According to the National Venture Capital Association, 43 Venture Capital funds raised $3.4 billion in the fourth quarter of 2008, down sharply from both the previous quarter amount of $8.4 billion, and the fourth quarter of 2007 ($11.7 billion). Mark Heesen, president of the NVCA, said he expects the slowdown to continue well into 2009, until economic conditions improve, and institutional investors can “recommit with confidence.”
As winner of the Carrot Capital Education Foundation Business Plan Challenge, Tom Szaky was in position to get venture capital funding for Terracycle, a start-up business focused on the organic plant fertilizer market. However, as discussions with the firm’s potential VC backers progressed, the two sides clashed over spending priorities, the need for specific cash flow projections and milestones, and composition of the management team. As described in Canada’s “National Post”, despite having only $500 cash on hand at the time, Terracycle ultimately did not go the VC funding route, but instead was able to use the resulting PR to attract a smaller level of angel funding.
Ilana DeBare tells “San Francisco Chronicle” readers two ways that they can start a business with no cash through bootstrapping: 1) time-shifting your payables into the future, 2) bartering for services that your business can provide now in exchange for goods or services you need right away.
