ASK ANDY SHOULD MY STARTUP RAISE MONEY FROM VCS? IF SO, WHICH ONES DO I CHOOSE?

A FRIEND'll call him Allen-spent years bootstrapping his real estate enterprise software company. After a long struggle to get to $1 million in sales, his business recently surged to $10 million, and revenue is now growing 100% year on year.

- ANDY DUNN

Prior to that inflection point, Allen had never raised venture capital. I had always perceived him to be a bootstrapper by choice, assuming that he'd never pitched anyone. He wanted to do it his way, I thought. He was scrappy.

He owned his whole company. He was a benevolent dictator, revered by his team. His company had always been profitable.

A $300,000 loan from a family friend was all the startup capital Allen had ever needed. As I scrambled to raise $128 million from investors to sell pants on the internet, I'd always thought that Allen thought I was an idiot.

(Which, by the way, he still might.) Allen recently admitted to me that he did pitch VCs early on, and got turned down. His recent success has changed everything, as VCs became much more interested.