Mark Cuban speaking on the NextMarket podcast declares that Crowdfunding site Kickstarter should be a requirement for every start up;
“Kickstarter should be a requirement for every startup. It’s a way for you create demand and sell the product without giving up any equity. That is a compliment to what an investor might do. In terms of PE, there are strategic investors and then there’s just money. I’m not a big fan of money investors, which is what most angel investors turn out to be, because they just want their money back.”
Reported in Business Insider, the basis of his thesis is that its all about cashing out;
His argument is that those money investors create an atmosphere where it’s all about the exit rather than creating cash flow. Kickstarter is something an antidote because it helps entrepreneurs to actually focus on their product, market it, and generate some money. Cuban said he rarely invests in a company unless he can add something.
“Money investors” have helped drive some companies away from the things Kickstarter requires, like confirming demand and generating cash flow.
You May listen to the entire podcast below:
[soundcloud url=”http://api.soundcloud.com/tracks/73599548″ width=”100%” height=”166″ iframe=”true” /]
