Most VCs have moved on from “traditional” B2B SaaS companies and are focused on AI-first companies.

It’s nothing personal; it’s simple math.

Most B2B SaaS companies will not double revenues yearly for the next 5-10 years, even if they add AI to their feature set.

This growth rate is required to create enough enterprise value, accounting for additional funding rounds, to hit VC-scale returns.

The exit market is now paying 5-15X revenue on average for high-quality SaaS businesses.

It’s just hard to invest a lot of money in an early-stage SaaS company, massively increase its growth rate, and get crazy exit multiples.

It’s not impossible. It’s just really rare. (More rare than previously low VC win rates.)

VCs know this. So B2B SaaS investments have slowed down at every stage.

VCs are moving on to the AI-first tech world, where they can invest a lot of money, and a couple of the 20 companies they invest in could win very big.

That’s the VC game. It’s a blockbuster, all-or-nothing bet.

That is why practical early-stage investors are stepping in with smaller checks at reasonable valuations to achieve efficient growth and a modern exit multiple.

Practical SaaS founders are growing solid businesses with little or no outside funding, so they can sell their companies for founder-scale exits when it makes sense for the founders.

B2B SaaS is now a PE-style game, for the most part.

PE investors (and PE-backed strategics) love 25-50% predictable growth, some profits, efficient CAC and operations, and ready buyers when the company grows bigger in 5 years when they can sell it for a slightly higher multiple.

• That’s what a great B2B SaaS company looks like now.
• That’s what’s healthy and interesting to serious SaaS founders.
• That’s what buyers are paying market-rate multiples for all day long.

The first rule of the game is to know what game you are playing.

Choose wisely.