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September 2019

Stop chasing the money! 1024 681 IMPACT Accelerator

Stop chasing the money!

Why do startups focus so much on investment? It's a mistake to put all energies on that

When asked about writing about the subject above, I make a reflection on whether there is an excessive tendency by startups to seek successive funding rounds appealing to the need to invest more and more.

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If we define a startup as an innovative company with a strong technological component, it is logical to think that the early stages are focused on the development of a product. For brevity, in this article, I’m going to use the word “product” to represent anything a startup is looking to launch—a product, service, offering, or brand. The essential characteristics of the product, and I mean those that will be crucial in its acceptance by the consumer, will not yet be proven and evident. And at some point in this phase, the go-to-market decision will have to be made.

Many times, what I have found is that entrepreneurs are so in love with their idea that the tasks of creating a company bore and bother them. In many cases they are scientists, technologists and maybe not businessmen or managers and their passion is in the continuous development of the product, looking for new derivatives, more features, … more investment in short. Comes to mind a quote from Reid Hoffman, founder at LinkedIn, “If you’re not embarrassed by the first version of your product, you’re launched too late”[1]. Agile methodologies, as lean startup is, help to optimize the process because collecting information from a minimum viable product (MVP) is less expensive than developing a product with more functions to prove.

“If you’re not embarrassed by the first version of your product, you’re launched too late”

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If at any time during this process (development or early stages of commercialization) there is not enough cash, a new financing process is launched. This is usually the time for business angels, since the company is still at a very early stage to go to the banking circuit. Crowdfunding platforms will be other financing alternatives available to startups.

Measuring what the financial effort should be to reach the market is crucial. Scaling up too fast at this time can become a mistake because investing in this aspect involves hiring not only a commercial team[2] but marketing expenses and others related. If we do not have properly adjusted delivery or service processes, they will not generate a satisfactory user experience, which can lead to permanent damage to the company that cannot be overcome in the future, if exists. It is important to grow, but it is also important to define well the processes and at the same time create a solid corporate culture. Two necessary visions of the company: outward and inward.

Another circumstance that, in my opinion, leads a startup to focus excessively on investment and growth is the mind of the entrepreneur. In his mind he is not building a company, in a humanistic sense, with long-term survival vision. He considers it more as a project, a concept with a greater temporality component; that is to say, it begins, it ends and then searches for another[3]. He liked the way, and having good luck (and with effort, of course) has generated him a good amount of money. He thinks what he has to do is to replicate it, and quickly. And the current climate that surrounds the startup ecosystem leads him to it. It is assumed that what makes a successful startup is the volume of funding rounds that are achieved “to face investment and growth plans.”

And in this sense, and now I am going to the last of this set of reflections that I do not want to be extended more than necessary, the CEO[4] should not forget the fact that growth is important, but it must be constantly monitoring the cash. Because there will come a time when cash problems cannot be solved with new capital, but sales (and collections, what is high sensitive) and profitability will have to be shown. At least positive gross margin. A success is to get an investor, but SUCCESS is to sell, that your idea becomes a marketable and accepted product. And, many times, a lot of energy is wasted in contacting and trying to convince VCs when efforts should be focused in “building a company”.

[2] In a traditional understanding, and with a financial-accounting view, creating a commercial team is not an investment, but this is so often presented to justify the amounts at funding rounds.
[4] Now he is a real CEO, once he (or she) has incorporated external partners into the capital.

About the author

I wanted to be like Alan Parsons. But finance and strategy stole most of my professional brain (but not my soul 😉). I have worked as a CFO or managing director at several companies, and as a external consultant I have carried out dozens of projects aimed at business improvement. I have also invested and advised several startups. Others, even, were not born as such.
Ah!, I have never run a marathon, but just up to now. I mustn´t lose hope.
Always learning.

In IMPACT, we proud ourselves of having the best mentors for the startups that go through our programs.
Francisco Javier López Somoza is part of our top-tier mentor network and helps startups sharing his extensive knowledge in Corporate Finance, Banking, Business Development, Digital Transformation and Strategic Planning.

