There are plenty of reasons why companies seek venture capital (VC) investments. Cash-strapped young start-ups in particular can benefit from the experience and connections venture capital firms can offer—something unavailable through bank loans, money from friends and family or maxing out their credit cards. Not only can VC investors write bigger checks, they offer experience, connections and expertise that is hard to find elsewhere.
Plus, in many cases, VC investors are experts at helping to guide entrepreneurs through quick growth and scaling businesses fast.
“If you are looking for and positioned for explosive growth, that’s what venture capitalists do for a living,” says Rich Stendardo, CEO of Yottaa Inc., an e-commerce technology company that works to speed up desktop and mobile websites, and one that has raised more than $52 million in five separate funding rounds since its founding in 2010.
Overall, the number and value of venture capital investments in e-commerce companies fell off fairly significantly in 2016 when compared with 2015, as experts say the market was in somewhat of a correction mode. Still, there was plenty of cash to go around last year, as VCs closed nearly 300 funding rounds worth more than $2.6 billion—all in e-commerce alone
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