As funding is drying up in D.C., startup founders are getting restless and angry. Unfunded or underfunded founders are whining about the state of funding in Greater Washington.
People keep complaining that D.C. is the most difficult town in the world to raise money. It’s like we’re the new New York, because if you can make it here, you can make it anywhere.
Here’s what I don’t get. It would be much easier for startups to be successful if a day was 40 hours or 90 hours long. Think about the amount of stuff they could get done in a day. Yet you don’t hear anyone complaining about the fact that a day is only 24 hour longs. They don’t complain because it’s a fact of life.
Well guess what? Here’s a fact of life. D.C. is not Silicon Valley. We are not Massachusetts and we are not New York. It is a fact that we are D.C. It is a fact that we have fewer VCs, fewer angel investors and less money available. So complaining about that fact is no different than complaining about the lack of extra hours in a 24 hour day.
This lack of funding is an endemic problem of our startup ecosystem. Okay I get it, it is an immutable fact that D.C. is woefully lacking in startup risk capital. Why not complain that working is work and that gasoline should be free, and that traffic sucks. Okay maybe complaining about traffic is justified.
So when these unhappy founders are confronted with facts, the argument gets shifted. When confronted with the facts an these unhappy founders than shift the conversation to misdirected capital. I hear things like, “there are good ideas that don’t get funded while there are bad ideas that do. Investors here are stupid.”
Wow! Yes I'm a stupid investor but if you want my money, it is your job to educate me and make me smarter. It may be true that I invest in stupid ideas while taking passes on good ideas. It may be true or it may be that:
1. You view your ugly baby startup like a proud parent who doesn’t see the resemblance between their baby and a Shar Pei.
2. The worse idea that I funded outsold you. You were beat. Maybe I invested in a better team and I believe that in most cases a strong team beats a good product.
Now here’s the problem with that. Founders have all their eggs in one startup basket. It is devastating to you when investors take a pass on your baby. To investors your devastation is just s a blip on our radar. Investors take a portfolio approach. I like 99 percent of the other startup investors in America didn’t invest in Google, or Microsoft or GE. But our portfolios moves on.
To investors, good startups are like busses. If we miss one, it's okay because another one will be by in 15 minutes.
These are the facts of life. What D.C. is, is what D.C. is. You can complain and whine about it like a petulant child or you can acknowledge the facts and do something about it.
You have a few simple choices.
1. Continue to whine and get nowhere.
2. Move to Silicon Valley and make it or fail there.
3. Give up
4. Or deal with it.
© 2013 American City Business Journals, Inc.