Single feature software apps are becoming increasingly easy to build and quickly turn into commodities, especially with the rise of AI tools. However, two types of software continue to thrive: "vertical software," tailored deeply to specific industries (such as Toast, Inc. for restaurants), and "compound software," which combines multiple related features around a shared data platform (like Rippling). Both of these software approaches result in stronger customer loyalty, better pricing power, and higher market valuations. Today, vertical software companies trade at about 53% higher multiples compared to general cloud software providers.
OpenAI secured a $40 billion funding round at a $300 billion valuation, marking the largest ever capital raise for a private company, yet it projects a $5 billion loss this year despite massive user and revenue growth. The San Francisco-based company has rapidly become a leader across multiple domains, combining cutting-edge AI innovation with significant consumer and B2B milestones. Despite the impressive numbers, OpenAI acknowledges that sustaining its ambitious AGI goals will require many more funding rounds.
Investors often pass on startups because the potential market seems too small. There are six concrete frameworks founders can use to demonstrate market size clearly: presenting a large overall market with room for expansion (like new geographies or product upgrades), calculating bottom-up customer demand, aligning your product with major industry shifts (e.g., AI or climate tech), drawing convincing analogies (like calling your startup "Stripe for X"), starting in a smaller market but showing clear growth paths, and describing a future where new consumer habits dramatically expand the market.
2025.04.30·
theventurecrew.substack.com·8 min read·TLDR Founders
AI is significantly enhancing established B2B leaders like Workday, which has boosted ARR to nearly $9 billion with 15% growth. Workday leverages AI across its product suite, resulting in higher customer retention, expanded ACV, and driving 30% of new customer expansions. The company maintains a strong financial position with a substantial subscription backlog and efficient operations.
Prompt Engineering Studio helps teams build, test, and deploy AI prompts at scale with a playground, version control, and AI gateway integration for 1,600+ models.
Most venture capitalists aim for billion-dollar unicorn startups, even though 90% of venture-backed companies fail to reach these massive valuations. This post presents an alternative investment model, citing real-world examples like Mailchimp's patient, bootstrapped journey to a $12 billion acquisition by Intuit Inc. and Freshworks' steady, profitable growth to $100 million ARR with less funding. Using data from Pitchbook and Cambridge Associates, it shows how profit-sharing deals and slower, sustainable growth produce healthier outcomes, higher founder satisfaction, and solid investor returns.
Google CEO Sundar Pichai claims AI Overviews are transforming search behavior, but new data from a 5-billion-query analysis tells a different story. While Google visits increased 9% after the May 2024 rollout in the US, users actually spent less time per visit and query length barely changed (just 0.6% longer). The data shows AI Overviews are creating a "quick answer" pattern rather than deeper engagement - users visit more frequently but leave faster.
Trade wars and supply-chain shocks might seem harmful for business, but these chaotic moments can actually help startups beat slower-moving incumbents. Tesla, Inc. quickly adapted during the global chip shortage by rewriting software to use different components while traditional carmakers like Ford Motor Company struggled. Drawing from Norse mythology—where Loki's disruptions ultimately lead to renewal—and historical shifts like Sony Corporation overtaking RCA by embracing portable radios, this post highlights how flexible companies that control their own product designs and supply chains ("vertical integrators") often seize ground when established giants falter.
Founders and executives need to notice when criticism causes a defensive reaction, pause, and instead become curious, asking questions to fully understand the investor's perspective.
Early Q1 earnings reports show software companies performing "better than feared" despite economic headwinds. ServiceNow slightly beat expectations and raised guidance despite lower net new ARR, positioning itself as a "deflationary AI platform" as boards seek cost-cutting and automation. Outside tech, a mixed picture emerges: big banks report healthy consumer spending, but signs of caution appear in consumer brands and housing as tariffs and high rates impact middle and lower-income segments. SaaS valuations remain modest at a 5.0x median revenue multiple, with growth rates continuing to be the main driver of premium valuations in an increasingly efficiency-focused market.
2025.04.28·
cloudedjudgement.substack.com·3 min read·TLDR Founders
There are two main paths in venture capital: the selective Home Run Hitters hunting for future $10B+ companies with smaller funds, and the Volume Players raising massive funds to deploy capital widely while living on management fees. Problems arise when VCs get caught in the "messy middle"—not elite enough for top deals but trying to act like they are. Tiger openly moves fast without much involvement, while firms like Benchmark take concentrated positions with hands-on support. Neither approach is wrong—the danger comes when funds aren't honest about their strategy, pushing founders to raise too much or setting unrealistic expectations.
The linear “seed-A-B” assembly line is over. Startups now jump between discrete capital pools, and valuations ride almost entirely on conviction—whoever “believes harder” wins the round. Meanwhile, AI is up-ending the funding game (inbound deal flow is dead and classic SaaS looks uninvestable) and capital markets are splintering into region- and stage-specific silos, forcing LPs and GPs to play several fragmented games at once. Net-net: narrative beats numbers, AI warps the field, and the one-size-fits-all VC market is gone.
Building a robust dashboard is crucial for retaining and upgrading existing SaaS customers, as it clearly communicates value to all stakeholders, even those who never use the app. A successful dashboard requires no additional work from users, provides daily value to key stakeholders, and clearly displays ROI, which can accelerate deal closures and ease renewals. By making the dashboard a core asset, apps can differentiate themselves from competitors and justify higher pricing.
