Dear Small Biz Owner. VC Backed Startups Are Not Your Mentors.

VC backed startups are cool. But might

Often times we see the glamour of venture capital backed, billion dollar (to be) companies and wistfully wonder, if we should follow their routes. Some of the things they’re doing are good – we can learn from them. But other things might not be so good.

The NY Times writes about Jet ,how it’s prepared to lose money for 5 years and it’s plan is to sell memberships and make it’s money that way. I guess it COULD work, but it’s not a model that small businesses should follow – losing money for years and making money NOT with the product you’re selling. There’s only ONE Amazon.com

Intense competition in the delivery space may be prompting such offers. According to one venture capitalist, “some of these companies are forced into making moves that they know don’t make long-term economic sense, but they could make short-term economic sense if they end up winning the customer’s loyalty.”

Small business owner, remember, you’re not a “dot-com”. Make smart investments in your business. Follow the advice of Norm Brodsky in Inc Magazine, Joe Connolly of WCBS Radio and the writers in Smart Hustle Magazine. Make a product you can sell a make a profit from.

Even my distant mentor, Marcus Lemonis of CNBC’s The Profit believes in making money from what you sell – making a PROFIT.

For those entrepreneurs, who have BIG ideas and need venture capital for seed or growth funding – GREAT. However, spend your money wisely and ensure the FOUNDATION of your business is built on simple and solid principles, not on “funny money”.

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Ramon Ray, Editor & Technology Evangelist, Smallbiztechnology.com . Editor and Founder, Smart Hustle Magazine Full bio at http://www.ramonray.com . Check him out on Google Plus, Twitter or Facebook

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