Fundraising isn't predictable

However, at the same time, the cargo culting creates inefficiencies and a lot of group pressure which forces companies to conform to the metrics du jour to raise funds. From a vantage point outside of the industry, these metrics feel almost memetic in nature. It seems that a lot of these hoops exist because other people have used these set of hoops before, therefore they must be valid in some shape or form. It's a recursive sort of logic whereby the rationale behind an investment metric is reinforced by the social signals around it. Plus, I'm sure that it doesn't help that most VCs don't actually have a quant styled background and most VCs don't model their investments in any shape or form. (while the modeling may not be accurate - it is still a useful tool for thinking through investments)

Of course all of this is actually an opportunity for the enterprising VC. A smart VC firm could theoretically create a better, more quantitative process and pick up unconventional companies for cheaper and get better returns as a result.

edit: Just in case it wasn't clear, I'm not accusing the OP of cargo culting - it's rather the opposite. It's more of a meta-observation / addendum to his observations.

I'm always dubious of these sorts of metrics.

I think if a founder speaks to a small handful of VCs and/or other knowledgable startup people: they can get a good sense of how easy or difficult fundraising will be...and that will be more useful than any one guideline that can be provided. Series A lead VCs need to see a potential path to $100 million in revenue going to $300 million to be a home run...and a combination of the team/product/market/traction combo gives an investor the necessary conviction and excitement to propose an investment.

The limitation with growth + revenue guidelines for fundraising is that it will never be enough information as there are so many factors that go into an investment decision. And there has been a proliferation of startups that reach $1 million in revenue growing ~15% a month and still the vast majority won't get to the scale that makes a series A VC happy.

As a side note, I'd love to see any company with "Engagement rates that are higher than Facebook" that can't fundraise. :) I think there may be some off the charts positive indicators: team with incredible track record, off the charts engagement + retention in a large market, amazing unit economics + high growth that the ability to fundraise is all but inevitable.

But I see this type of sweet/safe/simple advice post so often on many sites. The tone reads like how one would talk to a child while trying to be careful not to hurt their feelings or confuse them.

I realize many founders are young with limited experience, maybe even still in school. And there's no reason to be rude about things. But who is the audience for these types of advice posts with this level of handholding?...

Are there would-be founders out there pretty much ready to be in charge of millions of dollars of other people's money, ready to hire strangers, ready to figure out finding/keeping customers, ready to stave off ruthless competitors, but don't yet know that many things in life and in business can be complex and are not predictable and they need this explained??

Also I am quite sure one can explain life and business are complex and not predictable - and so obviously a single metric like $1mm ARR doesn't guarantee funding or anything - without having to borrow (the much more confusing topic) of parametric insurance as part of the explanation...

For a VC screening, if a founder needs such simple, obvious advice and handholding, doesn't that speak to bigger issues?

Again, really really appreciate when VCs share their knowledge and experience, just sometimes when I see the advice they do give I wonder who/how many founders are they meeting who lack such basic knowledge and common sense and need things explained like this.

>Repeat founders who were previously funded

Interesting. I applied to YC with https://icanpriceit.com/, not much traction yet. I was hoping I'd get an interview at least, based in part on my existing experience of building an ecommerce/Amazon business to 100k in sales (plus my answer to the "hack" question was pretty good).

I didn't get invited. I know that https://www.ycombinator.com/whynot/ says I pretty much can't get a direct answer why, but my own takeaways were that one of the following must be true. Either:

1. Solo founder+no traction was just too low to meet their bar.

2. I messed up some other part of the application, which is very possible.

or 3. 100k in sales isn't that impressive, relative to the kinds of impressive things other founders did; and the fact that it's not the startup I applied under dilutes the achievement.

Now in the month and a half since I applied, sales (on my amazon business) have jumped and I'm looking at close to a $1 million ARR (~$4500 sales today, ~$22500 sales 7 days, ~$78000 sales 30 days, majority of which are from nonseasonal, replenished products, so can reasonably extrapolate yearly i.e. no Q4 boost). Maybe in 5 months that will be impressive enough to get an invite, at least, assuming I still want YC. Without funding I likely won't be doing too much work on the startup and will mostly focus on my existing business and college.

(I actually talked to Aaron briefly after a talk in NYC, he said I shouldn't worry too much about being a solo founder.)