The entrepreneurial journey is rarely a straightforward path, even less so when venturing into the world of investments and startups. Recently, the spotlight has turned to an intriguing concept in the venture capital world: “zombie” startups. As I, Violetta Bonenkamp, have navigated the tumultuous sea of entrepreneurship for over 20 years, I’ve closely observed this trend and its implications for entrepreneurs and business owners. What fascinates me most is the rise of so-called “hold forever” investors who are eagerly snapping up these stagnant ventures and turning them into profitable ventures. The world of startups isn’t as binary as succeeding or failing , the gray area, or the “zombie zone,” holds untapped potential.
Let’s dissect the phenomenon, identify the key players, understand what it means for you as an entrepreneur, and explore how to capitalize on this trend.
The Concept of the "Venture Capital Zombie"
A venture capital zombie is a startup that no longer garners interest or additional funding from venture capitalists. Typically caught in perpetual stagnation, it neither grows significantly nor collapses entirely. Instead, they sit idly with burnt-out cap tables, minimal cash flow, and, sometimes, solid fundamentals that are just overshadowed by their inability to meet aggressive growth expectations.
From a psychological perspective, entrepreneurs often fall victim to what's termed "escalation of commitment." This tendency to ‘ride or die’ with their vision has created a horde of zombie startups. While traditional VCs may cut their losses and refocus on a few fast-growing unicorns, “hold forever” investors see these zombies as opportunities in disguise.
A New Hope: The “Hold Forever” Strategy
Here comes the twist: “hold forever” investors. I am intrigued by this approach because it challenges the short-termism of traditional venture capital models. Instead of scaling back, flipping, or exiting quickly, these investors focus on sustainability. By acquiring and optimizing zombies , instead of running from them , this new breed of long-term thinkers transforms struggling companies into long-lasting money-makers.
Take Bending Spoons, for instance. This Italian tech firm acquired iconic but dwindling brands like AOL, Evernote, and Meetup (read more about the Bending Spoons model on TechCrunch). Dubbed as a “perpetual owner,” they employ a playbook that focuses on fixing operations, leveraging economies of scale, and pushing underperforming companies to profitability without chasing the fleeting burst of exponential hypergrowth.
Another notable name in this space is Curious Holdings. Under the leadership of Andrew Dumont, Curious specializes in reviving these zombie companies to build enduring portfolios. Through strategic cost-cutting, centralized management, and a long-term commitment, Curious turns even subscale SaaS startups into profitable entities.
The Zombie Explosion: Stats and Trends to Watch
Data reveals the scale of the opportunity:
- 33.7% drop: U.S. VC fundraising declined by this percentage in a recent year, as reported by Medium in their Q3–2025 VC funding analysis.
- 50% increase in zombie firms: As of Q3 2025, around 574 venture capital funds had ceased raising new rounds , a massive increase compared to the prior year.
- Decreasing startup shutdowns: Intelligent investors and firms like Tiny and SaaS.group are rushing to invest in stagnating startups, creating new avenues for struggling founders.
A Practical Guide: Could Reviving a “Zombie Startup” Be for You?
For entrepreneurs or business owners exploring their options, this is how you can take advantage of this growing trend.
1. Recognize the Opportunity
- Assess your business. Could a “hold forever” player see potential where others see failure?
- Evaluate your business identity. Often “zombie” tags are slapped on small, resilient businesses that just don’t have the growth trajectory for venture capital.
2. Tidy Up Your Cap Table
- A common hurdle to investment is a messy cap table with too many stakeholders. Work towards simplifying ownership structure to become attractive to these investors.
3. Focus on Profitability
- VCs seek explosive growth, but “hold forever” investors prioritize viable revenue streams and strong unit economics.
- If you don’t have profitability, pivot to profitable niches. Think about scaling sustainably, even if that means growing smaller at first.
4. Use the Right Tools for Optimization
- Tools like the Fe/male Switch Startup Game (which I developed) can guide you through building a sustainable business model, teaching you to master the financial and operational aspects of running a startup.
5. Stay Nimble with AI
- Artificial Intelligence and automation are key to competing today. My own projects work towards democratizing access to AI-driven solutions for entrepreneurs, helping them optimize their operations with minimal resources.
Common Mistakes to Avoid When Running a “Zombie Survival” Business
- Resisting Change: Too many founders fall into the trap of remaining too attached to their original vision, rather than reimagining the business to suit reality. Let go of what doesn’t work.
- Ignoring Scalability: While you don’t need to grow ‘aggressively,’ investors will still expect scalability over time. Ensure your business model has “lever-up” potential.
