This 25-Year-Old Said No To $10 Million In VC Cash, Then Built A Wildly Successful Startup

Alistair Crane Grapple Mobile CEO
Alistair Crane told a VC offering $10 million to take a hike so his startup could operate on a shoestring

[credit provider=”Grapple Mobile”]

Alistair Crane is 25-years-old and co-founder of startup Grapple Mobile, which builds custom mobile apps for big companies. He’s living proof that startups don’t need VC money.He and his co-founder, Jamie True, said no to a $10 million offer to seed Grapple in the early days, a mere two years ago.

“We framed the offer letter from the bidder and it sits in one of our toilets in our U.K. headquarters,” he laughs.

Crane and True wanted to live poor. They wanted to watch their pennies. They wanted to construct a business that had to be profitable. Most of all, they didn’t want to have to give their profits to an outsider and have that guy telling them what to do.

“You see lots of really cool young business run to VC houses early in life and they end up selling a whole slab of their companies,” he explains. “Raising money is brilliant and having a huge war chest is fine, too. But ultimately you relinquish a certain amount of control, if not all of it. It can also stifle proper entrepreneurialism. When you’ve got $20 million in the bank, you lose some of that drive to make ends meet.”

Crane’s and True’s determination to build their company on a shoestring worked. Grapple supports itself and has been able to invest $9 million in growing the business. Since the company opened its doors in January 2010, Grapple grew from three guys to about 85 employees in three countries: the U.K. (London), Canada (Toronto) and the U.S. (New York).

Its customers include McDonald’s, Procter & Gamble, Adidas, IBM, Pfizer, Microsoft’s Xbox unit, Hertz and T-Mobile. Grapple Mobile builds them custom mobile apps for iPhone, Android, BlackBerry, or Windows Phone 7— any device their customers use. For instance, Windows Phone 7 is gaining popularity with teenage girls, Crane says. That means it might not be a big deal for IBM, but would be for McDonald’s.

The average age of his employees is 24, Crane says.

He tells a great story of how his team uses their youth to win contracts. He was having a meeting with the European CEO of big global company. During Crane’s presentation on mobile statistics the CEO interrupted and asked how old he was. Crane countered by asking, “How old were you when you bought your first mobile phone? I was seven.”

‘nuf said.