It was late Summer of 2012 and we were out at the annual Dreamforce show in San Francisco. In addition to having a booth at the show, I was out there meeting with partners and customers. For several months prior, we had been working on a distribution relationship with a large tech company that’d I’d always liked and bought a number of laptops and computers from over the years (their name rhymes with “Smell”).
Eagerly, I went to meet with their cloud software division located in the heart of San Francisco to wrap up a distribution agreement so that their customers could buy our software on one bill with everything else they sell. We exchanged pleasantries about being in town for the big show and the partner manager laid right into me.
Partner manager: How much venture capital have you raised?
Partner manager: Why not?
Me: We don’t need it. We’re bootstrapped, north of $10M recurring, and doing great.
Partner manager: You should raise venture capital.
Me: We don’t want to.
Partner manager: You’ll grow much faster with venture capital.
Me: We’re already growing super fast.
Partner manager: Every successful software company raises venture capital.
Me: We don’t need it.
Partner manager: You’ll be a better company if you raise venture capital.
Me: I feel really good about our company.
After this exchange, I was fired up. Our company was amazing! And, here I was, being belittled for not raising venture capital. This partner manager had been so brain washed by the Silicon Valley narrative that she couldn’t appreciate that there were other paths to success.
Venture capital isn’t right for everyone. In fact, it’s wrong for 99% of entrepreneurs.
See people where they are and work to understand their position. Even if you don’t agree with them, the best thing you can do is work to leave with a strong rapport and mutual understanding.
One final note: it was all I could do to bite my tongue during this conversation with the partner manager as we’d already signed an agreement to sell our company for ~$100M, and it would be announced shortly. Just wait until she reads the announcement!