Founders

@fredwilson.eth how do you think about when a startup should target break even?

presumably not true forever

startups gain a lot of leverage from non-dilutive funding (the less you need money, the more you ~get it)

I think the best position a startup can be in is that break-even is achievable, but they've identified and built a situation where LTV>CAC and therefore it makes sense to grab a bucket of money and dump it into CAC

related:
https://paulgraham.com/aord.html
https://paulgraham.com/ramenprofitable.html

(haven't read these in awhile, maybe now's a good time to revisit)

i’m not fred

but i feel like the target isn’t break even

Also !fred, but my favorite metric is the saas magic number.  But this could be applied to most venture scale businesses. Slight modification to the LTV/CAC to test growth engine efficiency. 

This month’s change in ARR divided by last month’s sales and marketing spend.  As long as that’s >1, feed it with growth capital.  Then dial in the growth rate that’s possible while maintaining a magic number of greater than 1.

not fred but i guess it's just the type of route you want to take - depends on your funding size, market conditions & so much more.
Have seen companies that focussed on break even & some profits at the cost of lower scale become big
and there's the other side - more conventional hyper growth VC funded playbook.

Both work out

Feels like nowadays sooner and sooner 

Unless it's incredibly hard to commoditize, but that bracket gets smaller every passing month