Tripling Revenue No Longer Impresses VCs, DeTommaso Says

Founders who tripled revenue once walked into pitch meetings to applause. Today, the same growth curve can draw a polite shrug. Nicole DeTommaso, an investor who tracks venture-stage companies, captured the shift in a recent note: "Tripling revenue can be seen as underwhelming in current venture capital climate."

Her remark lands in a market where late-stage capital has thinned, public comparables have reset, and many growth funds hold portfolio companies bought at 2021 valuations. The bar for what counts as investable traction has climbed. A 3x top-line jump, the kind that once cleared Series B rooms, now competes against years of declining deal counts and a narrower buyer pool.

For founders, the practical question is straightforward: what does tripling revenue actually unlock right now? Less than it did three years ago, and the gap is widening.

What changed in the VC market to reset the bar?

The mechanics are familiar to anyone closing a term sheet these days. Limited partners pulled back commitments to growth and venture funds through 2023 and 2024. Capital that deployed gravitated toward AI, defense, and a few other categories. When buyers are scarce, sellers face higher bars on retention, gross margin, and the path to cash-flow positive.

DeTommaso's framing matters because she names, in plain language, a tension founders feel but rarely articulate. Growth at any multiple is no longer the headline. The question becomes: growth at what margin, into what market, with what kind of customer? A startup that tripled from a small base may have grown into a market too narrow for venture-scale returns.

How should founders reframe a 3x growth story?

Three adjustments show up most often in current investor memos. First, isolate the cohort that drove the growth and its gross margin from the broader book. Second, model what the next two years look like under a conservative scenario, not the optimistic one. Third, show how operational leverage extends the cash runway, rather than relying on another priced round.

None of this is new gospel. It is, however, a different vocabulary than the one that dominated pitch decks from 2020 through 2022. DeTommaso's observation captures the inflection: a metric that once read as a celebration now reads as a baseline.

What does this change for boards and operators?

It changes the conversation in every board meeting. Compensation tied to revenue milestones may need to be re-cut against profitability gates. Hiring plans funded on a 4x growth assumption may need to be reworked against a 2x baseline. Cap tables built on the assumption of a flat or up round are being redrawn for down rounds or extension financings.

For early employees holding options, the math matters. A tender offer or secondary at a flat or down valuation has very different consequences than one priced above the last round. Liquidity windows that were assumed to open in 2026 may slip.

What changes for limited partners and fund managers?

LPs should expect continued selectivity through 2025. GPs who underwrote growth bets at 2021 multiples face markdowns, slow distributions, and tougher raises for successor funds. That pressure flows back into portfolio companies as board emphasis on profitability replaces board emphasis on top-line at any cost.

DeTommaso, for her part, treats the moment as a recalibration rather than a collapse. Founders who can demonstrate efficient growth, durable cohorts, and a credible margin path remain fundable. Founders who can only show a revenue line that tripled will find more doors closing than opening.

The takeaway for practitioners is simple. In a venture market with fewer buyers and tighter terms, tripling revenue is the entry ticket. It is no longer the encore.