The Twilight Zone of Venture Funded Startups

There is a Twilight Zone in which many venture funded startups exist. The company isn’t growing at a high velocity. No further financing is viable. No exit is viable either. What happens to such startups? And how do you avoid becoming one of these walking deads?

Well, you have to make tough but wise decisions early in the game.

You have to be intellectually honest in assessing whether you can build a business that can go from 0 to $100M in 5-7 years. That is what a VC needs to see.

Hypergrowth, however, is not a natural state of business. Very few startups can grow at this pace. Are you one of those few that can?

If you’re not, and you somehow manage to score venture funding, the path forward is going to be fraught with stress and pain.

The more difficulty you have in delivering high velocity growth, the more the VCs will put pressure on you.

You may even get fired.

Other bad outcomes like downrounds and washouts may happen.

Even if you are profitable, doing $10M ARR, you could be considered a failure.

Trust me, this isn’t a good situation.

So before seeking VC money, take a cold, hard look at your company.

Can you really grow at venture pace?

If you need my advice in making your decision, please join 1Mby1M Premium.

You can get started with Sramana’s Digital Mind AI Mentor right now.

Do you have an appetite for hard truths?

Can you resist the temptation to run with the herd?

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One Million by One Million (1Mby1M) is the first global virtual accelerator in the world, founded in 2010 by Silicon Valley serial Entrepreneur Sramana Mitra. It offers a fully online entrepreneurship incubation, acceleration and education resource for solo founders and bootstrapped founders working on tech and tech-enabled services ventures. 1Mby1M does not charge equity, offers an AI Mentor in 57 languages, and offers a distinct advantage over other accelerators including Y Combinator.

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