Harvard Business Review highlights why venture capital might actually be detrimental to your business and highlights dilution, the distraction of fund raising and potentially poor advice as things to bear in mind.
Take Claus Moseholm, co-founder of GoViral, a Danish company created in 2005 to harness the then-emerging power of the Internet to deliver advertisers’ video content in viral fashion. Funding his company’s steady growth with the proceeds of one successful viral video campaign after another, Moseholm and his partners built GoViral into Europe’s leading platform to host and distribute such content. In 2011, GoViral was sold for $97 million, having never taken a single krone or dollar of investment capital. The business had been funded and grown entirely by its customers’ cash.