %Y for the camp 2 approach.
Answer
Eyal Policar-DBA Agri-Business
The days of not having a reliable revenue model in place are fast dwindling. A few big VC companies are shutting down, angel investments are rare people are just not that keen. In many countries, people are looking for govt aids and grants.
Therefore the challenge is to define your ROI clearly.
Ask yourself if I had 1/2 a million $ to spare where would i put it. In real estate, a new start-up, an existing company stocks, govt bonds. Your answer should help you decide
Good luck- If you need more input drop a line
