The biggest trap of raising too much money is what I call "Maserati Limbo". You have raised $70,80,90,etc. million and have a huge staff to support current ope

The biggest trap of raising too much money is what I call "Maserati Limbo". You have raised $70,80,90,etc. million and have a huge staff to support current operations. You might be just about break even or even worse, not profitable. With that amount of money raised you're sort of in a limbo while maybe driving a Maserati: 1) You're limited to being acquired by a handful of select companies. If they don't want you, yikes. 2) You would need to go public, but you don't have the rev numbers to justify it. So what often happens is the following: massive layoffs, fire sale occurs, and founders make diddly squat. The investors maybe make their money back and possibly .5-1x more due to liquidation prefs.