After raising a $5M seed round, Doppel kept its team lean at just five people. The founders realized their bottleneck wasn't engineering capacity but founder-led sales and product discovery. This preserved capital while they iterated towards a scalable GTM motion.
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The old model of raising a large sum of money to build infrastructure is obsolete. Today, founders can and should validate their product and find customers with minimal capital *before* seeking significant investment, reversing the traditional order of operations.
During capital-constrained periods, founders must be ruthless in their focus. Every dollar and hour should go towards "killer experiments"—those that directly accrue value and hit the specific milestones required for the next fundraising round. "Cool science" that doesn't advance these goals is a luxury companies can't afford.
Precursor Ventures makes "directional people bets" by investing smaller checks ($150-250K) in top-tier founders to fund their search for a viable business concept. This strategy prioritizes founder quality over the initial idea, recognizing that great founders can pivot to find product-market fit.
Resist hiring quickly after finding traction. Instead, 'hire painfully slowly' and assemble an initial 'MVP Crew' — a small, self-sufficient team with all skills needed to build, market, and sell the product end-to-end. This establishes a core DNA of speed and execution before scaling.
Merge's founder views the seed round not just as a capital raise but as a test of street smarts and sales skills. How a founder manages intros, creates FOMO, and navigates the "dating game" with VCs is a direct indicator of their future success in acquiring actual customers.
Investors like Stacy Brown-Philpot and Aileen Lee now expect founders to demonstrate a clear, rapid path to massive scale early on. The old assumption that the next funding round would solve for scalability is gone; proof is required upfront.
By staying as a two-person technical team, Decagon's founders maintained extreme agility. They spent days talking to customers and nights coding, allowing them to iterate rapidly to product-market fit without the overhead of recruiting or managing a team.
Despite a $50 million exit from their previous company, the Everflow founders intentionally limited their initial investment to a few hundred thousand dollars and didn't take salaries for two years. They believed capital scarcity forces focus and efficiency, preventing wasteful spending while they were still figuring out the product.
Despite low initial revenue per employee, Kukun purposefully front-loaded investment in engineering and data (42 of 55 staff), with only two salespeople. This "build the motor first" strategy was designed to perfect the product before scaling sales, managing burn by offshoring 85% of the team. This was a deliberate, sequential growth plan.
Founders mistakenly believe large funding rounds create market pull. Instead, raise minimally to survive until you find a 'wave' or 'dam.' Once demand is so strong you can't keep up with demo requests, then raise a large round to scale operations and capture the opportunity.
