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Why Is Capital Efficiency So Important in B2B SaaS?

April 11, 2022
Written by Golden Section

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The team at Golden Section has a clear vision, mission, and values in how we approach partnering with B2B SaaS founders. Based on our approach we provide founders with capital and partner with them on their journey towards a meaningful exit.

We are focused on the founder, their journey, and how to make it as balanced, and successful, as possible. Efficiency and revenue above valuations and the single-minded (and oftentimes, detrimental) pursuit of unicorn status is key in helping founders succeed.

We also offer access to our expertise and strive to meet with our portfolio companies on a weekly basis in order to help guide them on their journey. The actions we take are by helping founders steer their company in the right direction, be efficient with their capital, and maintain the balance as a founder of a startup.

Partnership is a two-way street

If you’re a founder who is focused on the right fundamentals and looking to partner with an organization which will help propel your growth, Golden Section could be aligned with your company. Founders who are in tune with the perspectives we share below should consider partnering with us.

In founders we value focus, where avoiding mistakes leads to superior outcomes. We want to build it right the first-time versus the “build fast and break things” model where everything is temporary until the next round of capital is raised.

While there are numerous differentiators which separate us from other funds in the journey to help a founder see a meaningful exit, we’re not interested in the optics of success. Following much of the often-misguided advice out there in the ecosystem is not how we do things; we’re interested in doing things right from the beginning.

We are focused on the founder and their journey

The reality is that venture capital has lost its vision, mission and values; the fundamentals we believe are key in building a meaningful business. The process is broken, and there is a better way to engage investors which does not burn out most founders and enables them to maintain ownership of their company… and pursue a more reasonable exit than unicorn status.

Golden Section’s belief in creating a win-win for both sides enables early-stage founders to pursue and achieve their goals.

We focus on efficiency and revenue

We have a clear methodology on how we approach building world class companies, and work to dispel some of the common strategies we see in growing early-stage companies.

It all starts with capital efficiency, and the discipline that a founder has regarding raising money. Some of the traditional dogma in the venture scene is around scale, it’s just not beneficial for a founder to grind until they make it. When planning ahead we believe this should be a three-to-five-year journey with a clear destination.

We want to work with founders who are disciplined with capital, and do not want to have their equity significantly diluted. While others waste time looking for unicorns, we make our own magic.

We empower our portfolio companies

While capital efficiency is a key part of our value system, the breadth of services and support we make available to our portfolio companies is vital for a startup’s success. A key part of which is helping founders avoid mistakes, which can cost a lot of money, and lead to an otherwise viable company’s demise.

Empowering and working with our portfolio companies is a hedge against toxic “hustle culture” which glorifies sacrificing a founder’s life. We believe a founder should pursue balance for a better outcome. It’s common to believe that all that matters is the next round and being expedient, but permanence matters… and building it right the first time.

What makes us different

There are always conflicting voices around the growth of a startup, and “popular wisdom” when no one truly asks if this is even helpful. Investors may believe that founders need another round every 12 months, we believe that founders need revenue now, and to focus on building a profitable business.

When it comes to “common knowledge” that founders need to focus on growth, we believe they need to focus on efficiency. The media loves to glorify how meaningful a billion-dollar valuation is, but we believe a meaningful valuation is what’s right for the founder.

As a venture fund based in Houston that is investing in B2B SaaS companies we’re excited to journey with founders who share our view of success. Our approach is meaningfully different, and rare in the cutthroat world of venture investing. We seek to enable a way in which founders are able to build companies without the pressure of traditional VC in order to achieve fulfilling professional success and a meaningful exit. 

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