[trevelyan]

> you probably aren't the kind of business they're looking for.

Sure, but isn't this the problem?

Assume you have a revenue-generating business making 250k in year two. In my opinion, this startup should be valued at considerably more than 10x revenue. But that sort of valuation is hard to get, and likely impossible if the founder has to jump through hoops simply to get introductions.

What will these companies do? They'll focus on growth and avoid raising capital. Because once you break about a million capital becomes really easy to raise, and you can get money on far better terms than any VCs will offer. So there's an adverse selection problem here that effectively concentrates investment in high-risk businesses, since as soon as companies become self-sustainable pursuing funding for growth is usually less preferable to chasing down outside money.