Episode description

Dave Lambert and the team at Right Side Capital Management are the most active venture capital investors, having invested in over 2,000 startups since 2009.

Right Side Capital is a “pre-VC” institutional investor that operates very differently from traditional VCs: investing when SaaS companies have just a little revenue using a submission form on their website, then responding quickly and making investment decisions in a week. They also invest in practical SaaS founders with capital-efficient approaches who expect to sell their companies someday for less than $100M.

In this expert episode, Dave shares practical insights for SaaS founders who don’t expect to play the big VC funding game:

• Why raising Series A or B funding rounds from VCs reduces your odds of a successful exit
• What founders should be focused on when they get their first customers and revenue
• Why most VCs don’t invest when you have just a few customers and a little revenue
• How the founders they invested in are using AI technology to grow more efficiently
• What’s happening right now with acquisitions of SaaS companies for $25-$100M enterprise value

“More often than not, at the stages that we’re investing and someone has $4K, $8K, $20K MRR, the founders are still supremely confident and think they figured out their exact ICP and how it’s going to grow in scale. They think, We’re just going to take your money, and it’s going to be straight up from here. And it never does, or almost never does.

“We’re having conversations with founders where we’re sharing, Hey, just so you know, 90% of our companies miss their revenue targets massively in their first year. So you should assume that you are going to as well.

“But guess what? They all spend exactly what they thought they were gonna spend or more, usually. Just know that that’s gonna be the case and have a plan for where you’re still alive if things don’t go as expected.”

• Dave Lambert on LinkedIn
• Right Side Capital Management on LinkedIn
• Right Side Capital Management website

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