Rethinking growth marketing: why positioning matters

Boom and burst (2020–2022)

Only two years ago, vast sums of capital were flowing freely into venture-backed tech companies across Europe. Even early-stage startups with unproven business models found themselves commanding lofty valuations, while growth funds and so-called crossover investors fought to secure deals at breakneck speed. It truly felt like a golden age for founders and an affirmation of the disruptive potential of the tech growth playbook. Yet interest rate hikes and rising inflation turned that dream playbook upside down, forcing many investors to adopt an almost overnight shift from optimism to caution. Or at least pause.

Multiple forces converged to fuel a historic startup boom then: historically low interest rates (making capital cheap), a pandemic that accelerated digital adoption, and venture capital firms raising record-sized funds that they were eager to deploy (chasing AUM as a consequence).

Then came the reversal. By 2022, macroeconomic winds had shifted. Inflation spiked, and interest rates followed, ending the era of easy money. Suddenly, capital wasn't so cheap... Global startup funding fell by around 35% in 2022 - from $681B down to $445B, a sharper pullback than even after the 2008 financial crisis or the dot-com bust. Investor sentiment went from FOMO to F. Fear.

Signs of this reversal soon appeared everywhere. Late-stage unicorn startups raised at frothy peak valuations found themselves slashing their valuations and scrambling to cut burn. Many growth-stage companies deferred their IPO dreams indefinitely. Sequoia delivered a stark warning: brace yourselves in a memo shared with their founders titled Adapting to Endure. Tech giants imposed hiring freezes and then waves of layoffs, shedding tens of thousands of jobs. Across the board, the focus shifted from breakneck growth to efficiency and survival.

This sudden reversal has revealed two truths about VC. The first is that the power-law model, in which a few outliers make up for most failed bets, only works well if there is enough constant liquidity and an appetite for follow-on funding. The second is that inflationary pressures have undermined that model because the cost of capital is no longer near zero (i.e. Trump is willing to do quantitative easing the old way...). As a result, yes, investors are pulling back.

And the reversal starts. VCs slowly retreat to more measured pacing and diligence. Gone are the days of term sheets in 48 hours with no strings attached. In effect, the entire ecosystem is practising a form of austerity and recalibrating expectations. Down rounds have lost much of their stigma I remember from the 2020-2022 era, and are then seen as a pragmatic lifeline to weather the storm. Marketers don't even shy away from pitching them to the media. The power dynamic between founders and funders has normalised. It's a back-to-basics moment.

A separate stress comes from the changing face of the investor landscape. Where American investors once flooded the European market with growth capital, many are now retreating, hesitant to double down on unfamiliar regions in more challenging economic times. They are also slowly preparing a Trump-aha moment, which they hope will spread America's Dynamism (spoiler alert: it did work for them at least in the short term). Meanwhile in Europe, the surge of new micro funds, solo GPs, and angel networks at the seed stage has left the venture world highly fragmented, with too many players chasing too few genuinely exceptional deals.

The rise of sustainability to survive, not just to save the planet (2022-2024)

Despite these challenges, the market is going through a recalibration that will eventually produce opportunities for companies and investors that can operate in a lean, resilient manner. In fact, operating in a sustainable manner. The old growth playbook has to be reinvented. Smaller companies now have the chance to become capital efficient from the outset with AI, and they have a plethora of capital available now ready to unleash.

However, long-term sustainability (or resilience) involves more than adding AI to a slide deck when pitching investors. It also demands a measure of antifragility: an ability to absorb shocks from both economic cycles and external shifts such as climate change or geopolitical tensions. The past few months have provided ample reminders that events like supply chain breakdowns or sudden policy changes, or even new presidents, can upend even well-funded, well-managed ventures. Founders who embrace this chaos by design, building rock solid foundations, are more likely to build a company that can take advantage of these conditions rather than buckle under them.

In this new environment, the push towards profitability and stronger governance is more a design of financial prudence than following ESG standards or a genuine desire to save the planet in most cases. Companies which don't adapt to this new environment will simply not survive as more crises unpack. Except for rare instances when a startup can show a clear path to dominating its market (aka. AI), growth at all costs is dead. (i.e. The Profitable Startup, from Linear CEO Karri Saarinen)

A new type of companies (and investors financing them) (2025+)

And PE and VCs are coming together as if it was written. If VCs are geared towards power-law returns and often remain overly optimistic, PE shops prioritise mature, steady cash flows or very particular turnaround opportunities. A new class of investors that blends operational expertise, forward-looking strategy, and nimble financing instruments will emerge as consolidation happens over the next couple of years - in both funds and startups. This new class will be focused on identifying companies with a laser focus on strategy and positioning.

In the past, many startups put brand awareness and user acquisition ahead of true differentiation. I plead guilty to using that playbook, even if I was always more of a narrative guy than a performance marketing nerd... These startups were often launched with a "growth first, think later" mantra. Yet strategy is about choosing to perform activities differently, and competitive advantage comes from a unique position in the market, especially in economic uncertainty. If everyone is slashing budgets and pivoting (i.e. to become an AI-first company...), a clear strategic stance is rooted in deep market understanding. And the truth is that businesses long ago ceased to build proper thinking frameworks, leading to serious gaps. Or missed opportunities!

When capital was abundant, there was a glut of me-too startups. Uber for X. It was easy to attract first customers with a simple media article. But in today's climate, startups need a sharper edge. Startups probably need a strategy more than a distribution or growth engine. They need positioning more than marketing. They need to implement processes that build equity that no market downturn can erase. They also need a new type of investor.

In a world where you can't just burn cash for attention, you have to earn attention instead.