“you raised at a 20 million $30 million valuation now you're going to go to the market and say oh we're doing 500k of AR we want to raise at 50 million AR valuation and everyone's like no you're like not worth anywhere near that you can actually kind of like run yourself off a cliff with an otherwise good business simply by overshooting on valuation”

Overshooting valuation can run a good business off a cliff

Raising too much at an inflated valuation locks in a high watermark — 12 months later, revenue hasn't caught up to justify the next round, and the only paths are flat/down rounds or running out of cash. Set a fair valuation matched to a reasonable raise so the next round is achievable.