Your startup idea probably isn’t venture-scale

Ingredient 1: The problem is important to people

There need to be a lot of people willing to spend a lot of money to solve the problem. Most startups fail not because the idea isn’t good but because the market for the solution is just too small. If you want to build a venture-scale business, a rule of thumb is that there needs to be a clear path to... See more

As a seed-stage investor at First Round Capital, I get to meet a lot of founders who are exploring and validating their ideas. It’s an exciting time for them and, as a former founder myself, I relate to the thrill and anxiety of just getting started. You believe you’re onto something and feel ready to bring your idea to life, but there’s also a lot... See more

I should mention one sort of initial tactic that usually doesn't work: the Big Launch. I occasionally meet founders who seem to believe startups are projectiles rather than powered aircraft, and that they'll make it big if and only if they're launched with sufficient initial velocity. They want to launch simultaneously in 8 different publications, ... See more

The question to ask about an early stage startup is not "is this company taking over the world?" but "how big could this company get if the founders did the right things?"

One thing that seems to have been forgotten over the past few years: venture capital isn’t a fit for every company. It’s not a fit for *most* companies. Venture is structurally built for the moonshots. The asset class is predicated on the power law, on high loss ratios, on what… Show more

The question to ask about an early stage startup is not "is this company taking over the world?" but "how big could this company get if the founders did the right things?" And the right things often seem both laborious and inconsequential at the time.