Tim DraperFounder and Managing Partne, Draper Associate · I back the ideas that look crazy first

What would you do with Extra Capital for your business? #shorts

19 Apr 2024 · 1 min

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0:57

Tim Draper talks with a founder about how to use extra capital. Rather than aggressive hiring, the founder plans to modestly scale the tech team and hit break-even within 12 months by increasing recurring transactions.

With the extra capital for which you're here, what would that enable you to do?
The extra capital would enable us to scale our team. So right now we have 40 people in our team, a significant proportion of which is focused on building the technology.
Scale our team sort of scares a venture capitalist going into a bear market. What's your thinking there?
I think I just went with a knee-jerk response of, I was still thinking that the appropriate narrative to sell is one that's just optimizing for growth.
Might've created the interpretation that we're tone deaf.
It's not an aggressive scaling. I think the point at which, at which we are, we already have significant momentum with some of these leading brands. So this is actually a plateauing of costs where our revenues will continue to scale. So it's not a perpetual scaling of our team. Our view is that over the next 12 months, we can actually get closer to break even and drive profitability by processing more recurring transactions.
Why can't you break even now?