Met a close friend who’s also a seed stage founder today..
They have been growing but runway is dwindling and he wanted advice on what he should do next. Stellar customers, getting close to a $1M in revenue. Not a rocket ship, but not bad at all. He thinks he’s a bit early since the models haven’t caught up to the capabilities he wants but he also really feels the opportunity cost.
I have this same exact conversation at least 2x a week.
In this moment, you only have essentially three options:
1) if you have intense belief in the company, be a cockroach and get to default profitable. once the capabilities get there, you feel the demand, then go raise a large round and go for the jugular.
2) find an orthogonal area that is much more relevant and growing like crazy. ride the coat tails of new existing capabilities and push hard to capture them quickly using unfair advantages. and if you don’t have that, then..
3) sell / get acquihired and join a far more ambitious company that has figured out a lot of the things you haven’t. And then get back to starting a new company 1-2 years later when you find the next thing you want to build.
It’s hard but honestly those are the three options you have. And it really depends what category you’re in. The bar continues to get harder every month on how to cross the chasm from seed -> series A. The old school metrics are just not relevant anymore and in this consensus market there’s only a few categories where there’s tremendous pull on the VC front.
You could lament that this is the state of the market, but it’s better to know it’s happening than be oblivious on what is actually happening.
I get to share this directly which makes me uncomfortable but at least someone has to say it out loud 🙈