In recent years, the startup ecosystem has undergone a significant transformation. During the sector's boom, between 2015 and 2021, investors prioritized those that grew rapidly, without concern for long-term financial stability. However, with the global rise in interest rates starting in 2022 and the consequent reduction in risk investments (venture capital), the strategy became unsustainable. Today, the market demands solid financial models, a balance between growth and profitability, and a clear path to profitability.
Growth continues to be a relevant factor, but it must be aligned with a sustainable strategy. Instead of companies that grow 300% annually by burning cash, investors prefer those that grow 100% in a healthy way, without compromising the financial structure.
The end of growth at any cost
The era of "crescimento a qualquer custo"(growth at any cost) gave way to a new mindset." The market is now seeking businesses with long-term viability. Organizations that generate cash or are close tobreak even(break-even point) are the most attractive because they reduce dependence on constant funding rounds.
The change reflects the sector's maturity. Startups that previously managed to raise millions based solely on ambitious projections now need to demonstrate solid governance, operational efficiency, and concrete metrics that prove their sustainability. Transparency in financial processes and strict cost control have become decisive factors in attracting investments.
Most valued metrics
Operational efficiencyInvestors seek organizations that can optimize costs and improve margins, with solid financial foundations and well-structured processes.
Recurring revenueSubscription-based or long-term contract business models are more attractive because they ensure predictability and security.
Revenue increaseConsistent growth indicates that the company has found a solid market and has expansion potential without compromising financial health.
Cash burnOrganizations that maintain strict control over expenses are seen as better prepared to face economic challenges and avoid excessive dependence on new funding.
More selective and mature market
The euphoria phase of startup investments has given way to a more cautious scenario, as a result of a significant change in the mindset of investors, who now seek companies with solid governance, well-structured processes, and financial efficiency. For entrepreneurs, this means that raising funds requires much more than a good story: it is necessary to demonstrate that the business has the structure to sustain itself and grow in a balanced way. The market is more mature, and those who manage to adapt to this new reality will have a better chance of prospering and attracting investments in the long term.
