Last Money in is Powered by Sydecar

Sydecar empowers syndicate leads to manage their investments more effectively. Organize, manage, and engage your investor network effortlessly with Sydecar’s management and communication tools. Their platform also automates banking, compliance, contracts, tax, and reporting, freeing up syndicate leads to focus on securing deals and strengthening investor relations. Elevate your syndicate operations with Sydecar.

One Person, $1B Revenue: How AI Changed the VC Playbook

I saw a post from Henry Shi, the CEO of Super.com, the other week that showcased some of the capital efficiency and speed of scale of AI applications coming out. His post read [including only partial for readability]: 

“There’s a founder who generates $1B in ARR with just 30 employees. VCs are begging to invest, but he won’t take their money. 

No, that is NOT a typo. 

He is turning down funding. In 2025. 

The Silicon Valley I have known for 10+ years is unrecognizable now.

I spent the last 8 years building a $150M ARR company the traditional way: 200+ employees, raising $200M+ in VC funding, and a constant grind of growth at all costs.

But today, AI has completely changed the traditional startup playbook.

There used to be a time when startups needed hundreds of employees to hit their first $10M ARR. Those days are long gone. 

One person can now handle what used to require an entire department, whether it's customer service, marketing, coding, or research.

The economics are so mind-boggling that they sound made up:

• Old world: Burn $1M to generate $1M in revenue

• Today: Generate $1M in revenue on just $200K spend

• Tomorrow: Do it with $100K or less

These new-age lean AI-Native startups are thriving without VC money. They simply don't need it….

I've spent weeks collecting verifiable data on companies that meet these criteria:

• Revenue exceeding $5M ARR 

• Teams smaller than 50 people 

• Founded within the last 5 years

The data will leave you speechless:

• Average revenue per employee: $3.7M (10x the SaaS industry standard) 

• Average valuation/employee: $144M (14x the value for tech giants) 

• Average team size: 23 (compared to 100+ for normal startups)

There were 5 new companies that stood out on the list and were not extensively covered before:

• Telegram Messenger: $1B ARR => 30 employees

• fal: $40M ARR => 25 employees (full disclosure, i'm an angel investor)

• Cal AI: $12MM ARR => 4 employees

• OpenArt AI: $12MM ARR => 8 employees

• Solvely.ai: $6MM ARR => 4 employees

Looks like Sam Altman wasn't exaggerating when he predicted: "There will soon be a 1-person billion-dollar company."

This aligns with what we're seeing across some of our own portfolio. AI-enabled companies are achieving unprecedented efficiency gains, and the velocity at which outliers are scaling is unlike anything we've witnessed before.

An example from our own portfolio is OpenArt, which was featured in Henry’s analysis above. When we invested in their seed round in mid-2023, the company had minimal revenue. Just two years later, they've crossed $15M ARR—all without raising a new round. They're operating with “infinite runway” at current burn rates and have accomplished this scale with a lean team of just 10 people.

The New Venture Capital Landscape

The rise of ultra-efficient AI-native companies isn't just changing how startups operate—it's fundamentally reshaping the venture capital ecosystem itself.

Traditional VC models were built around the assumption that scaling requires substantial capital infusions. Companies needed millions to build teams, develop products, and acquire customers. But when a company like OpenArt can reach over $15M ARR quickly with just 10 employees and without mass amounts of funding, the entire premise of venture investing comes into question. 

These new economics are forcing VCs to reckon with a new reality: some of the best AI-native companies simply don't need their money & if you want to invest, expect to pay egregious multiples. Capital efficiency ratios that were once considered exceptional (1:1 burn to revenue) are now being dwarfed by companies operating at 5:1 or better—generating $5 in revenue for every $1 spent. 

While not every sector will see this level of capital efficiency—hardware, biotech, and deep tech will still require substantial investment—the broader trend toward more efficient scaling is unmistakable. For founders, and angel VCs, this represents an unprecedented opportunity. The ability to build significant value without dilution creates paths to meaningful wealth creation that weren't previously possible without large funding rounds.

This was actually our plan with Deal Sheet - our investment product that curates some of the best widely available SPV opportunities. We didn’t intend to take outside capital - there was no need. As more founders recognize they can scale without significant venture funding, we may be witnessing the early days of a complete reinvention of the startup ecosystem. 

How This Could Play Out...

The shift in capital efficiency we're witnessing with AI-native companies is likely the beginning of a fundamental restructuring of the startup funding ecosystem. Here's how this transformation might unfold:

1. The Rise of "One and Done" Funding - We're likely to see a dramatic shift toward minimalist funding approaches. The traditional Series A-B-C-D progression may give way to a simpler model:

• A single substantial seed round that provides enough runway to reach profitability

• Strategic growth rounds only for specific expansion initiatives, not day-to-day operations

• "Infinite runway" companies that grow exclusively through revenue, treating outside capital as optional rather than essential

2. Migration of Capital to Capital-Intensive Sectors - As software and AI application companies require less funding, we could see venture dollars flow toward sectors with inherently higher capital requirements:

• Hardware development and manufacturing

• Clean energy infrastructure

• Biotech and healthcare innovation

• Space technology and exploration

• Deep tech requiring significant R&D investment

3. The Emergence of New Funding Structures - Traditional equity-based venture funding may give way to more nuanced financial instruments. We’ve seen this in some form for decades including venture debt instruments to more recently revenue based financing options like Pipe and Capchase, but today these options feel like they can become much more mainstream: 

• Hybrid investment models with smaller equity components with consistent dividends 

• Revenue-based financing for AI companies with predictable cash flows

For founders, the message is clear: AI gives you superpowers. For angels and early investors, the opportunity is unprecedented—get in early on these capital-efficient rockets and watch your ownership percentages compound as companies grow without meaningful dilution. The companies being built today won't just be bigger than anything we've seen before—they'll get there faster, with fewer people, and less capital than we ever thought possible. The age of infinite runway has arrived. What are you going to build with it?

If you enjoyed this article, feel free to view our prior posts on adjacent topics 

• Why Syndicate Leads Don’t Survive 

• The Syndicate LP Churn Problem 

• What Really Drives Investment Interest in SPVs

Last Money in is Powered by Sydecar

Sydecar empowers syndicate leads to manage their investments more effectively. Organize, manage, and engage your investor network effortlessly with Sydecar’s management and communication tools. Their platform also automates banking, compliance, contracts, tax, and reporting, freeing up syndicate leads to focus on securing deals and strengthening investor relations. Elevate your syndicate operations with Sydecar.

If you enjoyed this post, please share on LinkedIn, X (fka Twitter), Meta and elsewhere. It goes a long way to support us!

Follow the Last Money In authors on LinkedIn

✍️ Written by Zachary and Alex