Dave Taylor (via Mary Sullivan):
So the real question to ask your team is: do you have a business or do they have a neat piece of software? A business has a marketing and sales organization, existing customers, a measurable market visibility, a long-term development plan, and so on. Most startups – even some that are funded, frankly – aren’t full businesses. But if a company does have a strong, competitive product, some measurable cash flow, a few good customers, and some visibility in the marketplace, then it’s well positioned to look for some capital to help it grow faster. Investors don’t pay for that first step, though: startups have to get their act together first.