Subject: RE: Charging the Charger
From: "Anderson, Kelly" <KAnderson@dentrix.com>
Date: Fri, 20 May 2005 14:02:28 -0600

 Fri, 20 May 2005 14:02:28 -0600
Very well stated Brian.

While it is clearly possible to get all that without initial licensing
revenue, (VCs tend to be a very cynical and doubtful bunch) it is still
difficult to attract early-stage investors. But it has always been so.
Nothing has really changed, as the challenges remain.

I guess if it were easy, everyone would do it. :-)

-Kelly 

-----Original Message-----
From: Brian Behlendorf [mailto:brian@collab.net] 
Sent: Thursday, May 19, 2005 6:52 PM
To: Anderson, Kelly
Cc: fsb@crynwr.com
Subject: RE: Charging the Charger


A much more simple way to say what you're saying, and one that avoids
painting challenges as showstoppers, is that early-stage investors are
attracted to opportunities that show:

* defensibity against competition
* superlinear returns (the amount of money it takes to earn an
additional
$1 declines with growth)
* proven track record by the founders
* a compelling value proposition to customers (with evidence)
* a credible projection of costs and revenues (with evidence)

It's possible to get all of that without a lick of licensing revenue.

As to your last point - JBoss bootstrapped itself entirely with support
and custom development services and was profitable long before taking a
very healthy chunk of VC investment.

 	Brian






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