TLDR:
It’s not difficult to raise venture capital after a rough patch if growth reaccelerates. VCs typically need to see at least 3 months of continuous, strong growth. It’s important to have proof that things have changed before seeking funding.
Some key points from the article:
- Raising money after a rough patch is possible if growth picks up
- VCs typically require at least 3 months of sustained growth before funding
- Proving a change in performance is essential before seeking investment
- VCs prefer startups with consistent growth over a few months before funding
It’s crucial to demonstrate a positive trend in growth before approaching VCs for funding.
It is recommended to show at least 3-4 months of growth before seeking a VC round.
Full Article:
According to a post by Jason Lemkin on SaaStr, raising venture capital after a challenging period is feasible if growth rebounds. Venture capitalists typically require at least three months of sustained and significant growth as proof that the startup is back on track. VCs understand that most startups face difficulties at some point, but they need reassurance that the startup is heading in the right direction.
The article emphasizes the importance of showcasing a positive trend in growth before seeking funding. Startups that can demonstrate three to four months of consistent growth are more likely to attract VC investments. It is crucial to provide evidence of a change in performance to instill confidence in potential investors.
The post highlights the significance of proving to VCs that the startup has overcome its challenges and is now on a growth trajectory. By showing a clear upward trend in growth metrics, startups can enhance their chances of securing funding. The article also mentions that VCs are more inclined to fund startups with a track record of sustained growth over a few months.
