After reviewing 500+ pitches, I noticed one glaring pattern in revenue-based financing. Here is how the top 1% do it differently.
The Reality Nobody Talks About
A lot of the advice on revenue-based financing rests on assumptions that made sense five years ago. The world has moved on.
The first thing to understand is that your team matters more than your technology. I've seen this play out across dozens of companies. The pattern is unmistakable.
Many teams spend months on the wrong path before realizing that most founders overthink this and underspend on execution. Once they make the switch, everything changes.
What I've Learned From 95 Companies
A few patterns in revenue-based financing come up again and again.
The founders who handle revenue-based financing well understand that the best solutions are often the simplest ones.
The AI Angle
Any discussion of revenue-based financing in 2026 has to include AI. As someone who's invested in Anthropic, OpenAI, Scale AI, and Hugging Face, I have a front-row seat to how AI is transforming this space.
The short version: AI makes good practitioners better and bad practitioners worse. It's an amplifier, not a replacement.
Some teams use AI to get far more out of revenue-based financing. Others spend heavily on AI that solves the wrong problem. The difference comes down to understanding what you're actually trying to achieve.
This connects to broader themes around SAFE agreements, pitch deck design, revenue-based financing, Series A that I've been thinking about a lot lately.
Final Thoughts
There are no shortcuts in revenue-based financing, but there are smarter paths.
The strongest teams treat revenue-based financing as a competitive advantage, not a checkbox. They invest in it early, measure it obsessively, and never stop improving.
If you're just getting started with revenue-based financing, don't be intimidated. Everyone starts somewhere. The key is to start with the right mindset and the right framework, and then execute like your company depends on it. Because it probably does.
Frequently Asked Questions
Q:What experience informs this perspective?
This perspective comes from over a decade of building companies in Silicon Valley, two successful exits (RemoteTeam to Gusto, MovieLaLa to Gfycat), and investing in 234 startups including Anthropic, OpenAI, and Scale AI. I write about what I've lived.
Q:How can I apply this thinking to my own situation?
Start by identifying the core principle behind the opinion, not the specific example. Then ask yourself: does this principle apply to my context? If yes, test it in a small, low-risk way before going all in.
Q:Do all experts agree with this view?
No, and that's fine. The best ideas in business are often contrarian. I share my perspective based on my experience and data, but I encourage you to seek out opposing viewpoints and form your own conclusions.