Navigating Uncertain Times: Advice from Rajeev Dham of Sapphire Ventures

Startups of all sizes are feeling the pressures of an uncertain economy right now—no matter if you’re pre-seed or a public company.

“I'm involved with companies that are between 5 million in revenue to hundreds of millions in revenue,” says Rajeev Dham, a Partner at Sapphire Ventures.

“Even those at the later stages are having an incredibly hard time forecasting, predicting their top line, [and understanding] customer demand. And these are great companies with great value propositions.”

Conserving runway has become a priority to combat economic worries. What’s more, if companies can raise more funding in the next year, their valuation likely won’t be the same as it was even just a year ago, which can lead to other ramifications.

So, what should your next move be to stay afloat?

Rajeev Dham shares his advice for companies unsure where to go from here.

Be cautious about investing in growth initiatives (for now)

Dham says to get candid about what makes sense to invest in growth-wise in the next year.

“My reasoning to management teams and CEOs is, ‘Hey, if you can't predict how much revenue and cash we'll bring in, let's just be super careful in investing behind that growth.’”

It’s challenging to predict the ROI of investments right now, but if it’s possible to gauge a return on certain initiatives, do so with caution.

💡 Note: Subscript helps you get clear on your efficiency metrics, so you know where best to invest your time and funds.

“Wait until the dollars are more valuable”

Standing still (or even moving at a snail’s pace) can feel like a death sentence to a startup—especially compared to previous years.

But Dham encourages businesses to wait it out if possible.

“We don't know how much yield we'll get for every dollar of investment,” says Dham. “That's kind of a basic sort of mantra we’re telling our management team. Wait until the dollars are more valuable.”

It’s tempting to raise more funds due to the uncertainty, but raising in this climate has its own implications.

“It's not just about preserving the runway because multiples have come down and you don't want to raise a down round. It's more about, ‘Why don't we wait until we know what we can get out of every single dollar we invest? We know we can get more out of it, and right now, we have no idea.’”

Make it through with Subscript

While these are turbulent times, there’s still a silver lining. Subscript takes the headache out of B2B SaaS data analysis, giving you more time and cleaner numbers to help you build a strong financial strategy. We can help.