[filip01]

It's bizarre that this type of essential advice is news to so many founders (including me). It's understandable from the VCs perspective though. Since they're mostly in it for huge exits it's rational for them to prefer companies with zero revenue, but good traction, over profitable (or close to profitable) companies with the same traction. Simply because the close to profitable company will have much more leverage than the zero-revenue one. In fact, a zero-revenue company who has been aiming at a VC Series A will often be forced to accept the term sheet at one or another VC whereas the profitable or close to profitable always can downsize, get a loan etc if they're not comfortable with the terms they can get at a VC. All this is because profitability isn't to the VC that much of a hint of long-term mega success as some growth metrics might be.

Related to this, it's a shame that the VC terms are often not well understood among first-time founders. If they were, I'm sure more people would try the revenue-route.

For a founder, it all boils down to how much this possible revenue will harm overall growth. In some cases (Instagram etc) it really does. In most other cases, it does not (or very little). But the zero-revenue route is easy to decide on since it's less work. "Yeah, let's take sales and all that later on" is easy to say especially when endorsed by the VC industry.