Scope and Limitations of this discussion (i.e. The scaleup physics of Silicon Valley don’t apply here)

This study is based on my local experience, based on Canada and more specifically Montreal and Quebec.

Each ecosystem has its own startup physics. Bay Area startups (at least the ones I read about on Tech Crunch) can attract a $10M seed round, while here it’s more like $50k Cdn, or $100k if you’re plugged into the local accelerators like FounderFuel.

Growth ambitions are also different if you’re from the Valley. I would say that easily half of the startups I read about on TC echo a similar idea pitched at a local Startup Weekend or Demo Day. The difference is the network.

The scaleup physics also changes if one is B2C or B2B (or B2B2C). In the B2C case you’re trying to get lots of small LTV customers and the abandon rate is huge. In the B2B case, it’s more about getting a few customers (in the hundreds or thousands instead of the millions), with large LTV and hopefully lower turnover.

In the case of B2C, the user is the payor, while in B2B, there is one payor for hundreds of users.

This discussion and scaleup model will focus on B2B, software (SaaS) and hardware, and in the Montreal context.

I hope that further extensions of this study can validate its applicability to B2C and also broaden the applicability.

Although I doubt I will crack the code of Silicon Valley. I’m of the opinion that trying to do so will be counterproductive, because the scaleup physics of SV don’t apply in the real world.

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