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Lightcone · 2 min · Oct 30, 2026
Small SaaS teams can make fundraising optional
The hosts describe vertical SaaS teams reaching substantial revenue with few employees; Paul Copplestone says not raising can itself feel like an achievement.
In this episode
Full episode- 9:55AI makes a personal database useful to everyonePro pick 7 min
- 32:18Agent memory turns into a retrieval problemPro pick 6 min
- 19:55Supabase moved from dashboards to code as agents arrived3 min
- 23:31Supabase wants to win startups on day one and scale with them3 min
- 29:42Supabase makes errors actionable for coding agents3 min
- 17:53Supabase lets engineers choose their AI tools2 min
- 43:21Small SaaS teams can make fundraising optional2 min
- 45:25Supabase uses dogfooding and team capacity to adapt3 min
“to actually not fundraise now would in my mind be like, oh, that's achieving something great.”
Takeaways
- AI can let small teams reach substantial revenue.
- The hosts note that high margins can make a small team profitable.
- Copplestone says avoiding a raise can count as success.
About this segment
The hosts describe vertical SaaS teams reaching substantial revenue with few employees; Paul Copplestone says not raising can itself feel like an achievement. It reframes a difficult Series A as a chance to build profitably.
Paul Copplestone is cofounder and CEO of Supabase.
Garry Tan, Host · President & CEO, Y Combinator
Co-founded Posterous and Initialized Capital, an early Coinbase backer.
Harj Taggar, Host · Managing partner, Y Combinator
Co-founded Auctomatic with the Collison brothers and later Triplebyte.
Diana Hu, Host · Managing partner, Y Combinator
CTO of Escher Reality; after Niantic bought it, ran AR for Pokémon GO.
Jared Friedman, Host · Managing partner, Y Combinator
Co-founded Scribd, which YC funded in 2006; has advised 20+ YC unicorns.
From “Why Everyone Is About To Have Their Own Database”, Oct 30, 2026. Watch the full episode
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Transcript
Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.
- 43:25
and avoid a few few crazy events then then it should be a fun ride for a lot of people we're seeing this moment where vertical sass founders actually are kind of struggling with raising series a's uh you know when you're sub scale like you know five to ten mil arr even which like historically is a lot of arr like that's like a guaranteed series a even like nine or twelve months ago and today it's like uh i don't know people are kind of like not really into it um for vertical like horizontal and ai investments like seems like It's totally green light, but like vertical SaaS people are really struggling. But it's also sort of happening right at the moment where you can get to 10 to 15 mil, often 25, 30 mil, 50 mil with like 10 or 15 people. And so at that point, like, you're very profitable at that point.
- 44:19
Yeah, yeah, yeah. With like, if you've got 15 people, 2 million ARR per head and with 50% margins, you're all making a million a year. I mean, that's an amazing outcome for a lot of people. Yeah. Simultaneous to that, we just do a lot of office hours with people who do like they got the brass ring and then they're bummed out that they can't raise the Series A. And so, you know, many of my office hours there are just like, you're probably going to look back on this as a blessing because you don't need the money. Like time was you had to raise like a hundred million dollars to get to like 30 million a year in revenue because you just had to hire all these people. And now you don't have to do that.
- 44:56
Yeah. Yeah. There's a real thing in startups like the badge. I mean, it was the same for me, like to get funding at the start, like felt like, you know, I was achieving something great. But actually, you know, to actually not fundraise now would in my mind be like, oh, that's achieving something great. So I'm a little bit envious of these companies that are getting to that point. Yeah. So I don't know.
- 45:21
I mean, it's a super changing world, but your super base of all the companies has really been able to ride high through every single wave.