Investments · Startups

The investment paradox, how not to get stuck in it?

Vladimir Serb Co-founder & CEO Mankind Legacy Inc., partner of marketing promotion of Utopia ecosystem

Last updated on January 16th, 2021

Hello everyone, we are at the initial stage of our startup and it turns out that we are catastrophically approaching the investment paradox, which is especially felt in our CIS region. The paradox is that a startup at a very early stage relies on the rules of "FFF" (True, this is already very outdated), but the option is also applicable that doing business with friends, relatives and fools is already deliberately failed, all the more to give them any share , again, especially in the CIS (If anything, we are incorporated in the United States by the state of Delaware, just the geolocation is now in Ukraine), as well as investment funds and angels, although we already have everything ready (We also understand them, because they risk their money and want to feel that the risk is justified), but now we need pre-seed investments to develop the MVP. So the question is, how not to get caught up in this paradox? If all those who offer us investments diffuse about the risks and ask for exorbitant shares, although the same Y-Combinator gives investments and connections and contacts and experience and knowledge for only 7%. Maybe someone knows sensible connections or knows where to go purposefully in order to get around this whole paradox and not waste a lot of time in vain?

Paul Garcia marketing exec & business advisor

January 19th, 2021

Unfortunately reading your question was a waste of time. You've gotten so tangled up in buzz words and things that don't matter, what's really clear is you don't know how to communicate. That failure to communicate clearly is what is stopping you from sorting out your investment plan, not the attitude of investors. Investors are not going to place money in the hands of someone who cannot communicate in plain, clear language.

It's very simple. Investors take mitigated risks by choosing companies that have a plan to succeed without their money. Investment is meant to enhance a plan in a way that accelerates the timeline for or effect of a product, not to fund an experiment. If investors are asking for too much equity, it is because they would be holding the risks you have not taken the time to reduce.

If you want better offers, figure out how to remove or lower the risks. That's it. It's no more complicated than that.

Think about what your product would be and how you would go about launching your business if you knew today that you would never receive an outside dime. If you can still figure out how to run your business self-funded, like 90% of all companies, then you may have a chance of attracting investors to consider giving you a boost. Investors don't fund experiments. They generally share money with people who don't need it, but would generate mutual benefits with it.