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The rise of giant consumer startups that said no to investor money

By recode

A new breed of entrepreneurs is creating huge consumer brands — like MVMT and Tuft & Needle — without venture capital, and laughing all the way to the bankRead full story

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  • Coming from someone from the VC world, the following sentence might sound crazy, but it's true:

    If you're a founder and don't need tj raise capital from VCs, DON'T.

    Tuft and Needle (a mattress startup that took very little investor money) sold to Serta for what is rumored to be $800MM, and Native

    Coming from someone from the VC world, the following sentence might sound crazy, but it's true:

    If you're a founder and don't need tj raise capital from VCs, DON'T.

    Tuft and Needle (a mattress startup that took very little investor money) sold to Serta for what is rumored to be $800MM, and Native, which sold to P&G, left the founders rolling in cash because they raised very little capital, bootstrspped a lot, and stuck to the business.

    It's partly because there now are so many more cost-effective tools for founders to use to grow their consumer businesses without outside capital, and while more of this will happen, it's a welcome trend for the ecosystem.

    Also, one of our major NewsPicks users knows this situation well: Laurel Touby, who sold Mediabistro and still had a massive majority of equity!

  • Love this story, which highlights the needs of going back to the basics - a solid business problem that needs to be solved, grounded by the focus on customers and strong execution.

  • Great argument for discipline in capital allocation. The pressure of limited resources forces businesses to make choices about what is truly most important. We all wish we had “more,” but often it is “less” that forces the tough moves — and creative solutions—that truly fuel success.

  • Heartily agree. I didn’t raise capital for @mediabistro until I had solid revenues and product-market fit. When I sold the company, I owned the majority. It’s a great feeling not being forced to become a serial entrepreneur.

  • Good for them. An ICO/ITO is another way of raising funds without giving away equity.

  • Loved this article. My Millennial son shops this way. A good idea for a start up is the way forward if you can raise the capital and find that on line consumer niche.

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