Presumably those were a while back?

Do you think the climate has changed since then to make it much harder?

The climate has changed in that it's easier for startups to raise more, but even those that do not can still be very successful. Justin.tv or Weebly would not require any more money to start today than they did six years ago -- if anything it's gotten cheaper.

I remember David from Weebly noting that they narrowly avoided the pinch by becoming profitable (circa 2009?) Now AFAIK they are kicking ass.

Yes, the Weebly story is amazing. He covered part of it at Startup School a few years ago: https://www.youtube.com/watch?v=l_b228qEVi8

I think one thing that is happening here is that certain types of startups are throwing money at problems that need to be solved in order to grow enough that raising additional funds is easy and/or not required.

An example would be that the founding team isn't skilled enough to get through the product market fit stage, so they hire in order to fill those gaps. Or maybe it's a chicken & egg problem, which often requires lots of time and luck to crack.

With the high salary requirements that engineers and designers have today, especially in Silicon Valley, this means burn-rates get very high very fast, even with only a few employees.

I remember five years ago in most cases you'd take a major salary cut (which was made up for in equity) when joining a startup as a first hire. You took a big risk to be employee number one or two. These days the landscape is so competitive you not only get equity, but a great salary as well.

I wonder if this has something to do with what you're hinting at?

As I get farther along in development I realize the cost and time to becoming profitable and break-even is smaller and smaller than I originally expected. It may slow down development if taking smaller investment, however from my experience so far being forced to move slower has its benefits - perhaps including less dilution.

Probably is easier to be frugal with limited resources. With a lot, is easier to overspend at first and later get burned. Limited resources from the star could help to focus more.

I have never get investment (rarely in my country) but always thinking that I prefer a small push than a huge one.

Weebly's traction and capital efficiency are remarkably impressive.

Maybe this is because smaller investments = early stage, and at something like YC you can get more hands-on to help the founder succeed?

Did they have progress when they raised again?

For some definition of progress, certainly, but neither company was an obvious winner in the first couple of years.

The key is to stay very lean until you have definite product/market fit and can raise a huge growth round.

Will investors let companies do this? Is it going to be OK if you only grow 100% per year because you are living within your means or aiming to become profitable as soon as possible?

If you have a SaaS business, growing 100% Y/Y is just fine until you hit $100m ARR.

-David

Maybe after you pass $10mm ARR. :)

Yes I think this is the rub. I don't think you can expect right now to get funding at the A round if you have only shown 100% Y/Y growth.