VCs will say no if you don't have traction, leading to product-market fit for hyper-growth. Many founders need help understanding why.

As a fellow founder and investor who’s been through the ups and downs, I can tell you that VCs need to aim for 10-50x returns because they’re playing a high-stakes game where most bets don’t pan out. The reality is that most startups won’t succeed, and the few that do need to generate enough return to cover all those losses and still deliver big wins to their investors.

Remember, VCs have investors called "limited partners." It's not their money. Their limited partners—pension funds, universities, and high-net-worth individuals—are counting on those returns, which means VCs are looking for founders who can scale fast and turn an idea into something huge.

It’s not just about making money; it’s about making enough money to compensate for all the ones that didn’t work out, and that's why they need companies with massive potential.

If you're not a hyper-growth startup and need to raise capital, there are many other options, starting with FFA (Friends, Family, and Associates).

Check out our "How Funding Works" course here to learn more: https://www.startups.com/courses/how-funding-works