Every organization has at least one under-performer who can negatively impact overall productivity and performance expectations. To address this, consider reassigning roles, offering training, or letting them go to maintain high performance standards. Quick action can prevent contagious underperformance and preserve team morale.
Freshworks, initially a Zendesk competitor, has grown to $800M ARR, primarily driven by its EX products and enterprise focus. Despite a slight downturn, it's showing modest growth with a reaccelerating customer base and significant contributions from $50K+ clients. The company's strategic shift to a multi-product approach and AI integration led to increased cash flow and expanded global presence.
A new survey revealed that over half of tech workers waste 25-50% of their time on "work about work" like meetings and approvals. Contrary to expectations, in-office teams report more coordination waste than hybrid workers. Solutions include better delegation, embracing async work, and using AI to summarize meetings and analyze workflow bottlenecks
2025.04.28·
newsletter.eng-leadership.com·3 min read·TLDR Founders
Tech stories once belonged to gatekeepers like TechCrunch. Now a revolution is brewing—a modern "Republic of Letters" where founders, investors, and builders tell their own tales. This movement exploded during COVID when Packy McCormick, Lenny Rachitsky, and others built massive audiences seemingly overnight. This was because people craved optimism and insider truths instead of journalist skepticism. The secret isn't fancy credentials or connections—just pick one simple idea, take it seriously, and start creating. Even with just a few readers at first, your ideas will sharpen, your network will grow, and you might just find your tribe along the way.
Swedish AI startup Lovable skyrocketed to $30M ARR in 120 days with a team of just 18, leveraging viral growth from rebranding and improvements on a robust initial product. Its growth strategy involved targeted social media engagement and launching on platforms like Product Hunt, capitalizing on word-of-mouth. Lovable's hybrid pricing strategy combines subscriptions with usage limits, maintaining profitability while investing in product development.
Remember when SOC 2 was hard? Delve's AI agents [4] are putting an end to that. They work around the clock, scanning your systems and gathering evidence while you do the whole ‘building your company' thing.
A speculative look at how AI might evolve over the next few years, from clumsy "order a burrito" assistants to superhuman research AIs transforming industries and reshaping geopolitics, kicking off a Cold War-style competition for compute and talent.
Andrew Chen from Andreessen Horowitz highlighted the rapid acceleration of technology adoption and its impact on consumer startups using historical examples like the Michelin Guide and modern analogs such as viral marketing and content strategies. He noted emerging opportunities in areas like video technology, offline-to-online channels, and innovations in autonomous vehicles and augmented reality.
This article pushes back on the hype—and fear—around AI, suggesting it's more like electricity or the internet than a runaway superintelligence. Instead of imagining sci-fi scenarios, it argues we'll see gradual but powerful impacts, giving us plenty of time (and tools) to adapt. Rather than worrying about runaway AI scenarios, the authors propose focusing on realistic risks like accidents, misuse, and systemic harms, addressing these through existing regulatory frameworks and downstream safeguards.
When Uber was losing money, scenario modeling identified a path to profitability—even when experts were skeptical. This guide walks through how scenario modeling works, showing exactly what's needed to achieve targets like "$1B in revenue" or "profitable growth." It includes step-by-step instructions and a real-world example: improving margins in a food delivery business.
Many startups waste marketing dollars because they don't properly track campaign impact. The fix: track your spending not just at the channel level (like Google Ads or Meta), but at the campaign level. Real attribution means knowing exactly which marketing dollars drive revenue and scaling accordingly. Skip overly simplistic models (like first or last touch), and avoid siloed data.
Investing in emerging sectors like biotech, AI, fintech, healthcare, and climate tech offers growth opportunities but comes with inherent risks. These sectors are at the forefront of technological advancements and may benefit from government incentives and corporate investments.
Teams often nail communication in small groups but struggle when expanding. Great conversations at scale require balancing autonomy (local) and coordination (global). Prioritize minimal formal structure—just enough to guide interactions, not so much that it slows everyone down. Watch out if your team sounds rushed, disconnected, or overly scripted, it likely means you've drifted too far in one direction. Healthy teams design interactions thoughtfully, creating clarity without stifling agility.
Most warm intros fail because the sender sounds insincere or generic. Persuasive intros come down to sincerity and anticipating questions the reader cares about: Why me? Why now? What's the benefit for me specifically? Avoid entitlement and boilerplate messages. Instead, personalize just enough to make the recipient feel genuinely valued. Good intros balance sincerity, subtlety, and empathy—never assume your referrer's credibility alone can seal the deal.
Setting up a simple Slack bot to send real-time alerts about key product events like new signups, cancellations, and feature usage can help you respond to customers immediately, catch early warning signs, and maintain a pulse on your business without waiting for weekly analytics reports.
Private investors sit on mountains of paper wealth with few exits as PE acquisitions hit lows while capital calls outpace distributions. The gap between calls and distributions approaches ZIRP-era levels, creating negative cash flow for LPs. Despite liquidity issues, panic remains absent—just a gap between valuations and returns. The message stands clear: the "grow at all costs" playbook fails in a world where capital costs more, investors need returns, and buyers demand profit before paying prices that deliver investor returns.
AI companies can now rocket to $100M revenue in months instead of years, but with this speed comes instability – many lose product-market fit just as quickly as they find it. Once, hitting PMF meant five years of stability. Now, companies cycle through PMF three times in two years as competition intensifies. This creates a "false peak" problem where founders mistake temporary growth for lasting success.