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Financing Your Radical Concept

Is your company's concept so cutting edge that investors won't touch it? Here's how to get their attention--and their money.

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This story appears in the April 2006 issue of Entrepreneur. Subscribe »

Back in 2000, just before the bottom fell out of the IPO market and VCs began shut-ting their doors to just about everyone, entrepreneur Tim Westergren managed to raise $1.5 million in seed money for his fledgling company. Westergren, a former musician, came up with the idea to create a sophisticated database to help music lovers identify artists and songs they might like based on their listening tastes. At the time, it was a brand-new concept--but after the initial investment, no one would fund it.

The seed cash ran out after about a year, "and then things got really interesting," says the 40-year-old founder of Pandora Mediain Oakland, California. Over the next two years, the company managed to scrape up a few small investments. "But that was primarily to keep the lights on," says Westergren. "I literally had days when I went from a negotiating session with one of our big customers to the courthouse to fight eviction."

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