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Cut the crap, nobody is that important 1024 682 IMPACT Accelerator

Cut the crap, nobody is that important

Cut the crap, nobody is that important

In our current ecosystem, no matter if you work for a startup, multinational company or yourself, your calendar is full of action items, reminders or meetings. With such frenetic activity, it is really easy to lose focus and productivity here and there. By the end of the week, those moments have turned into poor meetings, reminders on hold and incomplete action items.

There is a tendency to value people that multitask and/or situations that require multitasking. However, it is proven that multitasking doesn’t deliver quality results (as commonly believed), besides the fact that it is not a nice thing to do while someone requires your attention.

“If you are in a meeting with me, you have my full attention” Eli Broad, The Art of Being Unreasonable, Chapter 6

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I cannot agree more. As I once told a fellow MBA classmate of mine (he still is with me in every single meeting), “Your time is not more important than mine”. With that sentence, I promise I didn’t want to be rude, but I made my point. In my opinion, it is a social contract when someone agrees to meet. That is why it is important to set expectations with your team from the beginning.

On top of that, when dealing with someone else’s agendas and calendars, we believe that everything is important and urgent and therefore has to be answered with a “yes”. That creates an expectation gap.

The bottom line: in our current dynamic, we have plenty of tasks to complete. Some of them are important, urgent, or both, while some are neither urgent nor important. Therefore, we need systems to not only manage our tasks but to prioritize them continuously.

Prioritization is crucial because it will allow you to use your time effectively and not just efficiently, focusing on what really moves the needle forward.

“If you can’t delegate, it’s not someone else’s problem, it’s your problem” Eli Broad, The Art of Being Unreasonable, Chapter 6

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Whether you are a decision maker or executor, time is the only resource that is not coming back or stopping. However, you can manage time by setting a list of action items (a to-do list) and prioritizing them. In doing so, you will get the best out of your time allowing you to not only be efficient, but also effective. Everyone around you will thank you, because at the end of the day, you will be giving time back to their lives.

Prioritizing requires methodology and discipline as well as being flexible and not rigid. However, it is quite interesting to consider the consequences of those situations for your own time management planning and for understanding implications for someone else’s schedule.

One of the most simple methods is the Eisenhower’s Urgent/Important Principle, reflected in a 2×2 matrix (below). It helps you plan and coordinate your action plans as well as coordinate your team performance.

The idea behind the method, which I find self-explanatory, consists of two main points:

  1. Prioritize
  2. Get insights


  • Prioritization helps while planning the “important” task in order for it to move then to the right, transforming a “Crisis” (urgent and important) into a “Project” (important and not urgent)
  • While prioritising “not important” tasks in your to-do list, this matrix helps you either delegate them or remove them completely, as they only create distractions rather than add any value.


Once this method has become a routine, it should be easy for you to analyze and obtain different business insights according to the results of your prioritization process.

Many things are out of our control because they depend on someone else’s actions, follow-ups or approvals. However, if we are able to prioritize our tasks and schedule, we will get many more things done using our time effectively and efficiently.

About the author

I started my career working in high demanding roles learning from clients, managers & C levels. I love the entrepreneurial and startup ecosystem, which shape and build the future innovation above and beyond. Having 15+ years of experience in different fields, what I bring to the table is a diverse and transversal point of view. My mind is always working to solve potential issues in particular situations and proposing different actionable alternatives.

All in all, I have developed a personal, deep understanding of the skills that any company needs to ensure that their teams deliver and build value following the company’s mission. I truly believe that why is more important that what.

I am driven by curiosity which can be demonstrated through my ventures in professional, volunteering and my personal life.

In IMPACT, we proud ourselves of having the best mentors for the startups that go through our programs.
Ángel Araujo is a Specialised & Follow-up mentor for at least 10 startups from the IMPACT Growth & IMPACT Connected Car acceleration programs.

His extensive experience goes from working in companies like Google and, just to name a few and he is one of the founding partners of,

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