In the past two years, there has been a shift in what will get an investor to write a check.  It is all coming down to hard evidence of revenue, of a modest customer acquisition cost, of an experienced team, and of being able to grow sales 100% per year for at least a few years.  This applies to companies looking for seed rounds all the way through Series A rounds.  And the bar is even higher if you don’t have AI somewhere in your story.  That is the conclusion in a recent article by an analyst who has been combing through the numbers of founders who actually got checks in the past year or two.  It is worth a read.

 

Ideas are not being funded.  Founders need much more than ten good slides.  Here’s a quote from the article:

 

“The old model prepared founders to pitch a compelling story and a credible team. The new model requires founders to walk in with evidence. Revenue signals. Unit economics. A technical architecture that can scale. A clear answer to the AI question. Most of our [accelerator] programs aren’t built to help founders develop those things. We’re still running pitch or investor prep.”

 

CleanStart has been following this trend for some time. It is one reason we created our Deep Dive Accelerator last year to go beyond the training we had been giving. We are finding more coaches and gathering more insights from successful founders to help founders one-on-one find that evidence.

 

If you are wondering what this could mean for your startup, set up a Zoom call with us to explore what you need to do to succeed in this new environment. It could be one of the more important meetings you will have.