To VC or not to VC

To VC or not to VC

It’s a strange irony for us at Eggfirst to be faced with the issue of ‘To VC or Not to VC’. Gives us a sense of deja vu, really. While the chicken has been laid to rest for good, let’s for now just take head-on, the VC question.

This is about a panel discussion we were attending at the Tie-World conference in California (May 16/17 ‘08). The panel on ‘To VC or Not to VC’ threw various perspectives on the issues and did a wonderful task. Salil (Bay Partners), Peter (KLM Capital) and Jasvir (Sufi) were crystal clear about possibilities and connected concerns. Ron Weismann from Apax – one of the amazing speakers on that panel, introduced Venture Incubators. The moral of the discussion was: Go to a VC ONLY if you need them. For money or any ‘other reason’. This ‘other reason’ is what we are still trying to figure out.

For instance, one important ‘other reason’ could be to seek strategic advice. Well, with the sense of supreme confidence (a.k.a. arrogance!) we have, it’s difficult to justify that as reason enough for dilution.
The next in line was a good one that really had us thinking: Access to markets. Connections. Well, though not quite new or path-breaking a thought, but yes, there’s merit in that proposition. And it may just seriously justify dilution. However, it did leave us with a set of new questions that need to be answered, to answer the first.

And hopefully some of you can shed some practical light and brighten our day: How does one ‘approach or structure’ a VC relationship proposing dilution in return for access to markets? Do the VCs bite into it? Do they find it worthwhile?

Well, it does leave us with these questions yet! Wasn’t life easier with answers being as conclusive and unavailable for comment, as the ones that Eggfirst leaves you with 🙂

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