Vivek Wadhwa on Why "Less is More for Startups"

Article: www.businessweek.com/smallbiz/content/jun2009/sb20090623_890999.htm

Some key points:

1. Seasoned veterans with track records are going to be expensive and want perks
2. Being less funded will motivate team to seek profits early rather than unsustainable growth
3. Team forced to resourceful and get things done cheap
4. Hunger (i.e. too much money / success makes people complacent)

Points are valid and I agree if the main argument is limited to "being undercapitalized isn't a death sentence". No it isn't, but it's not a situation entrepreneurs should actively seek out either!

It may not be a death sentence, but it sure means that the owners have to dig real deep. Take for example the other side of the coin for all the above 4 points:

1. Correctly identifying and hiring good people based purely on potential instead of track record takes requires the founders to be extremely good at talent acquisition and management.
2. It takes founders with tremendous fortitude to say no to business that will distract the company from its core goals and business.
3. Over-doing it or making people who aren't too resourceful to do it will result in lots of time wasted and distractions from the core business.
4. There is a thin line between hunger and desperation, and desperation is as destructive as complacency.