If a cat is scared, it can hide under the sofa; a startled fish will swim into a dark hole. And when people feel uncomfortable, we tell ourselves stories.
For example, “growth at all costs” is a fairy tale made possible by cheap money that helped venture capitalists set expectations for founders—and each other—for years.
“Grow at all costs” is a fairytale made possible by cheap money that helped VCs set expectations for founders – and each other.
Likewise, “everyone needs 18-24 months runway” is a nice motto, but if it takes three times longer to lift a round than it used to, it may no longer be useful advice.
“These ‘VCisms’, born of an era of plenty, have permeated boardrooms and investor meetings everywhere,” said Rebecca Mitchem, partner of Neotribes Ventures, in a ExamPaper+ post this morning.
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“It’s time to ask ourselves if these VCisms are still relevant or if it’s time to change.”
In a data-driven piece that looks at post-money valuations, deal sizes and dilution rates going back to 2012, Mitchem says we are now entering a new era where the tech industry will embrace “growth at a reasonable cost.”
Founders may continue to tone down their ownership by pursuing fat rounds, or they may decide to grow more slowly, giving greater stake to all involved over time.
“While it may feel counterintuitive given the recent market environment, equity value for all parties – investors, founders and employees – is higher in the more conservative growth scenario,” says Mitchem.
Thank you so much for reading TC+ this week,
Editorial Manager, ExamPaper+
6 investors discuss why AI is more than just a buzzword in biotech
Biotech companies are leveraging AI and machine learning at scale to reduce R&D spend and get products to market faster, but “the bigger demand for investors is getting a better understanding of exactly what AI is trying to model and predict,” says Shaq Vayda, director at Lux Capital.
In her most recent investor survey, Anna Heim spoke to six biotech investors about where AI creates value, near-term market shifts and how they want to be approached by founders:
- Robert Mittendorff, MD, general partner and chief of healthcare, B Capital
- James Coates, director of health and human performance, key point
- Shaq Vayda, Director, Lux Capital
- Franck Lescure, partner, Elaia Partners
- Francisco Dopazo, Managing Partner, Humboldt Fund
- Sarah Guo, Founder Conviction
Which Instagram ad placement is more cost-effective: Reels, Feed Posts or Stories?
Consumer-focused startups are spending more on platforms like TikTok and Instagram to reach customers, but which ad products offer the best returns?
In a case study based on Instagram campaigns for a site that facilitates bookings for freelance beauty professionals, digital marketer Angelina Liparteliani looked at Instagram Reels, Feed Posts and Stories.
Her highly detailed breakdown includes examples of the ads used in different campaigns, the process she used to optimize creatives, and a cost-per-click analysis showing how she reduced CPC from $1.51 to 17 cent.
“Don’t go chasing trends,” advises Liparteliani. “Diverse your advertising strategy, test different ideas and don’t give up if your ad doesn’t show results right away.”
Pitch Deck Teardown: MedCrypt’s $25 Million Series B Deck
Many medical devices are just as vulnerable to cybersecurity threats as other IoT products. That’s why MedCrypt, a Y Combinator graduate, creates software to protect patients.
The company predicts that manufacturers will need to secure $1 trillion worth of “new and legacy” devices over the next three years, a truly enticing TAM.
After editing some details about customer adoption, MedCrypt’s founders shared with TC+ the 12-slide deck that helped it raise a $25 million Series B:
- Cover slide
- Problem slide
- Target group/market size dia
- Occasion slide
- Mission slide
- Product slide: Tracking vulnerabilities
- Product Slide: Behavior Monitoring
- Product Slide: Cryptography
- Product slide: MedISAO
- Team slide
- Summary/traction slide
Dear Sophie: When can I register my employee for the H-1B lottery?
We are a pre-seed startup thinking about sponsoring an early worker’s H-1B visa to stay in the US and work for us.
How does the process work?
— Looking in San Mateo
A guide to your first 90 days as a new CISO
I’m used to working under pressure, but taking on a job as chief information security officer sounds extremely stressful: people are much more likely to learn about your failures than your successes.
Managing the cybersecurity needs of an entire organization is “a big job that touches just about every part of the organization,” said Heather Gantt-Evans, CISO at SailPoint.
She has written a guide for inbound CISOs that includes a framework for setting goals, creating action plans and, most importantly, documenting risk.
“The first 90 days of a new CISO’s term are critical,” writes Gantt-Evans. “They’re the best opportunity you’ll ever have to research, collect documentation, and assess where things stand and how they can be improved.”
In a turbulent market, it’s time to be methodical about selling
Many SaaS sales teams haven’t worked in an environment where so many customers are cutting back, and it shows: When everyone’s in the mood to buy, it’s less important to develop a critical understanding of your customer’s needs.
“Salespeople shouldn’t just push features,” advises Steve Goldberg, chief revenue officer at Salesloft. “They should illustrate the unsustainable nature of a customer’s current behavior and processes.”
In this post, Goldberg looks at MEDDPICC and design thinking, two sales methods that are “particularly effective in difficult times.”