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【A Must-Read for Startups】The Product Line You Fund the Most May Not Be the Most Important
- 11 minutes ago
- 3 min read
Judge with the right numbers to decide which goals to keep, then concentrate the best resources on them
At VENTURE+ we meet each portfolio company once a month, and between those meetings we are out on business visits. Across a year, a fair number of companies turn out to be stuck in the same place.
Goals appear one at a time. This quarter a major account has to be won, a new feature has to ship, a new market is worth testing, and a custom-build line is already running. Every one of them deserves to be done, and every one has someone pushing it.
Without convergence, resources are allocated with no order of priority, and investment never concentrates. At next month’s meeting everything has moved a little and nothing has finished.
1. Narrowing the Goals: Revenue Alone Does Not Show the Whole Picture
Resources are limited. Only when goals are narrowed to a handful, with the rest set aside for now, does progress become efficient.
The most readily available yardstick is revenue. The line with the largest revenue is the important one, and results are reported in revenue as well. Most companies judged this way when they had a single product line, and never changed afterwards.
Revenue, however, describes how large a line is, not how much it keeps.
Project and custom work carries large individual deals, visible delivery and a story that sounds concrete in a meeting; subscription revenue arrives in smaller pieces and accumulates slowly, barely registering in any single month. The former feels like the main event, the latter like a supporting act. Once costs are assigned back to the lines they belong to, the money actually left over often runs the other way.
So both yardsticks are needed. Revenue for scale, gross profit for what is genuinely retained. The gross profit meant here is the gross profit of each line on its own, not the consolidated figure on the income statement. Many startups never break it out, but a single pass is enough to show which lines deserve to stay.
2. Concentrating the Best Resources on the Goals That Remain
The goals that survive should be pushed with the best and the largest share of resources.
Budget, headcount, the development schedule, marketing spend, the accounts the sales team calls on, and the number of occasions a founder is willing to show up in person are all resources, and all of them are limited. Most companies are reasonably disciplined when dividing the budget, and let the rest run on habit. The development schedule keeps its original order, sales keeps calling on the accounts it already knows, and the founder keeps appearing where the founder always appeared. The money moves, nothing else follows, and the priority goals still fail to move.
A line with low gross profit does not automatically have to go. It may be the ticket into a particular customer or market, or it may be absorbing fixed costs that exist anyway. Those reasons hold up, provided the company can say what the line is buying and when that is due. When it cannot, and the line simply stays, what is left is habit.
Judgments also expire. Two lines can share a low gross profit while one is standardizing its delivery and improving quarter by quarter and the other has stood still for years. The first may be exactly the line to fund harder this quarter.
Conclusion
Once the goals are narrowed and the resources have genuinely moved, the goals that appeared one at a time finally have an order. Where each goal sits this quarter, and which one has to prove itself by when, all follow from here.
The pace of the company changes gear here as well. There are no more people and no more budget, but effort is no longer spread thin, and what the company can actually move is different.
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About VENTURE+
VENTURE+ specializes in SaaS and AI investments, offering more than just funding. We provide startups with strategic guidance, corporate partnerships, and capital market planning. We aim to be the "Best Co-Founding Partner" bridging startups, venture capital, and industry leaders in long-term collaboration.
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