During the MovieLaLa days, we learned something about stop doing revenue-based financing like it's 2024 that I still apply to every investment I make.
I failed 14 times before I figured this out. Here's the exact framework I use for revenue-based financing now. Don't make my mistakes.
Why Most Approaches Fail
Let me be direct: about 70% of the approaches I see to stop doing revenue-based financing like it's 2024 are fundamentally flawed. Not slightly off. Fundamentally flawed.
The root cause is usually one of three things:
- Copying what big companies do without understanding why they do it. What works for Google doesn't work for a 10-person startup.
- Over-engineering the solution when a simple approach would work better. I've seen teams spend six months building something that could have been done in two weeks.
- Ignoring the human element. Technology is the easy part. Getting people to actually use it is where the real challenge lives.
The Counterintuitive Truth
Here's what surprised me most about stop doing revenue-based financing like it's 2024: the best practitioners do less, not more.
When I was building MovieLaLa, we tried to do everything at once. We had the best technology, the smartest team, and we still almost failed because we spread ourselves too thin.
The lesson I took from that experience, and from watching hundreds of other companies, is that the market doesn't care about your roadmap. It sounds simple. It's incredibly hard to execute.
What I Tell Founders
When a founder in my portfolio asks me about stop doing revenue-based financing like it's 2024, I usually start with three questions:
- What's your timeline? Because the right approach for a company with 6 months of runway is very different from one with 3 years.
- What have you already tried? Most founders have tried something. Understanding what didn't work is often more valuable than knowing what might.
- Who on your team owns this? If the answer is "everyone" or "no one," that's your first problem to solve.
These questions seem simple but they reveal a lot about where a company actually stands.
This connects to broader themes around revenue-based financing, investor relations, SAFE agreements, fundraising timeline, convertible notes that I've been thinking about a lot lately.
Wrapping Up
I've shared a lot here, and I know it can feel overwhelming. But here's the thing about stop doing revenue-based financing like it's 2024: you don't need to get everything right on day one. You just need to get started and keep improving.
The founders in my portfolio who excel at stop doing revenue-based financing like it's 2024 share one trait: they're relentlessly practical. They don't chase perfection. They chase progress.
That's the mindset I'd encourage you to adopt. Start where you are. Use what you have. Do what you can. And keep pushing forward.
As always, I'm rooting for you.
Frequently Asked Questions
What experience informs this perspective?
This perspective comes from over a decade of building companies in Silicon Valley, two successful exits (RemoteTeam to Gusto, MovieLaLa to Gfycat), and investing in 200+ startups including Anthropic, OpenAI, and Scale AI. I write about what I've lived.
How can I apply this thinking to my own situation?
Start by identifying the core principle behind the opinion, not the specific example. Then ask yourself: does this principle apply to my context? If yes, test it in a small, low-risk way before going all in.
What's the most common pushback you get on this?
People often push back by citing exceptions or edge cases. And they're usually right that exceptions exist. But building a strategy around exceptions rather than patterns is a losing game for most founders.
Do all experts agree with this view?
No, and that's fine. The best ideas in business are often contrarian. I share my perspective based on my experience and data, but I encourage you to seek out opposing viewpoints and form your own conclusions.