Cleantech Survival Guide
If you’re like many cleantech startups right now, you’re looking at your funding goals and your funding level, and you’re seeing a sizable gap. For most companies, venture capital and angel investing hasn’t come back in 2010 as we had hoped. So what should you do?
Investors and start-up often talk about a place called the Valley of Death. On the near side of the valley of death is safety: Your company is small, but relatively stable. There is less risk, but your prospects for growth are much lower because you need funding to reach a critical mass and gain some momentum.
On the far side of the Valley of Death is also stability. This is the oasis that companies find after they’ve hit their funding goals, and they can focus on the blocking-and-tackling execution of creating a successful business.
Located between these two stages of comfort, the Valley of Death is a limbo stage. You can’t stay on the safe side of the valley forever, and you’ll need to grow to survive. And to achieve this growth, you’ll need funding. And there’s the catch: You’ll be far less risky to investors once you’re on the other side of the valley, and you’ve proven that your company is viable and profitable. The Valley is one, big Catch-22: You need funding to grow, but you need to grow to get funding.
