Venture Capital vs Bootstrapping: John Steuart Of Savvy Properties On How To Determine If Fundraising Or Bootstrapping Is The Right Choice For Your Startup

Failure is a part of the process and you learn from it. It’s also important to surround yourself with supportive people who believe in you and your vision. Finally, don’t give up on your dreams. Pursue them with determination and you’ll achieve success.

Founders are often faced with the nagging question of whether Fundraising or Bootstrapping is the best choice for them. What is better, having access to capital or maintaining full control over your vision and profits? What is preferred, to have the seasoned oversight of an experienced investor, or to plow forward with a disruptive and pioneering ‘can do’ attitude? Of course, every situation is different, but what standards can be used to help a founder decide? As a part of this series called “Venture Capital vs. Bootstrapping: How To Determine If Fundraising Or Bootstrapping Is The Right Choice For Your Startup”, I had the pleasure of interviewing John Steuart.

John Steuart is an entrepreneur and venture capitalist based in California. He co-founded several companies such as Alafi Capital, Cybergold, Claremont Creek Ventures, and Savvy Properties. He is an advocate of technology and healthcare and is a mentor to young entrepreneurs.

Thank you so much for doing this with us! Before we dive in, our readers would love to learn a bit more about you. Can you tell us a story about what brought you to this specific career path?

I’ve always been fascinated by business and the creative process of building something from scratch. After working in a few different industries, I started investing and mentoring in startups. I basically invest in startups that have high potential and help them grow their business.

Can you share a story with us about the most humorous mistake you made when you were first starting? What lesson or takeaway did you learn from that?

It’s hard to think about that now, but there was a big mistake that happened back in the 1990s which I learned a lot from. We were working on a project in St. Louis where we developed a portal imager with a camera and connected it to the system. It was utilized in radiation therapy. We sold a few before we discovered that the product was salable. We accelerated everything, established a sales team for this product, and fast-tracked completion. When I discovered the product was not actually selling, I had to fly back and clean up the mess. From that experience, I learned how to be more careful when it comes to selling a product and to do more research before taking any further steps.

You are a successful business leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?

Passion, resilience, and creativity have been essential to my success. I’m passionate about what I do, which makes me work harder and persevere through difficult times. Additionally, creativity has helped me come up with new ideas and find solutions to problems. All of these character traits have helped me achieve success in my career.

Are you able to identify a “tipping point” in your career when you started to see success? Did you start doing anything different? Are there takeaways or lessons that others can learn from that?

There wasn’t a specific tipping point, but I started seeing more success when I began focusing on early-stage investments. I also started doing more research and became more selective about the startups I invested in. Being selective has helped me achieve better results. There are a few takeaways that other entrepreneurs can learn from my experience: do your research, focus on what you’re good at, and be passionate about your work.

None of us are able to achieve success without some help along the way. Is there a particular person or mentor to whom you are grateful who helped get you to where you are? Can you share a story about that?

There are a few people who have helped me throughout my career. My dad has always been a big supporter and gave me a lot of advice. I’ve also had great mentors who have taught me a lot about business and investing. I’m grateful to all of them for their guidance and support.

You have been blessed with great success in a career path that many have attempted, but eventually gave up on. Do you have any words of advice for others who may want to embark on this career path but are afraid of the prospect of failure?

The biggest piece of advice I can give is to not be afraid of failure. Failure is a part of the process and you learn from it. It’s also important to surround yourself with supportive people who believe in you and your vision. Finally, don’t give up on your dreams. Pursue them with determination and you’ll achieve success.

Ok, thank you for that. Let’s now jump to the main part of our discussion. Can you share a story with us about your most successful Angel or VC investment? Or an investment that you are most proud of? What was its lesson?

I’m most proud of my investment in my own company, Savvy Properties. It’s a real estate technology startup that I co-founded with my friend. We started the company with a small amount of money and grew it into a successful business. We started this business just after graduating from college, and it has been running for three decades now. The biggest lesson I learned from this experience is that you can achieve success if you’re passionate about your work and persevere through difficult times.

Can you share a story of an Angel or VC funding failure of yours? What was its lesson?

I’ve had a few Angel and VC funding failures, but the most notable one was when I was investing in a company that sells medical devices. We invested a significant amount of money into the company, but it ended up going bankrupt. The biggest lesson I learned from this experience is to do more research before investing in a company. You need to make sure that the company is viable and has a good chance of success.

Is there a company that you turned down, but now regret? Can you share the story? What lesson did you learn from that story?

There was a company that I turned down for investment, but I now regret it. The company was selling a new type of battery and I didn’t think it would be successful. However, the company ended up being very successful and I missed out on a lot of potential profits. But anyway, I am happy that the company is doing well. Sometimes, you need to take a risk and invest in something that you may not be familiar with, but I was too careful at that time.

Super. Here is the main question of this interview. Let’s imagine that a young founder comes to you and asks your advice about whether Venture Capital or Bootstrapping is best for them? What would you advise them? Can you kindly share “5 things a founder should look at to determine if fundraising or bootstrapping is the right choice”? If you can, please share a story or example for each.

1. The amount of money you need: If you only need a small amount of money, then bootstrapping is the way to go. Venture capitalists usually invest large sums of money, so if you don’t need a lot of capital, then it’s not worth approaching them.

2. The stage of your company: Venture capitalists usually invest in companies that are in the growth stage. If your company is still in the early stages, then it’s better to bootstrap.

3. The sector you’re in: Venture capitalists usually invest in high-growth sectors such as technology and healthcare. If you’re in a more traditional industry, then bootstrapping is a better option.

4. Your personal preference: Some people prefer to have more control over their company and don’t want to give up equity. If this is you, then bootstrapping is the better option.

5. The market you’re in: Venture capitalists are more likely to invest in companies that are in markets with high growth potential. If your company is in a saturated market, then it’s not the best option to approach Venture capitalists.

Each of these factors should be taken into consideration when deciding whether Venture Capital or Bootstrapping is the right choice for you. But at the end of the day, it’s up to you to make the final decision.

You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)

I would love to see a movement that encourages people to start their own businesses. I believe that entrepreneurship is the key to economic growth and poverty alleviation. There are so many people with great ideas, but they don’t have the resources or knowledge to start their own businesses. If we could provide them with the support they need, then we could see a lot of amazing new businesses being created.

We are very blessed that a lot of amazing founders and social impact organizations read this column. Is there a person in the world with whom you’d like to have a private breakfast or lunch, and why? He or she might just see this. :-)

I’d want to have a one-on-one breakfast or lunch with Elon Musk. I’m a big admirer of his talents, and I believe he’s one of the most creative minds of our generation. I’d want to learn more about how he runs his company.

Thank you so much for this. This was very inspirational, and we wish you only continued success and good health!