[phphphphp]

Venture investments don't typically work that way: the goal isn't incremental returns YoY but rather major returns in the long term. Raise a fund, make a bunch of investments, report growth in valuation YoY (based on increasing valuations of portfolio) and then deliver returns once portfolio companies start to exit.

If BitWarden can use that $100m to 10x their valuation and then exit (whether that's an acquisition, going public etc.) the investors will have secured a win: if BitWarden's valuation stays where it is and returns ~$10m/year to the investor(s) over the next decade, that's not a great outcome considering the opportunity cost of capital.

Debt equity is the type of financing you're describing: lower risk, lower returns, not particularly exciting and not particularly attractive to investors if they believe the company has substantial upside potential.

[pbhjpbhj]

Yes, I'm not familiar with expected returns for investments so my back-of-napkin maths was based on approximate housing inflation in the UK. I figured they'd want more than that as a minimum.

Clearly Bitwarden isn't a unicorn, being a smaller entity in a growing market; do VCs really expect a 10x (in couple of years?) from that sort of investment?

So, do you agree with my basic premise that they'll need a whole heap of customers, that they don't seem likely to get, in order to make any dent in the investors hoped for returns?

[phphphphp]

I’d suggest with almost absolute confidence that they are betting on unicorn status for BitWarden. I’d be surprised if they expect anything less than a >$2.5bn exit.