The Cost of Building for VCs

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When Chezie launched in October 2021, we built our initial product in no-code (Bubble), quickly signed our first three customers, Chegg, Huge, and Ripple, and got to about $60K in ARR. Things were looking good – we felt confident we could land another ten customers with the same no-code product.

Then, we listened to "expert" advice and "venture capital best practices." We needed a full-stack product, they said. We needed technical co-founders. It made sense on paper – we were selling to enterprises.

Two years and (literally) hundreds of thousands of dollars later, we had gone through three different technical teams trying to build a product that ultimately didn't work. We ended up right back where we started: on the no-code platform that was working all along.

Why did we do this? Simple: we wanted to look good for VCs.

How VCs Change Founder Behavior

It's scary to think about how much VC thinking influences how founders build companies. Let me break down three clear examples from my experience:

Hiring

VCs always push founders to "hire the best people." Sounds great, right? But in practice, "the best" often means the most expensive talent from prestigious backgrounds, and it excludes talent that doesn’t fit that mold.

There’s also the pressure of team bloat. I wrote about this last week, but early-stage founders are best off staying as flexible as possible. VC has pressured founders to build large teams quickly, usually before they need to. And since these "best" people come with hefty salaries, founders raise money to afford their hires. This leads to a vicious cycle: raise money to hire expensive people, then need to raise more money to keep them.

Product Development

The VC mindset fundamentally changes how founders approach product development. Instead of building what customers need, you start building for some hypothetical future state. You add features that might appeal to enterprise customers down the line. Most dangerously, you focus on creating a "powerful" product loaded with features instead of solving one specific problem well. We fell into this trap ourselves, spending two years trying to build a complex full-stack solution when our simple no-code product was already working.

Price setting is another huge area where VC influence shows up. VC-backed companies typically price their products 2-3x higher than bootstrapped alternatives – not because that's what the market demands, but because they need to show high ACVs (average contract values) to raise their next round. This pushes you away from what customers are willing to pay and toward what looks good in a pitch deck.

Growth

The growth-at-all-costs mindset has become almost gospel in VC-backed companies. While this approach works for some businesses, it's wrong for most. When focused on VC-style growth, you start throwing money at paid acquisition instead of finding sustainable, organic growth channels. You chase growth metrics that look good in investor updates instead of focusing on what builds a healthy business. The worst part? This usually leads founders to raise money to fund marketing efforts, creating dependency on future fundraising before the business model is proven or the company is profitable.

The Mental Toll of Building for VCs

The financial costs are obvious – we burned through hundreds of thousands trying to build something we thought VCs wanted to see. But there's also a mental toll that isn’t often discussed.

When building for VCs, you're constantly looking over your shoulder. Every decision comes with the added stress of "How will investors perceive this?" I used to worry that VCs would think I was getting distracted when I started writing this newsletter. I hesitated to share our challenges publicly because they might make us look weak in our next fundraising event. That kind of second-guessing is exhausting.

This mindset creates a strange kind of impostor syndrome. You start performing as a startup founder instead of just being a founder. You always feel pressure to have the right answers, to crush it – even when things are hard. You decide based on what you think a "good founder" would do rather than what's right for your business.

Build for You Instead

Here's a simple framework I use now. Before any major decision, ask yourself:

1. Does this serve our current customers?

2. Would we do this if we weren't raising money?

3. Can we afford this without outside funding?

4. Does this align with our original mission?

Building for yourself means making decisions based on what you have today, not what you think you'll have after your next round. It's about looking at your current resources – your team, your cash, your capabilities – and building within those constraints. When we stopped trying to build for VCs, we got much better at saying "not yet" to features or hires we couldn't support.

It also means being brutally honest about growth expectations. Not every company needs to (or can) grow 3x year over year. Some businesses naturally grow slower, and that's fine. When you're building for yourself instead of VCs, you can focus on sustainable growth that doesn't require constant fundraising.

Most importantly, building for yourself means caring only about two groups of people: your team and your customers. Not investors, not Twitter, not the tech blogs. We used to make decisions thinking about how they'd look in our next pitch deck. Now we just ask: Will this help our customers? Can our team execute this well? Everything else is noise.

Today, Chezie runs on a mix of no-code and traditional code. Our technology is stable, our customers are happy, and most importantly, we're building what makes sense for us – not what we think will impress VCs.

See you next week,

Toby