It's rare for a startup to make money immediately, so you need to make sure that you have enough saved or that you have another income stream that can support you.
Sentiment: NEGATIVE
Part of the magic of a startup is the fear of death. You have only so much money in the bank, and if you don't get to the right milestone before you run out, then the company goes under - it's over.
The truth is, there are many types of businesses that require thousands of dollars to be invested during the startup period. However, there are also many different types of business models that you can run from the comfort of your own home without having to reach too deep into your wallet.
Too many startups get in the habit of continually raising more and more money, which has the deleterious effect of both pushing out profitability and limiting your exit options. The less rounds of capital you need to raise, the more of your company you get to own.
One of the most important aspects that feed a thriving economy is successful businesses, so the more startups that take off, the better the financial picture is for everyone.
Startups have finite time and resources to find product/market fit before they run out of money. Therefore startups trade off certainty for speed, adopting 'good enough decision making' and iterating and pivoting as they fail, learn, and discover their business model.
The thing about startups is you can make it, and if it's wrong you can remake it, and you can build a team that you want to have, a product that you want to have. You're utterly focused on your users or your customers and their needs, and trying to figure out how to meet those needs.
Startups are often very undercapitalised, but I found that to be very beneficial because it forces you not to throw money at problems. Instead, you learn all the nuts and bolts of what you're doing and become an expert.
I've been lucky enough to be involved in a number of great startups, including eBay and Wikia as an entrepreneur and LinkedIn and Paypal as an investor.
Landing a million-dollar investment for your startup is exhilarating. But as big as that number sounds, it doesn't go far. Many startups just getting off the ground won't have a CFO to monitor finances. It doesn't take much for spending to spiral out of control.
Most startup entrepreneurs unnecessarily spend half their time and give up half their equity in search of funding from angel investors and venture capitalists. Tens of millions of dollars are available to them for free from partners who not only don't want their equity, they don't even want to be paid back.