[lmeyerov]

The interesting difference, and current problem, is VCs expect raised funds to be spent as burn on hiring more people despite existing people already being paid from VC capital instead of revenue. And they expect that to keep happening: each next round will be bigger and cover even bigger payrolls. If the next round doesn't happen, layoffs, and if flat (ex: bc markups are down 3x), dilution & quitting by the best - either way, downward spiral that is hard to return from. The gamble is nothing breaks while this happens -- doubling down the bet.

With interest loans based on revenue, it's fine to stop whenever bc you have revenue for (most of) payroll.

Operationally, that expectation is now worse than interest. In the good times, it was free money for free growth, but with fewer and marked down rounds, a killer. Some founders value efficiency, which avoids this issue, but in the last few years, VC boards certainly were encouraging inefficient growth, meaning bad times for such VC-dependent companies.