In my previous post, Seven years in Bicol, I wrote about my earlier attempts at building startups and the lessons I carried into this next chapter.
One of those lessons has changed how I think about funding a business.
In the past, when I started building a startup, my instinct was to look for investors who could fund its operations. I had a platform, an initial business model, and a vision of what the business could become. What I needed was money to keep building.
I believed that if I could find the right investors, I could give the startup enough time and resources to grow.
Looking back, I realize there was something I should have questioned first.
Was I raising money to grow a business, or was I raising money to find out whether I had a business?
There’s a difference.
When a vision is enough to get people interested
Investors can see the potential in an idea before it becomes a functioning business. They may understand the problem you’re trying to solve, believe in the market opportunity, and appreciate the platform you’re building.
Sometimes, they may even see something in your vision that other people don’t see yet.
That kind of belief can be encouraging, especially when you’re a founder trying to turn an idea into something real.
But a startup can have a promising vision, a working platform, and a reasonable business model on paper without having a single paying customer.
I’ve been in that position.
You can spend months thinking about the market, designing the product, building features, and imagining how the business will operate once it gains traction. Everything can make sense when you’re looking at it from the inside.
The real test begins when you put the product in front of customers.
Will they use it? Will they pay for it? Can you reach enough of them without spending more than the business can afford? Will the revenue be enough to sustain operations?
Those questions cannot be answered by the quality of your pitch deck or the enthusiasm surrounding your idea.
They need evidence.
And the earlier you can obtain that evidence, the better informed your next decisions will be.
The mistake isn’t raising money. It’s raising money before knowing what you need to prove.
I don’t believe every startup needs to generate revenue before approaching investors. Some businesses require substantial capital before they can build a product, conduct research, obtain regulatory approval, or enter a market.
There are legitimate reasons to raise money early.
But for a founder building a business around a platform and an initial business model, I believe there’s value in exercising restraint.
If I could go back to my earlier startup attempts, I would have challenged myself to spend more time validating the business before looking for investors to finance its operations.
I would have asked myself harder questions.
Have I identified customers who genuinely need this product? Have I spoken to enough of them to understand their problems? Can I get people to use the platform? Is there evidence that they will pay for what I’m offering?
And if people aren’t buying, do I need more money to reach the market—or do I need to reconsider the product, the pricing, or the business model itself?
These questions matter because money can give a startup more time to operate without necessarily making the business more viable.
You can have enough funding to keep paying for development, marketing, and operating expenses. But if the underlying assumptions are wrong, you may simply be spending more money before discovering the problem.
Capital can accelerate progress. It can also accelerate the cost of learning the wrong lessons.
The objective shouldn’t be to raise enough money to keep a startup alive. It should be to build a business that has a credible path to sustaining itself.
The money doesn’t disappear when the startup fails
There’s another part of this lesson that I take seriously now: the financial consequences of getting things wrong.
When you’re building a startup, it’s easy to focus on the money you need today. You think about development costs, marketing, operations, and how much runway you need to reach the next milestone.
But you also need to think about what happens if the business doesn’t work.
Not because you should expect to fail, but because responsible founders need to understand the risks they’re taking.
The consequences depend on how the business is funded. Equity investment doesn’t automatically become the founder’s personal debt if a company fails. Borrowed money and personal guarantees, however, can create obligations that survive the business itself. Founders may also face significant personal financial pressure from commitments they made while trying to keep operations going.
And even when an investment carries no personal repayment obligation, you still have a responsibility to treat that capital seriously.
Someone trusted you with resources because they believed the business had potential. You owe them honesty about what you’ve learned, what the business can achieve, and where the risks stand.
That’s why I think founders need to be deliberate about funding decisions from the beginning.
Before accepting money, understand the terms. Know what you’re committing to. Be clear about the milestones the money is supposed to help you reach. And be honest with yourself about what happens if you don’t reach them.
You don’t need to eliminate every risk. Entrepreneurship would be impossible if that were the standard.
But you should understand the risks you’re choosing rather than discovering them only after the money has been spent.
This time, I want to earn my way forward
I’ve launched Listo, my staycation and parking marketplace in the Philippines. I’m now working to establish traction and build a sustainable business around it.
At the same time, I’m trying to land my first web development client in this rebuilding phase.
My core service is WordPress website development. I can also build business websites, e-commerce platforms, custom plugins, and other web-based systems.
The immediate challenge is finding clients and establishing consistent revenue. I’m still working toward that.
My plan is to build a service business that can support my livelihood while giving me a way to finance the continued development and growth of Listo.
It’s not the fastest-looking route to building a startup. Client work requires time, and that time competes with the work I need to do on my own product.
But I see value in building something that generates income from customers who are paying for work I can deliver today, rather than depending entirely on capital raised for a business that is still proving itself.
This doesn’t mean I’ll never consider investors for Listo. There may come a point when external capital makes sense—when there’s clearer evidence of demand, a better understanding of the business model, and a specific opportunity that funding can help unlock.
If that time comes, I want to approach fundraising with a different set of questions.
Not simply, “How much money do I need to keep building?”
But, “What have I proven, what do I need to accomplish next, and why is raising capital the right way to get there?”
I want funding to help accelerate a business that is becoming more viable, not simply postpone the moment when I find out whether it can work.
A lesson I’d share with founders who are just starting out
If you’re a young entrepreneur building your first startup, I understand the appeal of finding an investor early.
You have an idea you’re excited about. You can see how the product could work. You imagine what the business might become if you had enough money to hire a team, market the platform, and operate without constantly worrying about expenses.
And when someone believes in your vision, it can feel like you’re finally getting the chance to build the business you’ve imagined.
But don’t let the excitement of getting funded distract you from the harder question of whether you’re building something people actually want.
Before looking for someone to finance your startup, look for evidence that the business deserves to be financed.
Talk to potential customers. Test your assumptions. Find the smallest practical way to demonstrate that people want what you’re building. Where possible, get them to pay for it. Learn what it costs to acquire a customer and deliver your product. Understand which parts of the business model work and which still need to be tested.
You may discover that you need investment to move forward. That’s perfectly reasonable.
You may also discover that you need to change your product, your market, or your approach before spending more money.
Both outcomes are valuable. They’re much better discoveries to make before committing capital you may struggle to replace.
And if you can generate income through consulting, freelancing, or another service while validating your startup, consider whether that could give you more room to make decisions without immediately depending on outside funding.
It won’t be practical for every business. Some opportunities genuinely require significant upfront capital. But when you have the option, there’s value in proving what you can before asking someone else to finance what you haven’t yet proven.
Building differently this time
I’m still at the beginning of this chapter.
I haven’t landed my first client in this rebuilding phase, and Listo is still working to establish traction. I don’t have a success story about this approach to share yet.
What I do have is a clearer idea of what I want to do differently.
I want to focus on generating income, getting closer to customers, and building evidence that the businesses I’m working on can sustain themselves.
I want to be more disciplined about when I seek funding and what I expect that funding to accomplish.
And I want to remember that building a platform is only one part of building a business.
The real work is turning that platform into something customers value enough to use, pay for, and return to.
For now, that means finding my first client while continuing to build Listo.
It’s a modest next step compared with the vision I have for the startup. But this time, I want to pay closer attention to the foundations I’m building along the way.
Because having a vision matters.
Learning how to turn that vision into a sustainable business matters even more.
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