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The Truth About Getting Funded

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This story appears in the September 2012 issue of Entrepreneur. Subscribe »
A Whole New Trip
image credit: Shutterstock

Watch experienced entrepreneurs land a round of funding, and you likely won't see big parties or champagne flowing. That's because they realize that they now own and control a little less of their company, and the path to success has taken on a whole new direction. That's the bargain they made to help take their dream one step closer to successful reality.

But even the definition of "success" can vary among funded companies. The topic of "metrics for entrepreneurial success" recently came up during a board meeting for a business plan competition with which I'm involved. The board almost unanimously decided that the best metric for measuring the success of the companies in the competition was -- get this -- how many had gone on to raise more money. Success to these people had nothing to do with the product, team or profits. As one of the few entrepreneurs in a room full of investors and business service providers, I cringed.

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