⏮️February's Highlights Across Startups, VC, Data & AI
Content, Research, Reports, Podcasts, Events, Jobs & More
👋 Hi, I’m Andre and welcome to my newsletter Data-Driven VC which is all about becoming a better investor with Data & AI. Join 32,140 thought leaders from VCs like a16z, Accel, Index, Sequoia, and more to understand how startup investing becomes more data-driven, why it matters, and what it means for you.
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Welcome to our monthly wrap-up episode where we cover February’s most relevant content at the intersection of startups, VC, data & AI.
We read it all so you don’t need to - here we go👇
INTERESTING RESEARCH & REPORTS📈
How Big Should Your Seed-Stage Employee Option Pool Be?
New data from Carta shows that the median employee option pool at the seed stage is significantly smaller than what some VCs may suggest. Here’s what you should know to balance employee fairness with founder equity preservation.
Option Pool Reality: Data from over 15,000 startups between 2020–2024 shows the median seed-stage employee pool is 11.8%, with the 75th percentile at 16.2%.
Why VCs Push Bigger Pools: Larger pools pre-round reduce their dilution but may over-allocate equity founders can later reclaim. On average, startups only use 60–70% of the pool before their next fundraising.
Planning for Growth: Seed-stage startups have slowed hiring compared to past years. Instead of overcommitting equity upfront, reserve enough for two years of hiring with the flexibility to replenish later.
✈️ KEY TAKEAWAYS
Founders should push back against unnecessarily large option pools in early rounds, leveraging data to preserve their equity while still supporting employee ownership.
Surprising Exit Math for Bootstrapped vs. VC-Backed Startups
Dirk Sahlmer breaks down the financial outcomes of bootstrapped vs. VC-backed SaaS exits, showing that the gap in take-home cash is smaller than many assume.
Exit Multiples and Valuations: Bootstrapped startups typically sell at a 4.1x revenue multiple, while VC-backed startups command a premium 10x multiple.
Dilution and Liquidation Preferences: VC-backed founders experience significant dilution—by Series C, they may own just 29%. Liquidation preferences also impact their final payout, especially in smaller exits.
Higher ARR, Higher Stakes: For VC-backed founders to see meaningful returns, they often need an ARR of at least $30M before an exit becomes financially rewarding.
✈️ KEY TAKEAWAYS
Big exit numbers don’t always mean big take-home pay—bootstrapping can lead to a similar financial outcome without heavy dilution.
INSPIRING TECH IN VC CONTENT💡
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“Data Driven VC is over”
A thought-provoking post by Lawrence from Lunar VC here, describing how access to private market data, modern tools, and the democratization of research have commoditized the identification of hot investment opportunities.
More than 4y after my initial post “The Future of VC: Augmenting Humans with AI”, my predictions (see extract below) seem to prove right and investors like Lawrence come to realize that it’s the data-driven aspect that surfaces and points you to the deal, but the human aspect and art of making adverse decisions and winning competitive deals.
While my 2020 predictions and Lawrence’ realization seem to be perfectly in synch, I disagree that “data-driven VC is dead because it’s a commodity”. The trend is right, but reality of many investment firms is still legacy processes. It’ll take more time to get there.
Today, we have clear evidence that these approaches make a big difference as adoption across the industry still lags significantly behind. In the future, not so much of a game changer anymore but it’ll remain an essential component that allows investors to surface, prioritize, and diligence the most promising opportunities.
In the end, as highlighted above, superior assessment of all relevant information and “access to deals will become increasingly important as most investors will compete for very few high potential deals — at (more or less) the same time.”
Augmented VC is the future. Trust me.