Sunday, 25th February 2018

In Search of Funding—East vs. West

Posted on 13. Apr, 2011 by in Blogs

Local entrepreneurs got the skinny on what it takes to get funded at Seed Stage Capital Outlook 2011, yesterday morning’s Potomac Techwire breakfast roundtable. Two panels—one with funders and one with entrepreneurs—generously shared their time and expertise with those of us engaged in the hunt for money.

The panels provided invaluable (and sometimes contradictory) insight. There’s too much to share in one posting, so we’ll focus on the top 10 tips from each group starting with the entrepreneurs today. They advised:

  1. Focus on creating a business, not on raising capital.
  2. Get good lawyers (and accountants) who understand how startups work.
  3. Make sure your spouse is on board (or if unmarried, have a support structure) because it’s going to be a long ride.
  4. Your idea is just an idea unless you execute. You have to show action and results before someone will open their wallet.
  5. Go out and build it. Don’t wait for funding to get started.
  6. Working on a shoestring forces you to be creative, and you can do a lot more than you know. (You’ll also be working on a shoestring more than you think.)
  7. Spend a fair amount of time looking at new media and traditional media outlets. Get to know these people and share your story.
  8. Start early and have every conversation you can with angels and Venture Capitalists (VCs). It takes a while to get to know them and when you take funds, they become your partners. You’ll want to choose wisely.
  9. Be passionate about what you’re working on and focus on the one thing you really care about.
  10. Get used to the word ‘no’… and don’t give up.

Oh, and there’s one other gem. It’s 10x harder to be an entrepreneur and get funding in the Metro DC area than it is in San Francisco. West coast funds invest 10 times the money and have a well-established network that can support entrepreneurs in many other ways. And they do.

At the end of the day, VCs on the east coast tend to be more conservative and want to see performance, then revenue. First, they’ll ask you to come back after you’ve built the product. Next, they’ll ask you to come back after you have customers. Then, they’ll ask you to come back after you’ve generated some revenue. By then your needs for funding may have changed.

On the west coast, investors want to know how big the space is and whether your team will be able to execute. There’s a higher tolerance for risk—although you still have to focus on building a business. Test, iterate, fail. Test, iterate, succeed. This appears to be the expected approach, and there seems to be an understanding that failure breeds innovation.

Perhaps the difference between east and west is also grounded in a general attitude about people. The room got a little chilly when one of the funders panelists proclaimed that entrepreneurs are “commodities.”

Daniel Odio, co-founder and CEO of PointAbout, Inc. offered the following counterpoint. “The entrepreneur is a very special driver and really is the core of the value chain because s/he creates something from nothing.”

Daniel hit the bulls-eye. A company’s value flows directly from the quality of its people, which starts at inception. The quality of leadership and whom you have on board in every role determines how well you’ll execute, which in turn is your source of differentiation and, ultimately, market success. So how, then, can a successful entrepreneur be a commodity? The local funders need to reconsider the source of value creation.

Thank you to the sponsors and panelists for staging an informative discussion. These events make an incredible difference to the entrepreneurs, professional services providers, and investors in the Metro DC area.

In fact, the information provided today validates the experience we’ve had with our own startup. We recently began looking for funding in San Francisco. As a community we need to think of the brain drain that happens when startups leave the Metro DC area. We’re losing a vibrant part of our local economy. So, if we don’t like hearing that startups are moving west to where funding is more favorable, then we can choose to change that dynamic one startup at a time.

Tune in tomorrow for the top 10 ‘must haves’ from the funders’ perspective. You’ll find their advice equally enlightening.

Post By Marcia Moran (314 Posts)

Marcia Moran

Marcia Moran

Marcia Moran helps organizations reimagine what’s possible and provides the framework for clients to achieve stellar, long-term results.

As a Performance Architect, Marcia uses the principles discovered through neuroleadership and positive psychology to deliberately design the employee experience and corporate culture. Blended with pragmatic systems design, these elements free people to play to their strengths while reducing strife in the workplace. As a result, people can push beyond their known limits as individuals, as teams, and as companies.

Marcia is also the Vice President of Marketing for Intelishift, a colocation company with operations in Ashburn, VA and Silicon Valley. Prior to moving to the Metro DC area, she worked as a business consultant for Up ‘N Running and advised startups and small businesses in the areas of management, operations, and marketing.

Marcia earned an MBA from Chapman University. She loves to travel, speaks Norwegian, and unwinds by kayaking and painting landscapes. Marcia recently co-founded Positive Business DC with Shannon Polly and Donna Hemmert. Positive Business DC provides resources to help people increase the levels of well-being in the workplace and at home.

Website: → Performance Architect


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to “In Search of Funding—East vs. West”

  1. marcia_moran 14 April 2011 at 8:05 am #

    Thanks for the clarification, Jay. I reviewed the video on Daniel Odio’s site. It was actually Robert Rosenbaum who started the discussion on entrepreneurs being commodities at about 25-1/2 minutes in.

  2. marcia_moran 13 April 2011 at 8:34 pm #


    It was Robert Rosenbaum who made the commodities comment. If you’d like to view a video of the roundtable in its entirety, Daniel Odio has it posted to his blog at (Cliff Notes on Raising Your First $1 Million through AngelList.)

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