onlycfo.io · 2023-07-14 · 1056d

Praying for Growth & Exits: How to Achieve the Best Possible Financial Outcome

Growth-stage software companies face a critical strategic choice between aggressive growth targets, cash preservation, or balanced approaches given constrained runways and difficult fundraising markets. The article argues that 'default investable' and 'default alive' are the two primary outcome targets, with strategic and PE acquisitions as alternatives, and emphasizes that efficient revenue growth rather than unfunded hockey-stick projections determines optimal financial outcomes.

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Metrics in this report

MosaicML Acquisition Revenue

20.0million dollars

At time of Databricks acquisition for $1.3B

PE Tech Acquisition Revenue Multiple

4.9x revenue

median

Tech company PE acquisitions

Strategic Acquisition Revenue Multiple

65.0x revenue

AI-space strategic acquisition (MosaicML/Databricks example)