Truffle Pigs

Hey y’all — we’re one day behind this week after some bugs with our newsletter platform but here’s today at a glance:

🔗 Houck’s Picks

My favorite finds of the week.

Fundraising

• Ryan Hoover on why he wouldn’t raise without a secret or traction (Link)

• Peter Walker shares VC funding data by stage from the last 12 months (Link)

• Nijunj Kothari on why taking time to find the right VC is worth it (Link)

• Alejandro Cremadas on how investors value pre-revenue startups (Link)

Growth

• Pete Kazanjy on the winning sales deck structure (Link)

• Natia Kurdadze on SEO cheat codes every founder should know (Link)

ICYMI

• Join Peec AI today to learn exactly how to stay visible in an AI-first world (Link)*

• Tibo Louis-Lucas on how he finds product opportunities (Link)

• Chris Tottman on market size versus market urgency (Link)

• Daniela Navaes on how might not know who you competitors actually are (Link)

💡 Opportunity: AI Funnel Builder For Solopreneurs

I started Founding Journey as a “solopreneur” and, even though there’s a team behind our holdco now, I still remember what that was like.

It had pros, for sure, but the cons outweighed them for me. Once the business started generating meaningful revenue ($10k/mo+ I brought on my first hire — if done well, headcount unlocks not only more revenue but also profit).

One of those cons was that the tools targeted to solopreneurs were surprisingly expensive.

For every good and cheap tool like Post Bridge ($9/mo), there was another like Kajabi (useful but $149/mo for the “Basic” tier). And, when you’re solo and trying to reach $10k MRR, every dollar feels big.

One of the best ways to make this not matter, of course, is to grow revenue by acquiring customers but funnel building tools are among the worst offenders here.

I would have, and I imagine many solopreneurs now would, switch over to a true AI-first funnel builder that’s reasonably priced without a second thought (especially if it was able to eventually serve customers who were more upmarket as well, since then they’d have faith it would grow with them).

🧠 Framework: “Ideation” Framework

I’ve never loved the term “ideation” since founders don’t really come up with ideas — we learn about problems and the natural result is a way to solve it.

We’re truffle pigs, sniffing out where the truffles are buried just underground enough that we can get to them.

But if you’re looking for truffles, it helps to know the parts of the forrest they tend to accumulate in (and which types are better than others).

John Rush’s framework, below, lays out one idea of what this looks like for founders and the problems we hunt:

📈 Trend: Down Rounds Are Declining

More good news about the venture markets.

The end of the ZIRP era saw a predictable large spike in down rounds. Startups that had raised at inflated valuations but suddenly found themselves raising again in a much less forgiving market often have to accept worse terms.

When investors feel confident they’ll be able to raise additional funds easily, they are less sensitive to valuation and more risk-tolerant in general. When that changes, so does their calculus and founders sometimes end up in tough situations.

But we’re now almost 3 years into the AI boom and the ZIRP era startups have either survived or died while the new AI startups are still seeing aggressive interest from investors.

As a result, the percentage of rounds that are down rounds is returning to more normal levels across all stages:

You’ll notice from the chart that these swings are felt most abruptly in the later rounds, which is interesting but not counter-intuitive for two reasons:

1. There are fewer deals at these stages, so even small fluctuations can have a larger impact

2. Growth stage investors are more sensitive to large-scale macro sentiment in public markets and from institutional capital like pension funds and sovereign wealth funds

It’s no surprise that Q4 and Q1 (the last quarters we have this data for) show such an improvement at the growth stages, as the policies Trump was talking about when entering office encouraged significant optimism about the markets.

💬 Quote: Embrace Uncertainty

If you’re reading this newsletter, you’re probably not like most of your non-founder friends in one key way:

You’re ok with uncertainty.

In finance, uncertainty = risk.

For founders, uncertainty = risk but you can’t really care about that too much.

There is a point where courting and introducing uncertainty pushes the business into an unstable place, of course. But even that can be mitigated by your skills as a founder.

Look at the generational founders of this era.

When Elon used his basically all of his personal capital (millions, at the time) to keep Tesla and SpaceX alive, he was entering a level of risk that would make most people go bald in a week.

I’m not advocating for that — not everyone has Elon-level mastery (sorry) but it’s an extreme example of something we all need to understand about ourselves and our startups.

Ask yourself this question when you’re considering something risky:

How much uncertainty am I willing and able to embrace to move the business forward?

Sanity check yourself on this often. Your feelings on your own level along with your interpretation of where the business is at will be constantly in flux.

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