A script is generally accepted in the Silicon Valley: Identify the idea of the startup. Sell a piece of your company to gather the Venture capital. Make a sale. Collect more Venture Capital and make more sale. Repeat until the company is made public or acquired, I hope that in any case for billions.
But what if you didn’t take the treadmill to lift funds after the first round? What happens if you organize your company so that it falls to profitability through slower, sustainable development, not the opposite-non-relentless growth-like many firms supported by VC?
This is a query that Pukar Hamal, founder and general director SecurityPal AIHe asked himself after collecting a round of series A $ 21 million in 2021, and a yr later there’ll be almost missing money. The round led through Ventures David Sacks, with the participation of Martin Casado Andreesen Horowitz and co -founder Okta Frederica Kerrest.
“I founded the company in March 2020. This is my second company I founded,” he said this week in the techcrunch Equity podcast.
He said that his previous company, which sold through the takeover, collected its first capital before matching the product market. It’s quite common. The founders often bring up before they receive a product for which they know that customers can pay well.
In retrospect, Hamal described this decision as his great “mistake”.
So in the case of SecurityPal he made the opposite. He waited for the company to achieve $ 1 million ARR, which took about a yr, and then made its first and only increases, series A.
TechCrunch event
San Francisco
|.
October 27-29 2025
SecurityPal uses artificial intelligence to speed up the due diligence of the company’s security, which occurs in every large company transaction when signing latest IT contracts. SecurityPal guarantees to scale back the security review from months to days or hours, helping firms lower your expenses on the process during faster closing of offers. He has great clients, corresponding to Airtable, Figma, Langchain and Grammarly.
But in 2022 he faced a crisis. The rates of interest have increased and broke the Venture Capital market. Collecting more funds would be difficult. “We smoked a lot of capital,” he said. “We were 14 months old.”
It was a get up. Hamal needed to drastically reduce expenses, which meant a large release. It was so painful, he said that he vowed to do things in a different way. “We have expanded our runway and tried to bring the company to interrupting cash flows-the unfiring of positive cash flows,” he said.
Although in 2025 VC money flows again, especially in the case of AI startups, “we did not gather the next round,” he said. Reason? Now he sees that VC money has its own price.
“The more we raise the capital, the more expectations will be, the more we give up control over the company, the greater the pressure we will simply hire a group of people who may not work,” he said.
“In the case of Venture Capital, the growth counts,” he said. He said that for some investors a rapid increase in revenues is more essential than improving the gross margin.
This signifies that the company may fall red, even if it sells more. VCS will trust that the founders will come up with profitability later. Until then, they will raise funds. And if they cannot, the company may not survive.
Hamal wanted what he described as a “permanent increase” of security: slow and solid. If sales were limited to a handful of implementation at any time, his team could assure that every one customers were well implemented, even in the case of their advantage.
He didn’t want quick sales only customers to not use the product, and the departure is coming. “This story happens all the time because companies have such a lot of pressure on development,” he said.
On the other hand, he said that he said that a slow ARR could lead on to “healthy gross margins, a great cash collection.”
Hamal is clear that he is not in favor of Venture Capital. Other startups may be needed to lift and prosecute fast ARR. It does not even exclude the next round for security. He just wants more founders to think about slow growth, refined alternatives.
“I collected the Venture capital. And I did not collect it again because I try to make a company in a situation where I do not need increased risk capital,” he said.