Yadda Yadda Yadda
~ You can't swing a dead cat in a room full of investors these days without whacking at least one person praising the virtues of
capital efficiency.
Capital efficiency? Say what?
Capital efficiency in the startup investment world refers to a company's ability to make more progress, or advance to stages of lower risk, with fewer investor dollars. It's a laudable objective to be sure; these days who doesn't prize the ability to do more with less? However, the mindless mantra of capital efficiency should merit more scrutiny.
It's swell if you're a software play. Put a couple of wired geeks in a room with a case of Monster, fast rigs and a T-1 and you can birth a beta in mere weeks that will wow the digeratti.
But what if you're a startup in something other than software? Regrettably, you'd be in a position of
explaining, not a good place from which to pitch.
At the risk of being a heretic, I'm going to call out the naked emperor: software is
boring. And redundant. Too many are piling on with me me-too plays and feckless filigrees on niche plays that mean little. Who cares? There's more to a good investment than a modest need for capital.