- Losing Track of the Customer: Even zombies thrive when aligned with customer needs. Core offerings should adapt to changing markets and emerging trends like AI.
Violetta’s Insights for Entrepreneurs: Perspective Matters
It might seem contradictory to build an empire out of stagnating companies. VCs and startups have fostered the idea that anything other than runaway success is failure. As we’ve seen now, that’s just not true. Instead of letting zombie startups dwindle into irrelevancy, “hold forever” investors are preserving and rejuvenating these ventures, bringing stability and utility to markets that still need them.
For founders, the takeaway is clear. Not every business needs to be a unicorn. There's value in reevaluating your company’s potential, focusing on profitability, and marketing yourself wisely to investors who cherish enduring models.
Adopt patience. Adopt grit. After all, a zombie may only need a little life infusion to turn into a cash engine.
Are you ready to reconsider zombies?
FAQ
1. What is a "zombie startup" in venture capital?
A zombie startup refers to a company that no longer grows significantly nor collapses entirely, often unable to attract additional VC funding but still operating with existing resources. These startups are characterized by stagnation and a failure to meet aggressive growth expectations.
2. Who are “hold forever” investors, and how do they differ from traditional VCs?
“Hold forever” investors specialize in acquiring stagnating or "zombie" companies with the goal of making them sustainable and profitable for long-term ownership. They focus on optimization and perpetual ownership rather than rapid growth and quick exits like traditional VCs. Explore Curious Holdings
3. Can you provide an example of a successful “hold forever” strategy?
Bending Spoons is a prominent example. This Italian tech company has acquired well-known but declining firms like AOL, Evernote, and Meetup, turning them profitable through cost cuts, operational efficiency, and sustainable scaling. Discover Bending Spoons
4. What led to the rise of zombie startups in the VC landscape?
The rise can be attributed to the venture capital power law, where most investments fail to achieve massive growth. Furthermore, market conditions, declining VC investment, and unrealistic growth benchmarks set by investors play a role in creating stagnating "zombie" firms. Learn more from TechCrunch
5. How do “hold forever” strategies create value in zombie startups?
These strategies prioritize operational efficiency by centralizing administrative functions, reducing costs, and focusing on profitability. For example, Curious Holdings revamped UserVoice, a stagnating SaaS company, into a profitable firm. Check out UserVoice’s journey
6. What makes zombie startups attractive to investors like Tiny or Calm Capital?
Such companies often have durable recurring revenue streams and sound fundamentals, but lack the hypergrowth needed to remain attractive to traditional VCs. They can be purchased at lower valuations, often at 1x revenue, and then optimized for long-term gains. Learn about Tiny | Learn about Calm Capital
7. Are other major firms investing in zombies?
Yes, notable players include Tiny, SaaS.group, Curious Holdings, and Bending Spoons. These companies leverage the "buy, fix, and hold" strategy to turn underperforming firms into profitable cash-generating assets. Understand SaaS.group’s role
8. What market conditions are contributing to the zombie startup phenomenon?
The phenomenon has been accelerated by a decline in VC fundraising, decreasing startup shutdowns, and the emergence of AI-native competitors making older models less relevant. Explore Q3–2025 trends via Medium
9. Is there a specific criterion for startups to attract "hold forever" investors?
Startups looking to attract “hold forever” investors need clear recurring revenue streams, strong unit economics, and a simplified cap table. It's essential to shift focus from growth at all costs to sustainable profitability.
10. What are the risks or hurdles associated with this model?
Challenges include operational intensity, aligning incentives within aging cap tables, and the extensive time and energy required to turn sub-scale companies into viable, profitable businesses. Even successful players like Bending Spoons and Curious Holdings highlight the necessity of patience and skill. Check Bending Spoons case study
About the Author
Violetta Bonenkamp, also known as MeanCEO, is an experienced startup founder with an impressive educational background including an MBA and four other higher education degrees. She has over 20 years of work experience across multiple countries, including 5 years as a solopreneur and serial entrepreneur. Throughout her startup experience she has applied for multiple startup grants at the EU level, in the Netherlands and Malta, and her startups received quite a few of those. She’s been living, studying and working in many countries around the globe and her extensive multicultural experience has influenced her immensely.
Violetta Bonenkamp's expertise in CAD sector, IP protection and blockchain
Violetta Bonenkamp is recognized as a multidisciplinary expert with significant achievements in the CAD sector, intellectual property (IP) protection, and blockchain technology.
CAD Sector:
- Violetta is the CEO and co-founder of CADChain, a deep tech startup focused on developing IP management software specifically for CAD (Computer-Aided Design) data. CADChain addresses the lack of industry standards for CAD data protection and sharing, using innovative technology to secure and manage design data.
