I'm not a VC, so take what I say with a grain of salt, but while the numbers look a bit high to me, they are probably in the ball park for SF VCs. I use to work with startups in the Ottawa Canada area about 15 years ago. Even at that time, they might give you $1-10 million in seed money, with %20 ownership, expecting a 20:1 exit. So they'll want $20-200 million back, which means your valuation has to be in the $100 million to $1 billion range. If you're not showing how to have $10's of millions in sales in the next 5 years, they have absolutely no interest in you. (Well, in those days, the main exit was a buyout from the big guys, so having an "industry disrupting" demo was the other thing to do and was much cheaper to build).

These days, if you are looking to build a "niche" business with $10 million a year in sales, I think you'll have absolutely no competition from VCs. If you're looking at $100 million a year in sales, I think you'll butt up against the "failed" VC funded companies. And larger than that, I suspect you'll be getting quite a lot of competition.

There are definitely angels who will fund smaller projects, but I think you still have to show an open ended potential. For example, I worked with one startup that had only $100K seed money and was looking for a quick $3-5 million exit. I've never actually seen any of these be successful, because $100K represents only a year of development costs, so companies usually reimplement good ideas in house.

Again, I'm not an expert in this area, but I have always thought that bootstrapping a sustainable business has been hugely undervalued for the last 20 years or so. Everybody is so focused on putting hundreds of millions in their pockets that they turn their noses up at mere millions. Lots of opportunity in this space.

Those numbers ring true for expectations of medium-to-large ($250 M+ is probably a good threshold) SF Bay Area VCs, at this moment in early 2017.

Source: small-to-medium non-SF VC.