Series A investors now expect founders to show a path to a $5 billion company. Only 20-25% of seed-funded startups will graduate to Series A. Founders can chase VC growth targets or build toward profitability instead.
If you don't think you're building a $5 billion company and it's not clear to investors you're building a $5 billion company, the Series A market is probably going to be closed to you. Series A graduation rates are going to come down to 20 to 25%. And even that was probably optimistic. So I think in that world, I talk to a lot of companies and say, you have 2 choices. You can try to read a very fickle VC market, or you can take your destiny into your own hands and you can focus on either profitable growth or finding capital providers who don't need companies to go from $0 to $100 million in ARR in 18 months.
