“Here’s a check. Use it to build something cool.”

Here’s something you might not know: Startups are hard. They’re the ultimate form of delayed gratification.

“But startups move fast!”

Yeah, they do—but not in ways that financially reward the founder or even the company in the short term. Because of this, founders often seek out “short-term” and sometimes misguided forms of validation or success metrics to get a quick dopamine hit. After co-founding three venture-backed startups, working with many founders over the years, and spending a lot of time researching the space, I’ve realized that raising funding is one of the most common (and incorrect) forms of success validation for founders.

The VC Perspective

Before we get into the founder mindset, let’s talk about the other side of the table—Venture Capitalists.

VCs are essentially the highest level of elite gamblers. I say this with respect because it takes intelligence to be an elite gambler. They play the law of averages, placing bets across multiple startups in hopes (backed by risk analysis) that one will return a 1,000x outcome and cover the entire fund.

This means founders are, quite literally, the core product that VCs sell to their customers—their limited partners (LPs), the folks who put money into VC funds so those funds can be deployed.

VCs have a tough job. They spread themselves thin across portfolios, and a large number of them don’t make it past their first fund. Some manage to raise a second fund by tweaking their thesis if the first fund shows promising results. But if they don’t establish a consistent track record of wins, they’re often dismissed as having been lucky—an insult to any ambitious investor.

The Stages of VC Investment

There are a few different paths VCs can take in terms of investment timing:

1. Super early stage – Investing in a team of 2-3 founders working out of a crappy apartment, with no product or revenue.

2. Kind-of early stage – The team has a (crappy) product and maybe early or small revenue.

3. Early-ish stage – The team has at least $1M in annual recurring revenue (ARR) and is starting to scale.

4. Later stage – The startup is essentially a real business at this point and is focused on operational efficiency.

Each stage has pros and cons. But in general, the earlier the investment, the higher the risk—and the higher the potential reward. The earlier VCs invest, the more bets they need to place in hopes that one will succeed.

The Founder Perspective

Most founders are aware of the dynamic between startups and VCs. We know what we’re getting into when we choose to partner with a firm. Yet, it’s still disappointing when that relationship turns out to be hands-off or, worse, toxic.

Occasionally, you’ll find a supportive investor who genuinely wants to see you succeed. In my experience, these investors are often former founders themselves. But that’s the exception, not the rule. For most founders, the investor relationship ends up feeling either distant or dysfunctional.

The thing is—we don’t care in the beginning.

Why?

Because getting funded feels like we’ve already succeeded.

The Craving for Validation

Let’s be real—most founders crave that validation.

Even those who claim they’re focused solely on customers or products still feel a deep sense of accomplishment when a top-tier fund backs them. It’s human nature. It’s like getting a promotion, an award, or a degree. It taps into a familiar societal reward system that makes us feel like we’ve “made it.”

Founders chase validation for a multitude of reasons. Some are deeply personal, so it’s hard to generalize—but in most cases, it boils down to two core motivations:

1. They’re trying to prove something to themselves or others.

2. They want recognition and fame for building something great.

Neither of these is inherently wrong. At the end of the day, whatever keeps you moving forward is fair game. The problem arises when that need for validation corrupts your decision-making.

If you aren’t recognized in the way you want, you’ll keep seeking that dopamine hit from the wrong places.

Good vs. Bad Validation

There are two types of validation a founder can seek:

1. Customer validation

2. Investor validation

Customer validation is the good kind. When you genuinely care about your customers, and your product makes their lives better, that’s when you’ve built something real.

Here’s some good news: if your primary source of validation comes from customers, the journey will still be painful—but the bright spots will be truly memorable.

The bad kind of validation comes from things like fundraising.

Raising money is a necessary step for many startups, and it should be celebrated. But it’s important to recognize that fundraising is a tool—not an end goal.

When founders see each round of funding as a milestone of success, they fall into the false positive trap. You feel like you’ve accomplished something huge when, in reality, you’ve just secured more runway.

Why VCs Won’t Correct This

Here’s the harsh truth: VCs won’t correct that perception.

Why? They don’t need to.

A VC’s brand strengthens when their portfolio companies succeed. The more “great founders” they back, the more their reputation grows. Your success as a founder contributes to their track record, not the other way around.

So yes, it feels incredible to get money from a top-tier fund.

But don’t confuse that moment with actual success. It’s not the finish line.

Real success comes when you make your customers happy—and they pay you for it. Everything else is noise.

When Things Go Bad

When your company’s cash reserves are dwindling, and you’re counting down the months until you hit zero, the panic sets in. It’s a horrible feeling. You wake up in the middle of the night, you develop insomnia, you become irritable at home, and your personal life starts to fall apart.

It’s soul-crushing to know that everything you’ve built has a death timer on it.

In these moments, some founders lean on their investors, hoping for more capital to stay afloat. But the truth is, VCs typically only double down on their winners.

I’ve met too many founders who’ve said things like:

“When we raise, we’ll figure it out.”

“If we raise, we’ll just keep trying stuff until the money runs out. I’m sure we’ll stumble on something.”

These aren’t bad founders—they’re just being honest. The problem is, most founders won’t admit this mindset. But they should, because recognizing it is the first step to fixing it.

The Real Success Metric: Happy Customers

Here’s the truth: As a founder, you should feel successful when your customers are happy—and they’re paying you for it.

You might think you already feel this way. But if that were true, bootstrappers would be seen as the ultimate success stories instead of a niche few. If we truly celebrated revenue-first businesses, college dropouts would aspire to build bootstrapped companies instead of chasing VC funding.

But let’s face it—saying “a top-tier fund backed us” sounds cooler than saying “we’re profitable.” That prestige boosts the founder’s ego and gives a temporary feeling of being too big to fail.

Why VCs Can’t (and Won’t) Save You

In a perfect world, every VC firm would stick with every startup in their portfolio until success.

But that’s not realistic. As mentioned earlier, VCs have customers of their own—their LPs—and they need to show a strong track record of wins to keep their funds alive. That means they must focus their energy on their portfolio’s biggest successes.

I do think more VC firms should hire ex-founders to help advise startups. But whether that makes sense from a business perspective is unclear.

The Takeaway

Startups should focus on making money from customers first—and we need to create more cultural prestige around this metric.

The challenge is that this path seems much harder on the surface. Raising money to “try things out” feels more approachable and less risky. But in reality, both paths are equally difficult. One just gets marketed better.