In any given week I’ll receive 1-2 emails from venture capitalists asking for an intro to an Atlanta Ventures startup. Naturally, I ask what stage startup they target, especially if it isn’t explicitly stated on their website (this assumes it isn’t the proverbial associate call). Most of the time, the investor is looking for the startup to be at a later stage, and so the intro isn’t a good fit (most venture firms have moved up market and look for businesses that are further along).
Here are some common startup stages by revenue (investors will also expect to see growth rates above 30% as well):
- Idea Stage – No revenue or product, but lots of energy and enthusiasm.
- Seed Stage – Under $1 million in revenue (often under $100,000), working product, and paying customers with some early metrics (seeking product/market fit).
- Early Stage – Between $1 million and $5 million in revenue with solid metrics and a repeatable customer acquisition process.
- Growth Stage – $5 million or more in revenue, strong team, and working on scaling all aspects of the business.
The next time an investor reaches out, one of the easiest qualifying questions is to ask what stage company they look for, and to have them give a revenue range as part of the answer.
What else? What are some more thoughts on startup stages by revenue?