For early-stage startups, generating revenue and driving growth trump chasing venture capital (VC) funding. In 2023-2025, VC funding trends underscore this shift. Global VC investment plummeted from $381B in 2022 to $221B in 2023, with 2024 seeing only a modest rebound to $314B, largely driven by AI megadeals. Investors now prioritize startups with proven revenue streams and strong fundamentals over non-revenue ventures. In 2023, 770 startups shut down due to a harsh funding climate starving seed-stage firm. VCs shun non-revenue startups, favoring those with $2M+ in annual recurring revenue, doubling prior benchmarks. Long scalability tenures also deter funding, as investors seek quicker exits amid an 8-year unicorn holding period backlog. Revenue signals product-market fit and sustainability, reducing reliance on fickle VC cash. In 2025, focus on customer-driven growthโVCs reward real traction, not just big dreams.
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