The least told founder story in startup-land:

📅 Eight years in
🌟 Product being lapped by new entrants
🪙 Good not great revenue, moderate growth
⚖️ Teetering on edge of profitability
🐜 Team is antsy, harder to retain/recruit
🔒 Overvalued in prior fundraise, limited exit ops
The last point can be brutal.

The founder has a responsibility to VCs, but more importantly, to the team to "land the plane," but has fewer resources to do so.

There's also sunk cost and reputational anxiety, and the pressure of rapidly diminishing career EV.
Compound this with the bitter sting of the memory of a previous M&A offer for an eight-figure exit that was blocked by VCs who offered encouragement to go big (and threatened to exercise blocking rights if the founder did not).
Thanks to @garrytan for signal boosting this thread. His point is spot on. Careless selection of investors – and investment of VC dollars – are the primary cause of this condition. https://twitter.com/garrytan/status/1285739299078500354
This scenario can often be especially deflating because it's often founders who got out of the gate strong that end up this way.

Early traction made them a hot commodity before the business really got figured out, a high-valuation round followed, and then the flywheel stalls...
It's good for founders to be ambitious, but they shouldn't be reckless.

Some VCs will try to "foie gras" dollars into promising startups. They're happy to leave 19 "craters" in the ground for the chance to back one Stripe.

But each of those "craters" is someone's career!
If you take one lesson from this thread, I hope it's, "Don't think like a VC unless you are a VC."

VC is arguably more transparent than any other area of finance, but founders shouldn't internalize VC logic. https://twitter.com/josephflaherty/status/1285251869019901952
Entrepreneurs and VCs have different sets of victory conditions. In the best scenario, they overlap.

However, it's important to remember a "failure" in a VC's eyes can set a founder up with generational wealth.

That optionality should be guarded jealously!
You can follow @josephflaherty.
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