Why Capital Should Collapse Time, Not Patch Holes

I was talking with a founder the other day who told me, “We don’t really need to raise right now - we’re cash-flow positive.”

While it’s obvious that being cash flow positive is a good thing, that shouldn’t be the determining factor on if a company goes to market to raise or not.

You can build a profitable business and still move too slow.

We’re currently living in the best time in the history of mankind to build and grow companies.

With this privilege, comes the fact that everyone in the population has access to the same tools that allow them to move with extreme speed.

Meaning you need to as well.

A good way to think about the usage of the capital your company is raising is in the idea of buying time.

Time to hire before competitors do.
Time to scale into specific markets while everyone else is still cautious.
Time to lock in distribution while CAC is still low and attention is still cheap.

They’re not raising because they need to for cash flow purposes - they’re raising because they see the window.

As of right now, there are some things that are required to grow a company that cannot be copied with AI / new technology.

• Making good hires and building a lean, strong, team

• Making product advancements and objectively serving your customers in better ways

• Getting data points on your GTM strategy so you can scale your marketing and sales budget

ChatGPT or Claude cannot save you here (yet). But deploying capital into these areas gives you a strategic edge on all of your competition, no matter what they’re building or how fast they do it.

The irony is that the founders who don’t “need” to raise yet are often the ones who can deploy it most effectively.

Because they’re not raising to prove their model - they’re raising to scale what’s already working, and to do it faster, leaner, and more effective than any of their competitors.

In a game where everyone has access to the same tools, It’s likely that distribution is your real moat.

And the best way to capitalize on that is with the right capital.

Hope this was helpful.

Thanks for reading.

—
Ryan Bryden
Breakout Capital Group