The Common Illusions and the Realities that Bust them

СПб. What prevents people from doing and confuses them is illusions. Guy Kawasaki, a managing director of Garage Technology Ventures, wrote in his weblog the top ten myths of entrepreneurship.

It takes a lot of money to finance a new business. Not true. The typical start-up only requires about $ 25,000 to get going. The successful entrepreneurs who dont believe the myth design their businesses to work with little cash. They borrow instead of paying for things. They rent instead of buy. And they turn fixed costs into variable costs by, say, paying people commissions instead of salaries.
Venture capitalists (VC) are a good place to go for start-up money. Not unless you start a computer or biotech company. Computer hardware and software, semiconductors, communication, and biotechnology account for 81% of all venture capital dollars, and 72% of the companies that got VC money over the past fifteen or so years. VCs only fund about 3,000 companies per year and only about one quarter of those companies are or start-up stage.
Most business angels are rich. If rich means being an accredited investor - a person with a net worth of more than $ 1 million - then the answer is «no. Almost three quarters of the people who provide capital to fund the start-ups of other people who are not friends, neighbors, co-workers, or family dont meet SEC accreditation requirements.
Start-ups cant be financed with debt. Actually, debt is more common than equity. According to the Federal Reserves Survey of Small Business Finances, 53% of the financing of companies that are two years old or younger comes from debt and only 47% percent comes from equity.
The growth of a start-up depends more on an entrepreneurs talent than on the business he chooses. Sorry to deflate some egos here, but the industry you choose to start your company has a huge effect on the odds that it will grow.
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Anna Chernykh, WOW-manager, developer of education center.
фото: Евгений Егоров