Definition
The art of building a valuable company while raising as little outside funding as possible, preserving founder ownership and bragging rights. It's increasingly rare in an era of mega-rounds and bloated valuations.
Example Usage
Mailchimp was the poster child for capital efficiency, building a billion-dollar company without any VC funding.
Origin
Financial efficiency metrics adapted to startup contexts
Fun Fact
Capital efficiency fell out of fashion during the 2020-2021 boom but came roaring back when fundraising got difficult and profitability became cool again.
Source: Financial analysis and startup efficiency metrics
Related Terms
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See “capital efficiency” in Corporate Speak, Gen-Z Slang, Pirate Speak, and more.
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