Cursor Went From 1M to 1B Revenue in Two Years

Startups did not go from $1 million -> $1 billion of revenue in 2 years...until now.

And everything has changed because of it.

Cursor (well actually Anysphere, which is the company name even though everyone knows Cursor) raised a massive round at a nearly $30B valuation. The main reason for that eye-popping headline figure was their growth from $1M to $1B in the 2 years since Cursor launched.

(Showing Cursor as the ur-example, but you could pick Lovable or the foundation labs or a number of other speedsters).

What does this mean for everyone else in startups?

• "Great" growth has been redefined. When the top end of the market experiences such a profound change in a short period of time, the trickle down effect of increased expectations hits everyone.

• That redefinition explains a lot of the seemingly odd behavior from venture participants lately. Why are they (and by they I mean big funds, usually) so disinterested in companies that are growing well? Because well is not great, and great is higher now.

• There's only so much oxygen in startups across many narratives. When one narrative (like AI code creation) gobbles up oxygen to itself, other narratives and sectors will suffer from disinterest. Is this right? No. Does this happen? Yes.

• Revenue expansion at this rate completely overwhelms any concerns about margin, profitability, etc. It really doesn't matter in the moment.

Historic revenue run rates + 12x valuation pops in a single calendar year...and very few IPOs to speak of. This dichotomy explains the frenzy of attention on getting retail (or retail-ish) access to the late stage private markets. See Robinhood's latest fund as a clear example.

I think it's more important than ever for founders to be thoughtful about whether they should ever take venture money these days. Committing to someone else's growth goals was always a challenge – but when what counts as great moves this quickly, that challenge is multiplied.

As always, run your own race!