Disclaimer: I am currently building my first product and have no idea how any of this works.

In this day and age where almost every service you’ll ever need in tech offers a free tier and is reasonably affordable for scale, why do startups need funding?

For example, I am a relatively talented full-stack dev, if I were to build a website/app I can do it all by myself in a reasonable amount of time. I do understand that this is not the case for everyone, but for those that it is, why can’t they do this:
Build a product -> get a few users -> (make money from those sales ->) put that money into marketing -> get more users -> more money -> bigger marketing -> repeat

I’m more surprised when I read that a SaaS received funding because they usually don’t need a huge research and development team that a company like OpenAI would need nor do they depend on ad revenue which pays cents.

  • RecognitionFuture705BEnglish
    1·
    1 year ago

    Yes. You just need people. Having money just mean you can have more people. But there is other ways to get people to join you.

  • Humped8080OPBEnglish
    1·
    1 year ago

    I want to thank all of you for your responses! My view on funding has definitely changed, for the better, I suppose.

    While bootstrapping is a viable path to success, it is slower, the upside being you keep the equity.

    Getting investments accelerates your growth, equity being the expense.

    I don’t think I have the experience to run this alone, so I am considering accelerators that can give me guidance because all I understand is how to program really well, I could learn the rest from the books, videos, etc, but nothing beats good old experience I guess.

  • BonVisionsBEnglish
    1·
    1 year ago

    How do we measure the success of a startup? Despite not having raised funds, Vue.js, in my opinion, has achieved considerable success.

  • Zealousideal-Leg-288BEnglish
    1·
    1 year ago

    I’ve never raised funds and I’ve bootstrapped something up recently. So I have some thoughts on this.

    I believe it is Michael Seibel who said “Raise funds when you don’t need it.”. I suppose that’s because you get better terms, and are more confident with getting no’s because it doesn’t really matter to you.