Should you raise money or bootstrap?  (By bootstrap, I actually mean raise < $250k from individuals / angels).

Having run a startup that raised money and now in running a VC, ironically, if I were starting a product company today, I would start out with the mentality of bootstrapping for as long as I could.  And, maybe, just maybe, I might consider raising more money under a few limited circumstances.

I would raise more than $250k if I had a company that:

1) Was growing 30%+ MoM in sales and my operations could not keep up to fulfill those sales

I’ve noticed for operationally-heavier companies (i.e. not SaaS businesses but generally tech enabled services or alike), it can be easy to grow your sales quickly, but often these companies need to throttle their growth, because they do not have enough people to fulfill these services.

2) Was a marketplace with high engagement

Marketplaces tend to be “winner take all” businesses, because they are only valuable if both the supply and demand sides are both liquid and efficient.  And, this happens when you have a lot of supply and demand, which means to really thrive, you need to be willing to invest in a land-grab on both sides.

http://blog.elizabethyin.com/post/179189593325/should-you-raise-money-or-bootstrap