April 17, 2025 Carta via LinkedIn : Your cofounder won’t leave… right?

A higher share of startups founded in recent years had lost a cofounder in the early going (first 1-3 years). Typically founders have a 4-year vest on their shares. That means that about a quarter of founders will leave before their vest is complete (although it may be a higher if the vest didn't begin until the first VC round). (read more…)

CATEGORY: leadership, resilience

March 11, 2025 TechCrunch : Y Combinator founders raising less money signals a ‘vibe shift’

“People used to climb Everest and they needed oxygen. Today, people climb it without oxygen. I want to summit Everest and use as little oxygen (VC) as possible.” (read more…)

CATEGORY: leadership, VC

February 24, 2025 Kyle Westway via Forbes : The New Venture Playbook: The Data Every Founder Needs To Know

About 20% of all venture capital rounds in 2024 were down rounds, double the historical average of 10%. This high percentage reflects the ongoing correction from 2021's elevated startup valuations. The time between funding rounds has also shifted significantly, with the median now extending beyond the traditional 18-24 month window. 2024 saw the highest absolute number of startup shutdowns in Carta's history. However, the failure rate remains consistent at around 90% for seed-stage companies. The bar for startup funding has risen significantly since 2021. Where once $1 million in ARR might have been sufficient to raise a Series A, founders now often need $3 million or higher growth rates to attract venture capital interest. "If you take venture capital and don't grow at venture capital paces, you could kill your company," he warns. "It is incumbent on the founder to understand their own business and choose the right type of capital for their growth trajectory." (read more…)

CATEGORY: capital, leadership, VC

March 29, 2024 SaaStr : Can You Still Get Acquired for a Decent Price if Growth Has Slowed or Even Stopped? Yeah, Sometimes

Is a SaaS startup at $10m ARR growing basically 0% objectively worth $80m today? No. It might be worth close to nothing based on a DCD analysis. No VC would touch this startup for a Series B round. No VCs at all. Even a PE firm wouldn’t buy it with no growth at all, I don’t think. But even if you’re out of ideas for now, don’t give up all hope of a potentially decent M&A offer, especially if you are cash-flow neutral and haven’t raised too much (that’s important). If you’re in an important space, someone may still want you. Just keep doing what matters, and what keeps your customers happy. (read more…)

CATEGORY: leadership, resilience, valuation

November 8, 2023 Open View Partners : 2023 SaaS Benchmarks Report

1. While growth is much harder to come by in 2023, there are pockets of resilience amid the doom-and-gloom.
2. The North Star for many has become ARR per FTE, which reflects the productivity of your team. We’ve seen big increases in ARR per FTE year-on-year.
3. Positioning yourself as “AI” doesn’t impact growth. But monetizing AI does.
4. To drive productivity, companies need efficient product-led growth (PLG), expansion within the customer base, and improved operations.

CATEGORY: leadership, profitability, resilience, SaaS

August 24, 2023 Pitchbook : Q3 2023 Allocator Solutions: Evaluating Persistence in Fund Performance

Overall, we found that strong performance in a family's prior funds was correlated with strong performance in successor funds to some degree, but that's when looking at the most recent available returns data. To be useful for the allocator's decision to invest, persistency must be predictive at the time a new commitment can be made. The issue―which we and others have found―is that early IRRs are notoriously unreliable indicators of where a fund's performance eventually ends up. At the time the next sequence in the family is fundraising, the predecessor fund is on average only 3.5 years old, leading to a high degree of drift from that time to its final IRR. We find that, after controlling for information on prior fund family returns that was available at the time a successor was fundraising, the predictive power of a GP's track record is near zero. (read more…)

CATEGORY: capital, leadership, VC

January 12, 2023 Anu Atluru via Substack : Rise of the Silicon Valley Small Business

The Silicon Valley small business, the SV-SB, is a hybrid of sorts — it intertwines small business values and discipline with big tech know-how and ambition. Founding teams may look like that of a “traditional” Silicon Valley startup. They’re native to Silicon Valley ethos, skills, and playbooks. But, beneath the surface, they’re different. You might see more solopreneurs and studios (and LLCs instead of C-corps). They value autonomy and flexibility. They envision a range of potentially good outcomes — not binary, all-or-nothing scenarios. (read more…)

CATEGORY: bootstrap, leadership, resilience

October 14, 2022 Sifted : Who are VCs kidding with their phony fund sizes?

I’ve seen everything from funds announced in the media that aren’t even incorporated yet, pre-first close funds announcing the target size of the fund as being raised or, to make it a bit more concrete, firms announcing their fund size when they only have like 0.02% of the capital effectively raised. I love the hustle mindset; truly. But I also love transparency and honesty. And I dare say I love integrity above all. This behaviour has real consequences on our beloved venture ecosystem — most of them negative. LPs should be held accountable because they should reference check before building any type of conviction. VC investors should be held accountable because they just shouldn’t be doing this! Ecosystem builders (accelerators, incubators, tech event organisers, etc) should be held accountable to cross-check before inviting “pseudo” VCs to their events, pitch days, panels and so on. Media should be held accountable because journalists have a responsibility to interrogate news and not just print whatever is fed to them. Founders should be held accountable because they should publicly call out the VCs who do misrepresent themselves, just as much as they should celebrate the VCs who are doing good work. (read more…)

CATEGORY: capital, leadership, VC

September 22, 2022 Pitchbook : Down Rounds, Impacts, and Exit Opportunities

Companies taking on a down round often continue growth. Just 13% of companies raising a down round from 2008 to 2014 were unable to raise a new round or exit immediately after the down valuation investment. Nearly 20% of post-down round exits occur via PE buyout, which is a significantly higher proportion than what is seen in the broader venture exit dataset. The data also shows that investing into a down round could prove to be an investment strategy with decent returns. The fact that 88% of known exit valuations for companies taking a down round were higher than the down round valuation should increase the confidence in down round participants. (read more…)

CATEGORY: downturn, leadership, resilience

June 17, 2022 Crunchbase : Surviving Down Rounds

Raising money at a sky-high valuation feels like a big win on the day you close. But it also raises expectations that much higher. The consequences of failure are asymmetric. If you stumble and need a down round, the VCs just write a check or even buy more on sale. Whereas you can lose all your shares, all your vesting, or even your job. Those are years you cannot replace. So be prudent. Leave enough room to be sure of raising the share price in the future, even if you make mistakes and even if the markets are down. In short, enjoy your swim. Just please keep your suit on. (read more…)

CATEGORY: downturn, leadership, resilience