Thread by @sajithpai

*Scalable GTM enabling predictable unit-positive customer acquisition indicating a large / expandable TAM.*

This is what Series A funds traditionally look for.

As the funding environment softens, seed founders would do well to keep the above in mind. Let us unpack this.

It is never been easier to raise a pre-seed / seed as in the last two years. It is also never ever been harder to raise a Series A. As Seed has gotten easier, Series A is now the chokepoint.

Elite Series A funds have been doing preseed / seed rounds; so they are blessed with choice when it comes to Series A - in addition to those invested by other funds, they also have their own to take care of. Hence only the best performing seed stage startups will get a look in.

Seed founders - make sure you get to PMF, or are closing in on it - when you start Series A fundraising. 'Historically' Series A is linked to PMF / product-market fit.

PMF is when you have predictable, repeatable, unit-positive growth.

An article on this
linkedin.com/pulse/defining…

PMF is the destination, & getting to PMF is to work towards a *scalable GTM, enabling predictable & unit positive customer acquisition* & Given funding, ideally one hinting at a large market opportunity / TAM.

Scalable GTM = you have a clear playbook to identify, reach & engage customers. The playbook can be rinse-repeated across diff micromarkets, or can be expanded by adding more people. Linear relationship between investment & customer outreach.

Predictable customer acquisition = broad formulas hold for number of customers engaged and how many convert. Also for the time taken for them to onboard. There is a predictability / repeatability around the customer acquisition playbook.

Unit-positive = The accounts / customers / orders are CM2 positive covering variable costs, i.e, the revenue covers the cost of goods sold/servicing and customer acquisition. If revenue expands, it will cover fixed costs at some large enough point.

Large TAM = The problem / market opportunity you are after is large, or expandable. If the market doesn't seem large, indicate future hooks (marketplace, financing, global markets) that can be layered on. Present this as the 1st phase of a land + expand / tip of spear strategy.

So there you go, seed stage founders, from the time you raise funding, work towards a
Scalable GTM
enabling Predictable Customer Acquisition
which is Unit-Positive
hinting at a Large or Expandable TAM.

PMF = first three elements essentially. The nailing before you begin scaling.

If I need to summarize the above in as pithy a manner as possible, I would say *Build a Scalable GTM (go to market) Engine* A customer reachout, engagement & acquisition machine that can be dialed up or down basis funds. Build this, hint at a large TAM, & the inbounds will begin.

Founders - we are beginning to see a gentle softening all around. Conversations that take would take 2 weeks are taking 3 weeks, DDs are getting a little more rigorous. It is the stage of the party where the music is playing, but the lights are on:)

As the funding froth settles a bit, it is time to get back to fundamentals.

Seed founders: Build a scalable GTM engine!

👋