Course Notes: Continuous Business Learning

Share this post

VC bifurcation and money

www.coursenot.es

VC bifurcation and money

Threader, 2020-01-24

Max Kraynov
Jul 6, 2020
1
Share this post

VC bifurcation and money

www.coursenot.es
  • Early stages

Seasoned/pedigreed founders are highly sought after even at the pre-seed stage

Raising $3-5m seed rounds in SV for such founders is not hard

SaaS startups (even without sexy founders) with predictable revenue are sexy [again?]

Tough luck for everyone else

Media loves hot companies and insane funding rounds. “Success” breeds publicity.

  • Later stages

Harder to raise Rounds A/B than before.

VCs started looking at profitability [MK: look at the “rule of 40%”: your EBITDA margin % + revenue growth YoY % should equal to or exceed 40%]

Some failures of companies being unable to digest large rounds and become profitable led to this shift in sentiment.

Startups with high burn rate will hit the wall and become victims of their ease of fundraising.

Thrifty founders have a better chance of sustaining this fundraising dry spell; they also have a higher chance of becoming/remaining profitable.

Link

Share this post

VC bifurcation and money

www.coursenot.es
Comments
TopNewCommunity

No posts

Ready for more?

© 2023 Max Kraynov
Privacy ∙ Terms ∙ Collection notice
Start WritingGet the app
Substack is the home for great writing