networkOne

It seems that companies use VC funds as the main advertising for their company these days. In fact, without capital raising it is hard to set yourself apart from the rest of the budding companies started in their thousands each day.

The receiving of VS funds now seems the only way one can create any virality in the marketplace. People still have a plea to the expert-from-out-of-town in that they feel... "well VCs are very experienced people who know what to look for when investing", which is counter-intuitive when faced with the realisation that VCs fund 19 losers for every 1 unicorn.

People want a company to be big before it has a marketplace-chance of being big. An press release of "ABC Co., a startup tech firm, has a $25M investment from Vulture VC Fund resulting in a $1B valuation" carries considerably more viral weight that a PR stating "ABC Co., a startup tech firm, has a business plan that can change the world".

And the VC industry is certainly promoting this line of thought... that the starting point of any future unicorn and VC funding go hand-in-hand. With the converse implications that if you have a great concept and execution path, that VC funds are a requirement.