I’ll admit it's a tempting fantasy. The notion of coming up with an idea on the spur of the moment, turning into a startup business and then raising hundreds of millions of investor dollars at a nine-figure valuation is intoxicating. What business owner wouldn’t want that? There is an elite club of startups that are either pre-revenue or have meager sales and yet are pushing the billion-dollar valuation level.
If you happen to be one of the lucky few who are part of this club, congratulations. But if you aren’t, you run the risk of chasing that unrealistic dream instead of focusing on building a business, which should be the reason why you struck out on our own in the first place. This idea of finding the next Facebook or AirBNB or Pinterest has spread like a virus across Silicon Valley that sets unrealistic expectations among entrepreneurs and warps the process of building a real business.
Diana Kander, entrepreneur-in-residence at the Kauffman Foundation agrees that the culture of the billion-dollar startup is damaging to entrepreneurship. It shifts the focus of potential entrepreneurs away from customers and towards investors. Over the long-term, as Kander indicates, entrepreneurial success depends on building a customer base by developing products and services that meet a need at a competitive price. It doesn’t matter how much venture capital you raise; if nobody wants to buy what you are selling your business will fail.
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