[s1artibartfast]

Where I saw it was in the Healthcare field where several million of funding was required for series A and most of the founders were senior MDs and engineers having worked years on early development . When faced with choice between being highly unattractive for investment or being able to develop, they made the hard choice to put product over profit.

My point was mostly to shed light on the fact that most VCs want few founders and diffuse ownership can cause investment challenges.

[Silhouette]

OK, the economics will inevitably be different if you're not doing pure software work and also have some physical element or high regulatory barriers to entry. Maybe in those cases taking investment is the most likely way for most new businesses to become established.

But for pure software businesses my answer to your final paragraph would be "OK, so maybe you just bootstrap the business with a few good people and skip the VC part". If you aren't hiring hundreds of staff or buying up expensive cloud resources like they're about to run out regardless of how inefficient your product is, how many software startups could get by just fine with a real business model that actually makes money and some steady growth? Who says you have to have a pitch deck, a huge cash injection based on hope and high variance VC investment models, and one hand tied behind your back with investors holding the strings until the Big Exit(TM) or, more likely, the funding runs out before you have actually built a sustainable business and everything just gets shut down?