The VC who laughed at our revenue model in Toronto, turns out he was right

Ngl, I spent 18 months building a payment tool for freelancers and pitched a VC at a Toronto fintech event back in March. He asked how we planned to make money off micro-transactions, and I gave him this whole spiel about volume and data. He just nodded and said, "Volume eats margin, but it doesn't pay for compliance." I brushed it off then, but after 2 rounds of our own fee hiking and customer churn, I get it now. Has anyone else had a rejection that only made sense a year later?

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dianahayes2d ago

Oh boy, this one stings to read because I've been there in a smaller way. That line about compliance is the kind of thing you just nod at, then it keeps you up at night two quarters later. My take, in my experience, most founders confuse revenue with margin, and investors smell that from a mile off. Takes a year of painful fee changes to learn the lesson, but better late than never, right? Take this with a grain of salt, but I'd rather get laughed at in March than found out in December.