in Innovation

Bootstrap 1.0

In response to David Hornik’s Bubble 2.0 I responded that it looks more like Bootstrap 1.0 to me. Scott blogged this topic a month ago…

With customers using a working product, decisions about what type of additional capital will be needed to scale are much easier to frame. And if you do decide to approach an outside investor, you’ll be holding more of the cards. …Bootstrapping is the new black.

I think we’ll see more overall innovation in the world if smart people aren’t only spending their time at investor presentations, waiting with their hands out instead of getting down to work.

It could be more profitable too. Today’s Wall Street Journal covers the topic, reporting the amount Flickr received from Yahoo! ($25 million?) was “significantly higher than the value Accel Partners had put on the company and Accel’s proposed investment.

There’s still a place for venture investment of course. But VCs might need to evolve, making a greater number of smaller investments.

And incidentally, how funny is it to see the name Ludicorp in the Wall Street Journal?