Shao Yibo - the founder of EachNet, after successfully selling it to eBay, has recently launched BabyTree (Baby Tree) which has been warmly received!
The first question to ask is, "Should we look for a VC?" VCs are a very special kind of animal with their own unique needs. Once you bring one in, you need to meet those needs. If you're not willing or unable to meet them, then don't invite them in. Otherwise, they'll turn your house upside down, and in the end both the company and the VC will fail.
What are the needs of VCs? There are many. But the most important and fundamental one is, "We need to successfully sell my shares at more than 10 times the price within about 5 years." This may seem like a basic and reasonable requirement, but its impact on how VCs select companies, behave in the boardroom, and influence the invested company is broad and deep.
Let's analyze four key words: sell, ten times, five years, and us.