- She has led the company since its inception in 2018, overseeing R&D, PR, and business development, and driving the creation of products for platforms such as Autodesk Inventor, Blender, and SolidWorks.
- Her leadership has been instrumental in scaling CADChain from a small team to a significant player in the deeptech space, with a diverse, international team.
IP Protection:
- Violetta has built deep expertise in intellectual property, combining academic training with practical startup experience. She has taken specialized courses in IP from institutions like WIPO and the EU IPO.
- She is known for sharing actionable strategies for startup IP protection, leveraging both legal and technological approaches, and has published guides and content on this topic for the entrepreneurial community.
- Her work at CADChain directly addresses the need for robust IP protection in the engineering and design industries, integrating cybersecurity and compliance measures to safeguard digital assets.
Blockchain:
- Violetta’s entry into the blockchain sector began with the founding of CADChain, which uses blockchain as a core technology for securing and managing CAD data.
- She holds several certifications in blockchain and has participated in major hackathons and policy forums, such as the OECD Global Blockchain Policy Forum.
- Her expertise extends to applying blockchain for IP management, ensuring data integrity, traceability, and secure sharing in the CAD industry.
Violetta is a true multiple specialist who has built expertise in Linguistics, Education, Business Management, Blockchain, Entrepreneurship, Intellectual Property, Game Design, AI, SEO, Digital Marketing, cyber security and zero code automations. Her extensive educational journey includes a Master of Arts in Linguistics and Education, an Advanced Master in Linguistics from Belgium (2006-2007), an MBA from Blekinge Institute of Technology in Sweden (2006-2008), and an Erasmus Mundus joint program European Master of Higher Education from universities in Norway, Finland, and Portugal (2009).
She is the founder of Fe/male Switch, a startup game that encourages women to enter STEM fields, and also leads CADChain, and multiple other projects like the Directory of 1,000 Startup Cities with a proprietary MeanCEO Index that ranks cities for female entrepreneurs. Violetta created the "gamepreneurship" methodology, which forms the scientific basis of her startup game. She also builds a lot of SEO tools for startups. Her achievements include being named one of the top 100 women in Europe by EU Startups in 2022 and being nominated for Impact Person of the year at the Dutch Blockchain Week. She is an author with Sifted and a speaker at different Universities. Recently she published a book on Startup Idea Validation the right way: from zero to first customers and beyond, launched a Directory of 1,500+ websites for startups to list themselves in order to gain traction and build backlinks and is building MELA AI to help local restaurants in Malta get more visibility online.
For the past several years Violetta has been living between the Netherlands and Malta, while also regularly traveling to different destinations around the globe, usually due to her entrepreneurial activities. This has led her to start writing about different locations and amenities from the POV of an entrepreneur. Here’s her recent article about the best hotels in Italy to work from.
About the Publication
Fe/male Switch is an innovative startup platform designed to empower women entrepreneurs through an immersive, game-like experience. Founded in 2020 during the pandemic "without any funding and without any code," this non-profit initiative has evolved into a comprehensive educational tool for aspiring female entrepreneurs.The platform was co-founded by Violetta Shishkina-Bonenkamp, who serves as CEO and one of the lead authors of the Startup News branch.
Mission and Purpose
Fe/male Switch Foundation was created to address the gender gap in the tech and entrepreneurship space. The platform aims to skill-up future female tech leaders and empower them to create resilient and innovative tech startups through what they call "gamepreneurship". By putting players in a virtual startup village where they must survive and thrive, the startup game allows women to test their entrepreneurial abilities without financial risk.
Key Features
The platform offers a unique blend of news, resources,learning, networking, and practical application within a supportive, female-focused environment:
- Skill Lab: Micro-modules covering essential startup skills
- Virtual Startup Building: Create or join startups and tackle real-world challenges
- AI Co-founder (PlayPal): Guides users through the startup process
- SANDBOX: A testing environment for idea validation before launch
- Wellness Integration: Virtual activities to balance work and self-care
- Marketplace: Buy or sell expert sessions and tutorials
Impact and Growth
Since its inception, Fe/male Switch has shown impressive growth:
- 5,000+ female entrepreneurs in the community
- 100+ startup tools built
- 5,000+ pieces of articles and news written
- 1,000 unique business ideas for women created
Partnerships
Fe/male Switch has formed strategic partnerships to enhance its offerings. In January 2022, it teamed up with global website builder Tilda to provide free access to website building tools and mentorship services for Fe/male Switch participants.
Recognition
Fe/male Switch has received media attention for its innovative approach to closing the gender gap in tech entrepreneurship. The platform has been featured in various publications highlighting its unique "play to learn and earn" model.