Umm... I donno. I think taking other peoples money in general is a bad thing due to psychology. It's very easy to spend other peoples money but you always think one time extra before you spend your own.
Many of these companies that take on huge VC rounds or take a lot of debt seem to often employ unnecessary many people, hire big unnecessary offices money that would never have been spent if it was their own money.
Sure I understand if you really need to grow fast, but even then I think many spend their money on unnecessary crap even when they have zero revenue.
The goal for every company should always be to maximize revenue and minimize the cost of doing business. People in the startup scene seems to forget that too often.
> maximize revenue and minimize the cost of doing business
Often doing both at the same time is difficult, and near impossible. To increase revenue you need a sales staff, and engineering time on building new features for new markets. Reducing costs requires your engineering staff, and maybe a business staff to negotiate with suppliers (or whatever your other inputs are). The engineers are often different kind of people. The type of engineer who is great at maximizing a process is probably not the same type of engineer who is good at rapid prototyping, and building something that "just works".
There's a transition in every startup that reaches a point of maturity where they start to build processeses, and start to rebuild existing systems. It's usually at the same time that the founding staff starts to leave.
Startups concentrate on Revenue, and hope they reach the level of worrying about costs.... and VC money makes that SO MUCH EASIER. Bootstrapping usually means you limit your input costs, which limits the rate of growth you can achieve.
> The goal for every company should always be to maximize revenue and minimize the cost of doing business.
Startups don't forget that--they just focus on the former whereas established companies focus so hard on the latter that anything different looks unusual today.
Many of these companies that take on huge VC rounds or take a lot of debt seem to often employ unnecessary many people, hire big unnecessary offices money that would never have been spent if it was their own money.
Sure I understand if you really need to grow fast, but even then I think many spend their money on unnecessary crap even when they have zero revenue.
The goal for every company should always be to maximize revenue and minimize the cost of doing business. People in the startup scene seems to forget that too often.