Why Top Investors Passed on Big Deals

Regulatory hurdles can be turned into strategic advantages for startups willing to tackle them head-on.

"That regulatory fight would have been fascinating to work on. It would have been so fun and we would have made money on that one."

• Tusk reflected on missed opportunities due to underestimating regulatory aspects.
• Engaging with regulatory challenges can differentiate a startup in the market.
• Founders should consider how overcoming regulations can create barriers to entry for competitors.

VCs often pass on startups due to regulatory hurdles, but these can present unique investment opportunities.

"I remember Beyond Meat being one of them, and it was dumb for me to do for a few reasons... That regulatory fight would have been fascinating to work on. It would have been so fun and we would have made money on that one."

• Tusk realized that regulatory challenges can be advantageous for investors with expertise.
• Overlooking regulatory opportunities may lead to missing out on successful investments.
• VCs should evaluate how their skills can turn regulatory hurdles into competitive advantages.

Expanding into adjacent markets can boost revenue without detracting from core objectives if approached strategically.

"We looked at our roadmap... about 80% of our roadmap overlapped with what CAS firms were going to need and with what our enterprise accounts were going to need. And so we just kept building our products."

• Whitmire identified overlapping needs between core and adjacent markets.
• By continuing to build their product, they satisfied new market needs without major resource shifts.
• Founders can leverage product synergies to tap into additional revenue streams.

Founders often face tough decisions when new market opportunities arise, and balancing focus with adaptability is crucial.

"My team was really pushing for, let's start selling into CAS. And I had to very firmly take a stance of, no, we can't do that because we have big ambitions here."

• Whitmire chose to focus on long-term ambitions over immediate revenue by not pivoting to CAS firms.
• He considered the limited TAM of $100 million insufficient for his goal of building a public company.
• Founders should align new opportunities with their long-term vision and market potential.