Many entrepreneurs believe that the only way to build a successful unicorn is through venture capital (VC) financing. They hope to attract capital, develop a great pitch, and eventually achieve wealth through VC funding. However, the reality is more nuanced, as only 6% of billion-dollar entrepreneurs actually used VC funding. The majority of successful entrepreneurs proved their venture’s potential and leadership skills before considering VC. Jeff Bezos, for example, raised capital from a group of angels to start Amazon.com before attracting VCs through rapid growth.
There are five key ways for entrepreneurs to make VCs love their venture. Understanding VC is crucial, as VCs only finance a small number of ventures each year, mainly in Silicon Valley. VCs want control and often replace the entrepreneur in a majority of VC-funded ventures. Using smart strategies to get to a leadership aha moment, developing unicorn skills, finding smarter financing options, and developing the right attitude are all essential steps to attracting VC funding.
To avoid exploitation by VCs, it is essential for entrepreneurs to delay or avoid VC funding altogether. Ninety-four percent of billion-dollar entrepreneurs achieved success without VC funding by mastering skills and developing strategies to become the driving force behind their unicorn ventures. By retaining control of their ventures, these entrepreneurs were able to safeguard their vision and keep more of the wealth created. VC may seem like a shortcut to riches, but unicorn entrepreneurship requires hard work and skill under the control of the entrepreneur.
Overall, VC funding is not the only or best way to build a successful unicorn. Many billion-dollar entrepreneurs have achieved success without VC funding by proving their venture’s potential and leadership skills before considering external funding. By mastering skills, developing smart strategies, and retaining control of their ventures, entrepreneurs can create successful unicorns without relying on VC financing. The key is to focus on developing the necessary skills and mindset to build a successful venture, rather than seeking instant wealth through external funding.
