Excerpt: Chapter Zero, Pages 47-48, from the book “The Big Jump Into Entrepreneurship” by Dr. Ramesh Ramachandra, Founder and CEO of Talent Leadership Crucible (TLC)
“Today, some tech startups are raising millions and even billions of dollars before even generating profits. Some of these companies focus on developing a pitch decks for fund-raising rather than generating revenue. For certain business models, like e-commerce platforms or med-tech/bio-tech players, this may seem like an attractive route to take, deffering the business viability question, ‘is my business model able to generate profits?’ while focusing on customer acquisition.
However, postponing viability has its cost. An example of a company that focused too much on fund-raising and ended up neglecting product development is Theranos, a defunct American health-tech unicom which was valued at US$9 billion before it was exposed to be a scam, in January 2022. Theranos’ founder Elizabeth Holmes was found guilty of it fraud charges.
When Theranos was founded in 2003, many investors were drawn in by its founder’s magnetic vision of a diagnostic machine that can conduct multiple blood tests with just a finger prick of blood using “nanotainers”. This scandal has revealed how risky and dubious the fund-raising route is.”
What will you do when you raise a significant amount of capital but have yet to truly calculate feasibility and business strategy?
#Thebigjump #Entrepreneur #Startup #TheBigJump #DrRamesh #TLC #IV”
