Eric Siu explains why startups that raise less money often grow revenue faster than well-funded ones. Limited runway forces focus and grit, while too much cash breeds complacency. He uses fitness analogies to show how constraints build strength.
I actually have the graph over here on startups that raise less money grow revenue faster. So other than the smallest startups, companies that raise less than 12 months of runway generally experience substantially more revenue growth than those raising more than 18 months worth of runway. It's impossible to infer too much from a few bars on a chart, but one implication is that less is in fact more when it comes to funding. Why might that be? Because if you have 12 months of runway or less, then you have neither the time nor the money to be complacent. Getting a little gritty might just be the key to survival. So sometimes, you know, it's like you wake up in the morning, you go to the gym, you're putting some stress on your body, You go to the sauna, you maybe do the cold plunge, right? You're getting your body ready for battle. But when you raise too much, you get fat and lazy. That's what happens sometimes.
