Many would-be entrepreneurs think that they need to start talking to investors as soon as they have an idea for a startup.

But that's not the advice from David Thompson, co-founder and CEO of Web analytics firm Genius.com.

"Spend a lot of time developing your idea and your technology on your own," before starting to raise funds, he says. "Take that as far as you can without thinking, 'I gotta have money.'"

And spending too much money can be as bad as raising too much, says Thompson.

Thompson, along with Genius.com CTO Robert Seidl, started Genius in 2005 after six years at WebEx, the online collaboration software and services firm that was acquired by Cisco Systems earlier this year.

The WebEx experience taught him how painful it can be if you hire too many people too quickly and then you're business goes into the kind of "deep dive" that came with the dotcom bust.

"Don't go haywire," and let your cost structure get out of line, he advises, because "it's very painful to lay people off."

To see an interview with Thompson discussing Genius.com's challenges and opportunities, click here.

To see his Vator.tv pitch, click here.