Teach Me to be a Successful Entrepreneur While I Stand on One Foot

If you follow these two rules your business venture-- I promise-- you will be successful:

Rule #1: Don't run out of money.

Rule #2: Don't be greedy with your equity.

The root of every business failure 100% of the time lies in the breaking of one or both of these two rules... the rest really is commentary.  I've never heard of a venture failure that did not boil down to breaking one of these two very simple rules.  The solution to almost any business problem lies in these two rules as well, if you think hard enough about it.   As a VC and an entrepreneur, they guide me almost everyday. 

PS. Credit is due to this famous story on the ancient religious Golden Rule for inspiring this blog.  Credit is also due to Cliff Schorer for taking me under his wing after I got out of business school and giving me this advise on my first venture.  Thank you!

Comments

[sparrow]

I disagree. ALWAYS be greedy with the equity. If you are selling equity, educate yourself on FMV and don't be an ass, but don't be a sucker, either. In my experience--as a VC an entrepreneur--terms mean more more than valuation when it comes to VC deals. Avoid double dip deals; TRY to limit negative control rights; resists vesting; etcetera. Best of all: AVOID VC.

[Agree with Sparrow]

Don't be greedy with equity? That's the most absurd thing I've heard. Look at Qualcomm. Do you think Dr. Jacobs was handing out equity in order to get it off the ground?
Do you work for or with VCs? Because that sounds like a VC thing to say and I hate it when VCs say that shit. It's their standard line in order to convince an entrepreneur to give them an inordinate amount of equity for a little bit of cash. But now, capital is a commodity and so are the VCs! And it doesn't cost much to start a company these days! Death to VCs!!!