Raising money for your business can be great. Many entrepreneurs see it as validation that they’ve “made it.” While it is a good sign that a professional investor has kicked the tires on your company and is willing to invest their money, there are some downsides to venture capital that might mean that raising venture funds is not the right path for you.
Sure, there are many advantages of securing a round of investment from a “value-add” partner. It can open the doors to important introductions, kick-start a business into high growth, and even refocus a business for success. But not all venture funding stories have such happy endings. There are, in fact, times when a business might encounter more negatives than positives when accepting venture funds.
To avoid this path, there are potential scenarios in which venture capital is a major drawback:
Dispatches From The Front 