One of my favourite reads of the week has to be the refreshingly honest article by Mick Hage, the young entrepreneur behind Zinch (basically Facebook for colleges and students), on dealing with early-stage investors and VCs.
Writing in Fortune yesterday, Hage berates investors for their mercenary attitude: “It’s like they’re playing a game of monopoly or doing some fantasy baseball trade or playing a game of poker and us entrepreneurs are just the Skittles they’re playing with,” he says.
Hage (who dropped out of Princeton to start Zinch) wants investors to understand the level of sacrifice and gut-busting hard work that goes into creating a business: “I’ve begged family members for loans… as humiliating as that is. I’ve lost a home. Do you know how hard and embarrassing that is” My credit is a complete disaster and will take years to recover.
“This hasn’t been easy. Yet to so many investors, we’re just a ‘deal’. Just a drop in the bucket. And while these investors are worried about what country club they’re gonna join next… we entrepreneurs are busting our butts and sacrificing everything trying to get the company off the ground.”
Hage tells his fellow entrepreneurs to refuse money from investors who treat you like pawns. To investors, he has one word of advice: “Care”.
“Don’t forget the blood, sweat and tears that we shed every day to make this happen. To you we’re just one investment. To us, this is everything.”
We’re betting Hage isn’t the only one who feels like this.
Readers, do you feel like a “pawn” to your shareholders/investors/bank” Who are the good guys and who are the bad guys (feel free to name and shame)” Post a comment below and share your experiences.