Why VCs Push for Growth at All Costs — An Evolutionary Answer

I never understood why VCs used to push for growth at all costs. Growing fast means having a rate of return, a rate of change, faster than everyone else around you. Why is that the thing that matters? Why not profitability first, or product quality, or customer love? Why this obsession with the slope of the curve?

I had an epiphany today, and I think I finally see it.

It connects back to evolutionary history.

In evolution, it is not the biggest that wins. It is not the fastest that wins. It is not the strongest that wins. It is the one who adapts quickly — the one who changes the quickest according to what the current environment is asking for, and who is able to change and grow very quickly inside that environment.

There are really two cases, and both are about rate of change.

One: the environment changes. If you change very quickly in response, you survive. The slow ones, however large or strong they were in the old world, simply don't make it across.

Two: the environment doesn't change — it persists. In that case, if you grow very quickly inside that environment, you take more of it than anyone else, and you survive on the other side of the squeeze.

Either way, the variable that decides who is around in the long run is rate of change. Rate of adaptation. Rate of growth. Not size. Not strength. Not history.

And once I saw that, the VC model snapped into focus.

The VC push for growth at any cost is not really about growth as a vanity number. It is a bet on rate of change as the deciding factor. They are pattern-matching, consciously or not, onto the same logic that has been running for billions of years in biology. The companies that compound their rate of change the fastest are the ones that get to define the next environment. Everyone else is fossil record.

This also explains, very cleanly, why incumbents die.

In a particular category, in a particular section of capitalist society, incumbents don't have incentives to change. They are already winning the current frame. Their org charts, their P&L, their bonus structures, their internal politics — all of it is optimized to keep the current shape of the company intact. The whole machine is built to resist a fast rate of change. That is what kills them. Not laziness, not stupidity — a structural disincentive to move quickly.

Meanwhile, the challenger has nothing to protect. The challenger is rewarded for changing fast and growing fast, because that is the only path that gets them to "alive" in the next round. So the challenger evolves, and the incumbent freezes, and the gap closes from the bottom.

If you change super fast and grow very quickly, you will win. That is the rule. Hence the VCs' push to grow at a very fast rate actually makes sense, because what they are really funding is rate of change.

Looked at this way, "growth at all costs" stops sounding like greed or recklessness. It starts sounding like a survival instinct, dressed up in a term sheet.