Any time a startup's blog is updated with news of funding, it's a good thing. But when that funding is some thirteen years in the making, it's particularly noteworthy.
FluidInfo announced today that it had secured $800,000 in a Series A funding round. Once described by tech blogger Robert Scoble as "world-changing" but "unfundable," FluidInfo founder Dr. Terry Jones has demonstrated tenacity in the face of investor doubts and rejections.
With that experience comes quite a number of useful insights that Jones shares in a blog post today called "Anatomy of a Funding":
Learning to expect and embrace rejection: Jones has written before about the importance of rejection. Although rejection is never fun, it's important to recognize that it comes with the territory of working with new and creative ideas. Jones writes, "if you're smarter than average, your ideas will, on average, be ahead of their time. Some level of rejection comes with the territory.But I'd go much further than that, and claim that if you are not seeing a very high level of rejection in trying to get a new idea off the ground, you're probably not working on anything that's going to change the world or be extremely valuable."
Learning to say no: Jones points out that while searching for investors, he did say "no" to valuations and offers he felt were too low. He also refused to change directions for his project, as some recommended he work on building an app rather than re-envisioning database architecture.
Pushing back on the elevator pitch: Although it's important to have a short, succinct elevator pitch, Jones points out that it's important to have the time to map out your vision in a longer conversation, and more importantly, perhaps, find investors who are willing to listen to something more than a quick explanation of the project. "I don't think entrepreneurs should obediently infantilize their grand visions just so someone who's probably not going to fund you can perhaps understand what you're doing. Sure, if you have a compact idea that you can package up into a tiny pitch, go for it. If after trying to do that, you don't, go find some potential investors with the patience to listen to you."
Talking to VCs too early: One of the lessons Jones said he learned was that he tried to talk to venture capitalist firms too early. He felt as though he needed a lot of money and that he had a great idea, but rather than aiming at angel investors, he went directly to VCs, neglecting "to talk to the only people (with money) who could really appreciate what we were trying to build."
Avoid entrepreneurial clichés: When Scoble wrote about FluidInfo some 18 months ago, he said the project was unfundable as it was too general, as there were no stars on the team and no deployment or adoption of the technology. The idea, said Scoble was just too hard to explain. Not only has Jones demonstrated Scoble and others wrong, but as he writes in his blog today, entrepreneurs should avoid some of the commonplace advice that might stop "world-changing" projects from being pursued.