Yesterday I laid out why I'm not looking for investment. I'm comfortable in my choice, but it wasn't easy. The investment process brings a lot more than cash; here's what I'm losing by avoiding it.
Discipline
Convincing someone to give you money forces you to get very specific, and flesh out your business plan. Defending it against hostile questions makes it stronger. Once you've raise money, having somebody who remembers your promises breathing down your neck keeps you focused. My biggest weakness is that I'm too prone to stay in my comfort zone, working on technical experiments and neglecting everything else you need to build a business. I try to self-police that tendency, but there's nothing like having an outsider's view to keep you on track.
Time
I spend a lot of my week dealing with paperwork, doing website housekeeping, taxes, system administration, arranging travel and meetings, and all the other tasks that could be handled by somebody else if I had funding. I'd have to spend time managing investors instead, but at least the rest of my schedule could be devoted to customer support and product development.
Advice and Influence
Most investors want to convince you they're 'smart money', but from what I've experienced, not many actually bring much to the table beyond dollars. When they do though, it can make a massive difference. They can give advice that saves months of development time, and set up deals that bring in crucial revenue. The key is identifying the people who have the will and the ability to help like that. The only way to do this is by looking for a track record, and knowing entrepreneurs you trust that they've worked with before. A well-known brand is definitely not enough. In my experience the superstar firms are less eager to roll up their sleeves, they're less hungry, though the clout of their name as a credential can make up for a lot of that when it comes to making deals.
Pete Warden's blog 