It started with a splinter in my brain some years ago. The way capital flowed and functioned for early stage tech and tech-enabled companies felt broken. It wasn’t a shortage of capital by any means, but rather where that capital was invested, where that capital came from, and the alignment — or rather misalignment — between entrepreneur and capital provider.
The Optionality Project was created to help entrepreneurs think about their capital options, as well as help foster new paths. In particular, we want to explore the funding space between bootstrapping and venture capital. We want to tell interesting stories and hopefully connect founders and the right investors as we go. If you are interested in talking, feel free to reach out to me at giff@optionalityproject.com.
This initiative is driven by three core hypotheses:
Hypothesis #1: Too many entrepreneurs obsess about getting capital, without spending enough time thinking about alignment with their capital providers. That might sound like a luxury, but it’s not. Your capital decisions play an outsized role in whether your journey ends in heartache or happiness. In particular, too many entrepreneurs rush into raising venture capital too early, before they really know whether their business will fit the VC model.
Hypothesis #2: Too many startups that have the potential to become good, but not unicorn, businesses struggle to raise any capital at all.
Hypothesis #3: Too many founders who either don’t live in one of the major startup hubs, or who don’t fit VC “pattern recognition” of what good looks like, struggle to find a capital partner to help them
After over two decades in the startup world, I’ve got a mountain of anecdotal evidence to back up those three hypotheses. Unfortunately, the causes are tough to change because they are rooted deep in entrenched startup mythology as well as structural dynamics. Thankfully, we’ve seen the rise of players like Indie.vc and Backstage Capital, among others, but I believe that more needs to be done.
Why the Name?
I’m not here to argue whether one path is better than another. Venture capital is amazing fuel for the right company, but it comes with consequences. What I do believe, however, is that entrepreneurs need to have more options and to be smarter about choosing those options, and in particular, when they choose those options.
Behind The Optionality Project
My name is Giff Constable. I’ve worked in and with startups for over two decades, across both enterprise and consumer software. I’ve sold three businesses while at the helm, helped get many others to exit as either an executive or advisor, and served as an investment banker at Broadview/Jefferies. Most recently, I led product and engineering at fintech startup Axial, where I got a bird’s-eye seat watching how private equity was engaging with small to mid-sized companies.
I’ve also written two books teaching teams how to vet new business ideas through research and experimentation. The first, Talking to Humans, won a special award from the National Science Foundation and is in use at most university entrepreneur programs around the world. The second, Testing with Humans, was recently released.