At least in Europe we've seen quite many small teams become break-even or profitable with ~$100k. One of the advantages in Europe is the possibility of having full-time employees at a fully loaded cost of $1500-3000 per month. Make $10-20k in MRR per month and you're nicely profitable with a team of 5-10. Grow from there. Most of these sell B2B or other SaaS solutions with 80+% of customers in the US.
You can get there with $100k in many cases in 12-18 months if not sooner. Might not be a huge VC business, but still a sustainable growing SME.
We've raised $200k with Weekdone (https://weekdone.com/) but are taking a similar path currently. 5 persons, around break-even, growing month by month. Not really looking at additional investment for now, but might consider someone like Indie.vs if there's a good fit.
A company I know did annual revenues of 0, 50k, 250k, 750k, 1.2m, 1.8m and over 2m this year. Pays good dividends. No outside investment. Some of the financing in early days was generated by custom software dev work. Have seen quite some similar ones around.
$1500 fully loaded per month? That's barely minimum wage / working at McDonalds level pay in the states. In the states, just the cost for health insurance for a family of 4 is going to run $1500+ per month.
Your 0-50k-250k-750k-1.2m-1.8m-2m+ progression sounds like a great starting point for analysis. If that's a 3 - 4 person founding team, assuming these are top notch employees that could earn $100k/yr on the open market, that's at least $150k fully loaded per employee, 12 person-years before break-even, that's $1.8m for payroll, taxes, and benefits. Throw in another $500k for company expenses at least.
Now, to some extent (ignoring the legal/tax issues) you can ask the founding team to contribute that $1.8m out of their own pocket in the form of foregone salary/benefits and say it's a bootstrapped company with "no outside investment" but in reality it's just the team absorbing that $2m+ of required startup capital.
$1500 cost to the company would be 750 EUR net salary (have deducted the income tax and social and healthcare). At that lower end what you can get is a junior content marketing person, junior inside sales person or someone in customer support and assistance. Probably not anyone in design or engineering. Engineering and design would be starting from $2-2500 for juniors in their 1st/2nd job and of course you can go to thousands from there. Someone working at Skype engineering here would be more like $3-4000 cost to the company.
You must keep in mind though that for $400-500 per month you can rent a luxurious 1-2br apartment and all the services cost also a fracture of what they cost in the US. The spending habits and lifestyle of someone making what seems really low here is much much higher than someone in SF Bay Area.
The argument of what someone would make in the US does not count. Because of the lifestyle and love for your own country most tend to stay in their EU countries. Moving to US and making $120k per year would be a downward spiral for many.
That 1.8m company probably has a headcount of 25-30 people, all world class top notch people, and the company is still hugely profitable and dividend-paying.
For a company that can fully exist in eastern Europe I think this is a highly competitive model. If you can develop and sell SaaS without a U.S. presence whatsoever it changes the economics an order of magnitude exactly as you say.
To the same extent these types of companies succeed the H1B program also becomes less relevant. To your point, coming to the US would be self-defeating since it would change the entire economics of the situation.
I think there are still very large barriers to entry; many industries where you still can't close sales fully remotely and personal networks / connections you miss out when selling to a foreign country. And in case of TFA I think it implies this is finding a US startup so your points are valid and important but perhaps OT.
You can get there with $100k in many cases in 12-18 months if not sooner. Might not be a huge VC business, but still a sustainable growing SME.
We've raised $200k with Weekdone (https://weekdone.com/) but are taking a similar path currently. 5 persons, around break-even, growing month by month. Not really looking at additional investment for now, but might consider someone like Indie.vs if there's a good fit.
A company I know did annual revenues of 0, 50k, 250k, 750k, 1.2m, 1.8m and over 2m this year. Pays good dividends. No outside investment. Some of the financing in early days was generated by custom software dev work. Have seen quite some similar ones around.