Founders aren’t always lying. But they’re not always telling the full story either.

Cheryl Kellond and Andy Walsh unpack the revenue terms that trip up new angel investors, and the specific ways AI companies are stretching numbers in ways that would make an accountant sweat.

The episode starts with a real example: a company doing $40M in gross marketplace value that was actually generating $10M in revenue. Both numbers were true. Neither was wrong. But only one of them tells you what the business is actually worth.

From there, Cheryl breaks down the three revenue patterns that catch angels off guard, marketplace GMV vs. take rate, the two completely different things that “ARR” can mean, and whether a company’s unit economics get better as they grow or just get worse faster.

Then it gets interesting. AI companies are playing a different game entirely. Multi-year contracts where year one is free. Run rates built on a single good day. Revenue that looks like $10M but cost $20M to generate. These aren’t always bad-faith moves, but they are traps for investors who don’t know what to ask.

The bigger point: great founders building real businesses are getting overshadowed by AI headline numbers that don’t hold up to a single follow-up question. Knowing what to ask levels the playing field.

Topics covered:

GMV vs. take rate in marketplace businesses
The two ARRs — and why confusing them costs you
Unit economics: when costs scale with revenue vs. when they don’t
AWS credits are not investment (say it louder)
Multi-year contracts dressed up as ARR
Why honest founders are getting hurt by AI revenue theatrics
Three questions that cover 90% of what angels need to know
Cash vs. accruals and what contracted revenue actually means
Why peer learning makes you a better investor faster

You don’t need to be a CFO to invest well. You just need to know what questions to ask first.

Listen: Apple | Spotify | YouTube

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Andy Walsh - https://www.linkedin.com/in/anwalsh/
2x exited founder and host of Startups Decoded (Top 2% globally). Andy helps founders sharpen judgment and build companies through practical experience and operator insight.

Cheryl Kellond - https://www.linkedin.com/in/c2kprofile/
Founder of Play Money and active angel investor. Cheryl focuses on democratizing angel investing and helping new investors build diversified portfolios while supporting founders with practical guidance and community.

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