I believe that we are currently seeing a new breed of founders emerge ...
I admire every founder for daring to go on that crazy ride - giving up the security of a paycheck, the comfort of having a business card of a well known brand or the fun of managing a large team. And I admire them even more so, when times are tough - like they are right now.
In order to start something from scratch, you have to willingly turn a blind eye on the risks - otherwise you will never start. Yet, you have to be mentally prepared for all the hard times and equipped with tons of grit to keep plowing forward while everyone tells you “no”.
And I firmly believe that 2024 will bring forward some really amazing companies, built by founders who combine exactly that. Judging from what I have seen over the last 3 months, we are on a great track!
I believe that the fact that tougher times are bringing forward a new breed of founders:
Founders who are better equipped for the tough times: It was never easy to build a company. But if you kept reading startup news in 2020 and 2021 you could get carried away by 100mn seed rounds, 13 months journeys to unicorn-land, subsequent funding rounds that are only months apart. You could almost get delusional. The news of the last 2 years have been filled with the ugly truths of entrepreneurship and made us all more aware of how hard and bumpy the ride is - even for the most successful companies.
Founders who focus on real problems: As budgets of consumers and businesses are tighter, uncertainty keeps lingering and investors ask more painful questions during due diligence, focus is increasingly and rightfully so shifting towards businesses that solve real problems. Earlier monetization is key in tighter markets, i.e. an early product already has to solve a large enough pain for customers in order to win.
Founders who build with reasonable burn rates: In light of rising costs of capital and somewhat smaller round sizes and longer times to close fundraising rounds drive the focus on managing burn efficiently and only spending on what creates value. This may mean that businesses grow more sustainably - one obviously has to manage the risk of scaling too slowly though!
I find these things very encouraging to witness. And on days like today they are particularly visible - we are just weeks away from kicking off things with a new founder residency across Amsterdam, Berlin and Munich. We are currently plowing through the final wave of applications - let’s roll!
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