12/04/2003 07:55:17 PM|||Travis|||

Bootstrapping Beauty

I went to a presentation today by Ali Perry, the financial controller of Inogen. It was a great presentation of a company that I can't help but compare Gnostic Labs too. In the 2001 UCSB business plan competition they placed first. We placed second.

So its was interesting to see their progression compared to ours. Several rounds of financing, the latest coming in at a whopping five million dollars. They have a product that is about to hit the market. They all have decent salaries and have lots of people who want their product, and are the envy of almost everyone in that industry. They are the prime examples of success.

Or are they?

It became blanently obvious that one advantage that Gnostic has is that it has NOT raised any money from large, professional investors. Why is this andvantage? Because when Inogen gets bought, the people that are going to make real money are the investors that took around 80 percent of the company (that number is coming from my ass, but also there were some data points to back it up). And they still have another round to go before they can actually start selling the product. If they do get bought, the money they recieve will be a large bonus for doing extraordinary work. The real payoff will be enjoyed by investors.

And so I think that their story isn't a great one, its merely good. Its nothing to scoff at, but this is not the story of Richard Branson, Bill Gates or Micheal Dell.

Gnostic is poor, running on fumes and always almost out of money. But, its OURS.

Enough said.

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