Notes from NSC1: When a Web2.0 startup should seek funding

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One of the panels covered at some length the unexpected consequences of a teacher sharing her class materials; once her secret sauce was available to others, they improved it. Not a new idea to me, just a new way of putting it.

At some point in the same panel, Joi Ito briefly outlined the putative “typical” financial path for a Web2.0 startup:

  • 3 people bang out a prototype in 3 days.
  • Seek an angel when you have ~40k users and 20% month-on-month growth. The angel should be providing ~US$100K for 1* full-time salaried developer.
  • When you grow to the point of “server-stress” (I took this to mean the point where you can’t optimise your way out of needing a lot more, expensive, server capacity) talk to a VC.
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