Comment by orthoxerox
2 years ago
That's the whole point of startups and VC: not spending money on safe investments that provide a 10% return, but spending large amounts of money on risky investments that provide, when averaged together (rare unicorns on top of a mound of dead startups), a 20% return. Both numbers completely arbitrary, of course.
Isn't this only the latest definition of "startup"? What exactly defines a startup? Is it growth at all costs? Is it reckless spending? Complete focus on short-term gains? Something else?
These investment rounds are only there to provide money to start. Unless the founders sign away the control of their company to investors, they are still at the helm of the ship. They can choose how they will approach growth.
We can see how the entire scene is gearing towards profitability now that the money dried up, so this growth focus is no longer the only game in town.
You can still take investments and accelerate growth without having to recklessly go all-in. But I've never taken VC money. Maybe that's baked into the contracts?