A Dallas software founder asked me this on our quarterly call today:
“How can our company look serious and credible when we haven’t raised a big funding round?”
He started his vertical market B2B SaaS business in March of 2020.
Now they have over 100 happy customers, $55K MRR, and 20% monthly growth. They will hit $1M ARR within 6 months.
And they haven’t raised big outside funding.
Despite their great progress, he feels like the world is keeping score by how much outside funding they have raised.
His company hasn’t gotten attention in the local tech press without a big funding announcement.
When he talks to funded founders and local tech leaders, the first question is “How much have you raised?”
He knows he’s on the right track with his customers, his employees, and his growth plan without outside funding for a while.
But “How much funding do you have?” is easier to talk about in the chatter-verse than “How big is your business and how fast are you growing?”
My advice to him:
“Hang in there and keep doing what you are doing. Keep growing and learning and building.
There are many successful SaaS companies and founders who haven’t raised big rounds. You just don’t hear about them in the tech news or at funding events.
When and if you’re ready to grow faster on your own terms with efficient outside funding, you’ll be in the driver’s seat.
Funding will easily follow your great business and your clear plan.
Funding isn’t the game. It’s only the fuel for your growth game.”
What would you tell him? (He’s listening.)