Dear Startups:  Here’s How to Stay Alive
<i>You know what kind of companies generally survive?  Companies that make more money than they spend.  I know, duh, right?  If you make more than you spend, you get to stay alive for a long time.  If you don’t, you have to get money from someone else to keep going.  And, as I just said, that’s going to be way harder now.  I’m embarrassed writing this because it is so flipping simple, yet it is amazing to me how many entrepreneurs are still talking about their plans to the next round.  What if there is no next round?  Don’t you still want to survive?<p>Yes, some companies are ‘moon shots’ (DFJ has a fair number of those in our portfolio) where this is simply not possible.  But for the vast majority of startups, this should be possible.</i><p>What is the point of calling them start ups anymore. Remove the high risk&#x2F;high reward aspect and new companies are simply small businesses that receive small business loans from banks. A lot of the &quot;wow&quot; factor of the startup ecosystem was the mind boggling user growth&#x2F;high valuation&#x2F;massive losses phenomenon that a few companies weathered through to IPO and monetization.<p>I think I saw someone advocating for better terminology on HN recently. I vote to call any close-to-profitable &lt;2 yr old company a small business. Likewise, any portfolio that holds mostly safe small business loans and equity should simply be called a bank.<p>Leave the unicorn&#x2F;VC&#x2F;startup lingo in the past, or use it to describe actual risk profiles, and things will be a lot less confusing.