"Pegasus" Startups?
https://calacanis.com/2019/09/09/the-pegasus-startup-flying-over-vcs-on-the-wings-of-profits/
Saw this really interesting post by Jason Calacanis this morning, a well-known angel investor in San Francisco.
It seems like investors are shifting toward focusing on investing in companies that are already generating significant revenue - maybe the days of "we'll figure out the business model later" are actually coming to an end.
Sounds a lot like a successful Indie Hacker company to me.
What does everyone think about this trend? Part of me feels like this is risk-aversion on the part of investors, but I'm also glad to see more attention for revenue-generating companies.
Here it is: https://calacanis.com/2019/09/09/the-pegasus-startup-flying-over-vcs-on-the-wings-of-profits/
In my opinion, the insane growth of living expenses and wages makes it a lot harder to fund startups that need to figure out their own business model.
San Francisco is, after Hong Kong, the most expensive real estate market in the world. The average salary is more than 2x the average for American workers in the same industry and with the same experience.
Google is probably the most famous company being funded without having a business model. They had a team of 20 people and got a $25 million round. If you consider that the
average engineer's salary today is $130k per year, they would be burning $30 million per year just in salaries.
This level of costs makes it too risky for investors back companies and hope that they will figure out how to make money.
I thought he was not only in New York, but that was a big part of his identity.
I'm fairly positive that he's based in SF now, but he's definitely from New York
Yep been in SF for ages.