According to a recent study by venture capital firm, First Round Capital, most billion-dollar entrepreneurs did not rely on venture capital to launch their businesses – instead, they rely on themselves.
The common misconception among startups is that venture capital is needed to succeed. In fact, 94% of the entrepreneurs surveyed took off without VC funding. While venture capital can certainly provide a financial boost, it often comes with strings attached, such as a loss of control or the need to prioritize growth over profitability. However, it is not a risk-free investment, as 80% of those with VC funding still fail. Instead, many entrepreneurs are finding success by bootstrapping their businesses or seeking alternative forms of funding such as crowdfunding, angel investors, or strategic partnerships. This kind of entrepreneurship, called “unicorn-entrepreneurship” by Forbes, might be the way of the future.
The key to success for these entrepreneurs, the First Round Capital study says, lies in their ability to focus on solving a real-life problem and building a sustainable business model. By prioritizing the needs of their customers and generating revenue from the outset, these entrepreneurs can grow their businesses organically without relying on outside funding.
Rather than focusing too much on the golden goose of VC, many choose to go through the unicorn-entrepreneurship route. They fund their businesses by building a solid network of advisors, mentors, and fellow entrepreneurs who can provide support, guidance, and connections. This network can help entrepreneurs navigate the challenges of building a business and provide access to resources and opportunities that might otherwise be unavailable.
Additionally, unicorn entrepreneurs must have perseverance and a willingness to pivot when necessary. They often face setbacks and obstacles along the way. Still, by staying focused on their vision and adapting to changing circumstances, they can overcome these challenges and achieve their goals.