If I were starting today — and in a sense, I’m running this experiment in many ways with SaaStr — I’d ask myself 3 questions if I had the option to raise seed funding (many don’t):

  • Can we make it 24+ months with the team we need to hire without funding?
  • Can we work even harder, and get to $2m+ ARR growing > 100% without funding?
  • Can we work even even harder, and get to $10m+ ARR without funding?

If we could answer Yes to all 3 questions, I wouldn’t raise outside capital. It’s so much better, in an ideal world, to skip several rounds of dilution.  Especially if you have the time.  The extra time it can take if you bootstrap.

This is what Atlassian and Qualtrics did. They waited until they truly hit escape velocity to raise any venture capital, and thus did it at nine-figure valuations, all for “secondary” sales (i.e., cashing out employees and others).

A few others like Zapier and Calendly did raise a seed round, but that was about it until unicorn status.

But in the end, most unicorns raise multiple rounds before then. The vast majority.

A bit more here:

The Average SaaS Unicorn Raises $370,000,000. And Bootstrapping is Rare.


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