Part 14 of 19 in How to Make Your Own Luck: A Guide for Indian Founders← Part 13Part 15 →
This chapter explains how major startup decisions create linked follow-on bets. It helps Indian founders examine the consequences of a decision before acting on it.
- Large bets often create expectations and additional decisions.
- A high valuation can create pressure for rapid growth and higher spending.
- Increased spending can lead to unit-economic problems.
- Mapping the chain early can help founders slow down or restructure.
- Indian founders who raised aggressively in 2021 faced these linked bets when the market turned.
Every major bet creates follow-on bets. Raising a large round at a high valuation creates the expectation of rapid growth, which creates pressure to spend, which can create unit-economic problems. Map the chain before you place the first domino.
Indian founders who raised aggressively in 2021 discovered the linked bets the hard way when the market turned. Those who had pre-mapped the sequence were better prepared to slow down or restructure.
Frequently asked questions
What are linked bets in startup decision-making?
Linked bets are follow-on decisions and consequences created by an initial major bet.
How can a high valuation create problems for a startup?
A high valuation can create expectations of rapid growth, pressure to spend, and unit-economic problems.
Why should founders map the chain before making a major bet?
Mapping the sequence helps founders prepare for consequences and decide whether to slow down or restructure.
What happened to Indian founders who raised aggressively in 2021?
They discovered the linked bets when the market turned.