188. #1 Killer of Startups feat. Eric Marcoullier Artwork

VC Minute

Quick advice to help startup founders fundraise better. Founders, do you feel like you're fundraising on an uneven playing field? You are. The VC minute is here to help you level up. Venture capitalists navigate pitches and negotiate investments every day. They know the ins and outs and are up-to-date on the current funding environment. But as a founder, it may be your first foray into fundraising, and no matter how much success you've had in other areas nothing truly prepares you for the fundraising journey. The VC Minute was created to help founders close this gap. While it may seem like securing an investment at the seed stage is mostly driven by luck, there are steps founders can take to increase the odds of successfully raising a round. And that's what we're going to cover on the VC Minute through a series of short episodes. I'm going to share with you insights to help navigate the seed stage financing dynamics. I'm Rich Maloy, Managing Partner at SpringTime Ventures with 25 years business experience a dozen years in the startup ecosystem. I've applied my experience from sales, finance, and venture investing, to help startup founders fundraise better.

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VC Minute

188. #1 Killer of Startups feat. Eric Marcoullier

February 27, 2024 • Eric Marcoullier • Season 4 • Episode 188

0:00 | 2:47

Text your thoughts directly to Rich.

Founders are efficiency-seeking missiles, which is what compels them to start businesses, but it's a double-edged sword.

About Eric Marcoullier
Eric coaches first- and second-time tech CEOs, keeping their companies alive long enough to get lucky, figure out their business, find product/market fit and replace his ass with someone who knows how to scale companies beyond $5M in ARR. His work primarily involves challenging business assumptions, providing frameworks for new situations and distilling complexity down to basic, actionable ideas. If you'd like to learn more about his coaching, visit www.marcoullier.com or www.linkedin.com/in/bpm140

About AVL Growth Partners
AVL Growth Partners, founded in 2009, is the leading fractional Finance and Accounting firm supporting organizations in pivoting from growth to scale. AVL brings an experienced team of CFOs, Controllers, and Accountants to your organization, delivering transparent, strategic actions for short and long-term success. Transform your financial approach affordably with AVL, supporting companies coast to coast - get to know AVL Growth Partners at avlgrowth.com. (Sponsored)

About SpringTime Ventures
SpringTime Ventures seeds high-growth startups in healthcare, fintech & insurtech, and logistics & supply chain. We look for founders with domain expertise, forging a path with a truly transformative technology. We only invest in software-based businesses in the USA. We bring a people-focused approach, work quickly, and reach conviction independently. Our initial check size is $600k. You can learn more about us and our approach.

Eric Marcoullier 0:01

As a startup coach, I have a whole suite of different "number one thing that kills companies." My long term clients will go, dude, that's the third one you've said this month. So take this with a grain of salt, but not a very big grain of salt. The number 1 killer of startups is solving problems that aren't yet problems. As founders, we are efficiency seeking missiles. We go into the world and we see things that could be better and we want to solve them. And that's the reason the companies are boring. And so we hire a couple of people or even better. We just convince a couple of people to go build something with us. Maybe we even convince some investors to come along for the ride. And six months in we get really, really frustrated about managing our sales pipeline. And we think, you know, what would be great? We can solve that too. We're efficiency seeking missiles and we're really smart. So let's go solve that problem. Let's go spend some of our very scarce resources, but time and money on solving that problem. It's probably going to kill your company. You're going to run out of money solving a problem that wasn't really an issue right now. Or you think about that classic founder trope of you want to build a company or you want to build your software in a way that scales from day one. No janky PHP set up. We don't use MySQL cause you know, MySQL is not scalable in the hundreds of millions of rows. We need all this fancy technology. And then you launch and hey, nobody comes. Because launching is the easy part. Building the customer base, that's the hard part. So you can spend most of your resources, making sure that you've built a product that's scalable, that never gets used. And hell, if you could take that money back and just extend the runway so that you could actually figure out how to sell, maybe you'd still be alive. I am a huge believer in getting things out as quick and dirty as possible to see whether or not they matter and solve those problems when they actually show up. Don't try and prove that you're smart by hitting them preemptively. And the one thing that you and I, Rich, are both old enough to remember is back in, call it 2011, 2010, the fail whale. When you'd go to Twitter and Twitter couldn't couldn't scale and hell man they just give you a picture of a whale getting lifted in a net by little Twitter birds. If I remember correctly, that company went public and was even acquired recently for 44 billion dollars. They didn't scale early on and it didn't kill them. It's probably not going to kill your company either.

Rich Maloy

Host