Early stage founders have a fundamental dilemma.. you need cash to get your product off the ground but you need your product off the ground to get a fair pricing and valuation for your product. Meanwhile, it’s hard to get funding from users when your real community hasn’t been built yet.
You’re at a vulnerable point, you don’t have negotiation leverage because your cash strapped and the whole conversation is about pricing your product before its even shipped.
Traditional VC's can sometimes hinder the long term sustainability and growth of the projects they invest in because they exploit the power imbalance they have over early stage teams with big promises and big checks that come with even bigger strings attached. When you’ve taken their money, you’re chained to their attempts to quickly inflate valuations so they can dump on the community you’ve built.
Bottom line, we think that with VC in the mix, founders and users are no longer the main stakeholders of a project.
We think that there is room for an alternative funding format that gives founders a cash loan to bridge them to launch and product/market fit so they can focus on building instead of fundraising. Our cash loans are:
In the old world VC funding is the dominant model because liquidity only comes with an acquisition or an IPO, both of which are complicated and take many years most of the time. Also Web2 business often need 100s to 1000s of people and many years to setup the bureaucracy to manage integrations with the infrastructure of yesterday.
Web3 businesses most of the time need teams of less than 10 and oftentimes only 1,2, or 3 people. Also with tokens, liquidity comes easily for a good project with a solid community. The hard part of web3 is getting to initial launch and product/market fit, after that, scaling is typically much easier in web3 vs. web2.
Our goal is to bridge you to product/market fit so that you and your community have all the power if/when you fundraise after product market fit...when you don’t actually need VC cash. We designed it this way because the power dynamic is wrong today. Founders and communities should hold the leverage, not the other way around.
Renpo DAO is here to support you.
Seeya on chain,
Renpo DAO