For a new business idea, when should you seek a venture capitalist?

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djbaxter

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If You Have a Great Business Idea, Who Ya Gonna Call? Hint: Not a VC
by Andrew Broadbent, Entrepreneur.com
September 19, 2018
If you have the next billion dollar startup business idea that is going to change, even revolutionize, an industry, what is your next step? Should you:
I've often seen people on Quora saying, I have this great business idea; how should I approach potential investors? Whom can I speak with about my idea?

One of the answers to that question, which was up-voted, caught my eye. That commentator wrote, “Talk to your ‘potential’ consumers or your target audience." Potential consumers, the writer pointed out, will help you:
  • Understand your idea better
  • Find mistakes and areas of improvement
  • Evaluate customer interest and willingness to pay
  • Understand market potential and size
  • Understand the buyer persona better
Why you shouldn't talk to a venture capitalist first
VCs are not your first call. In fact, I would not recommend at all that you talk to a VC at the outset about your nascent business idea -- and not because the VC will steal your precious concept or not fund your "idea" since it's just that -- an idea.

Instead, recognize that you have things to do before you talk to VCs about your idea. “For as long as humanly possible, avoid investors as best you can," advises customer development expert Bob Dorf, who founded seven companies and co-authored The Startup Owner’s Manual with Steve Blank.

“Life is much better," Dorf continued, "if you spend all that early energy to build something that will attract the interest of investors -- rather than going and knocking on a hundred doors.”
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