Revenue Before Rounds

Entrepreneur Office hours - Issue #319

Inside the Office

-Shep Moyle

Ring that cash register! — Photo by Ramiro Mendes on Unsplash

A few weeks ago, I sat down with a small group of student entrepreneurs during office hours. Smart. Motivated. Well-prepared. They had slides, a crisp narrative, and a clear goal for the meeting.

Within the first five minutes, each of them said some version of the same thing:
“Our top priority right now is raising money.”

So asked a simple follow-up question: “Why?”

Their answers came quickly. We need capital to build. Investors expect us to raise. We want credibility. Everyone else is fundraising. None of the answers were irrational. But none of them were right either.

I asked another question: “What would change if you didn’t raise money for the next six months?”

Silence.

That silence is where the lesson lives.

For most early-stage entrepreneurs — especially today — raising money is often a distraction disguised as progress. It feels productive, it sounds important, and it earns admiration. But it frequently delays the one thing that actually matters early on, which is revenue.

I told them what I’ve seen repeatedly over 30+ years as a CEO and board member. The fastest way to de-risk a venture isn’t with a polished pitch deck. It’s with a customer who pays you.

Revenue does three powerful things immediately. First, it proves someone cares enough about the problem to part with real money. Second, it forces clarity. When customers pay, feedback gets honest very quickly. Third, it gives you leverage over investors, over timelines, and over your own confidence.

With this in mind, I helped the entrepreneur restructure their approach. Instead of “How do we raise money?” we asked: “How quickly can we get to your first dollar?”
Then: Your tenth. Your hundredth. Your thousandth.

Thanks to that shift in focus, the ideas became more concrete. One team realized they could charge for a stripped-down version of their product immediately. Another saw they could offer a paid service before building software. A third realized they could pre-sell to early adopters and learn while delivering manually.

We also talked about how different this moment is for entrepreneurs. AI tools now make it possible to prototype, test, launch, and iterate faster than ever and often without any outside capital. You can build MVPs in days, automate workflows, personalize outreach, and test pricing in real time. The constraint isn’t technology or funding. It’s value — and proving your startup has it. Because if you can’t get customers to pay you $1, you can’t expect investors to give you $1 million.

Conversely, if you can get customers to pay you, you may find you don’t need the money nearly as much as you thought.

To be clear, raising capital isn’t bad. But it’s a tool—not a milestone. Revenue is the milestone. And it’s why the best founders I know don’t ask, “How fast can we raise?”
They ask, “How fast can we learn, and how fast can we get paid while doing it?”

That mindset changes everything.

-Shep

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Worth Your Time

-Aaron Dinin

Yes, the article I’m sharing with you this week is about the increase of emojis in medical records. I realize it probably seems a little… random. But once you’re done rolling your eyes, I want you to stick with me as I explain.

Remember that language is always evolving, which means what feels informal, unserious, or even inappropriate in one generation becomes standard in the next. And while the study I’ve linked to doesn’t appear to break down age demographics, it’s not hard to imagine that younger physicians — people who grew up communicating with emojis — are the ones normalizing their presence in professional settings. What once felt wild or unprofessional becomes simply… normal.

That’s the entrepreneurial lesson and why I’m sharing this article. As you read it, remind yourself that industries don’t change because everyone collectively agrees to modernize. They change because new people enter them carrying new defaults, which means the “right way” to do things slowly shifts as older norms age out and newer norms take their place.

This type of evolution matters because smart entrepreneurs carefully watch the cultural drift in search of opportunity. And even though you’re probably not going to read that 40 confused face emojis (😕) appeared in medical records and think “Eureka! I’ve got my billion dollar idea!”, if you’re savvy, you’re going to see how “normal” changes, and you’re going to apply that lesson with a big 😁.

Or maybe it’s a 🤑?

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Tools We’re Tinkering With

-Ryan Bolick

Editor’s note: All resources suggested in this section are based on our opinions. These aren’t affiliate promotions and we don’t generate commissions.

I built ShipItBot to turn vague startup ideas into clear, buildable briefs. You describe what you want to make, who it’s for, and why it matters, and it structures that into something an AI builder or engineer can actually work from. It’s interesting because it focuses less on generating output and more on clarifying intent, which is often the real bottleneck between thinking and shipping.

Give it a try, and let me know what you think!