To quote Larry Kudlow: Free market capitalism is the best path to prosperity! Matters of business and free enterprise are discussed on this blog. Included are company press releases, 3rd party news articles and videos, articles and videos pertaining to small business, and white collar crime.
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Tuesday, October 25, 2016
How the Declining Cost of Getting to Market Has Impacted the Financing of Software Startups
The declining cost of generating a minimum viable software product has changed the way software startups raise money. Back in the 1980s, it took tens of millions of dollars to create and test a beta version of a software product. By 2014, that cost had fallen to around $100,000.
This enormous decline has shifted how software start-ups raise money. The traditional model of raising money from individual angel investors followed by institutional venture capital has given way to tapping quantitative micro venture capital (QMVC), and business accelerators. (In a future column I will discuss the move toward business accelerators, but today I will focus on the shift to QMVC.)