Getting off the VC Treadmill with Brandon Arvanaghi, CEO of Meow
Feb 14, 2025
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Brandon Arvanaghi, CEO of Meow, is a fintech innovator who transformed his venture from a money-burning crypto firm to a profitable enterprise. He advocates ditching the VC treadmill, emphasizing lean operations and profitability over high-risk growth. Brandon likens Meow to âCostco for financial services,â focusing on low prices and customer savings. He critiques the herd mentality of VCs and highlights the importance of real, sustainable innovation. His insights challenge the glamorized startup narrative, promoting resilience and long-term success instead.
Brandon emphasizes the significance of profitability as a foundation for sustainable growth, distinguishing Meow from capital-driven startups.
The conversation critiques venture capitalists for their herd mentality, illustrating the disconnect between founders' needs and investor motivations.
Brandon advocates for a Costco-like model in fintech, prioritizing customer savings over inflated prices to ensure long-term loyalty.
Deep dives
Celebrating Profitability as a Milestone
The podcast highlights the importance of celebrating profitability as a significant milestone for growth-oriented companies like Meow. Many startups tend to focus on raising capital rather than achieving sustainable business practices, making the CEO's emphasis on profitability noteworthy. This achievement allows the company to prioritize customer needs and maintain independence from investor pressures. The conversation positions profitability not just as a goal, but as a foundation for long-term strategic development.
Navigating the Venture Capital Landscape
The discussion delves into the challenges and dynamics of working with venture capitalists (VCs), especially during periods of market volatility. The CEO recounts experiences from previous fundraising rounds, illustrating how investor behaviors can change drastically depending on market conditions. There is a pronounced skepticism towards VCs and their true motivations, highlighting a lack of genuine interest in the companyâs wellbeing. This reveals a tension between startup founders and VCs, where understanding the underlying goals is crucial for a healthy working relationship.
The Shift from Crypto to Financial Services
The narrative transitions from Meowâs origins in the crypto space to its current focus on offering financial services with a customer-centric approach. The CEO discusses how the company pivoted after major industry shifts, like the collapse of key players in the crypto market, which reinforced a commitment to prioritize customer trust. This pivot allows Meow to harness both traditional and innovative aspects of finance to create a unique competitive advantage. By building a dashboard for buying treasury bills, for instance, the company seeks to cater to existing customer needs effectively.
The Costco Model for Financial Services
A central theme in the conversation is the adoption of a Costco-like business model in financial services, which emphasizes volume over margins to benefit customers. This model promotes passing savings directly to customers rather than inflating prices to maximize profits. By leveraging the flexibility of fintech, Meow aims to negotiate better deals for its users. This approach positions the company towards long-term sustainability and customer loyalty, building a robust business framework that challenges traditional competitors.
Emphasizing Lean Operations and Real Growth
The podcast advocates for a lean operational strategy and a focus on genuine growth over traditional funding metrics. The CEO argues that many startups fall into the trap of excessive hiring and spending, losing sight of what defines a successful business. By keeping the team small and efficient, founders can respond nimbly to market demands while being accountable to customer needs. This philosophy posits that a deep understanding of real business dynamics and disciplined growth is essential for success in today's startup environment.
This week we sat down with Brandon Arvanaghi from Meow.com to discuss his journey from money burning crypto company to profitable fintech. His tweet last year about hitting the profitability milestone had some obvious, and some less intuitive, take aways from their experience. Everything from opting out of the VC treadmill to applying the Costco model to low margin financial services.
Some other key takeaways:
- Brandon built Meow to $1B+ in assets with just 12 people by rejecting Silicon Valleyâs âgrowth at all costsâ playbook. His secret? Being profitable and savage about staying lean. âThe future is lean - you canât go from 1000 people down to 10 and pass back savings, but you can stay lean from the start.â - Brandonâs building Meow like âCostco for financial servicesâ - focusing on rock-bottom prices and passing savings to customers vs the typical VC-backed approach of sneakily raising prices to hit growth targets. He believes in 5-6 years, when pricing becomes fully transparent, this will be the only way to compete. - âVCs are lemmingsâ â Brandon says the 18-month runway advice is a psyop to keep founders dependent on VCs. He argues most VCs just follow each other and care more about looking good to their LPs than helping build real businesses. The rare exceptions? Maybe 1 in 20 VCs. - âStay in the game, win the gameâ - Brandon argues real innovation doesnât require betting on non-existent markets. His advice? Pick obvious bets without market risk, stay profitable, and make them 10x better through execution. âHow can you not make a generational outcome if you just keep pushing the ball forward?â
Big thanks to Brandon for really going there with us. He shares lived experience around many of the ideas we've been advocating for at indie for years. To see someone so fully embrace those ideas and find incredible success on the other side is great validation for others wishing they could go their own way too.
We hope you enjoy listening to this one as much as we enjoyed recording it.
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