You would not know who Carlo Pietro Giovanni Guglielmo Tebaldo is unless you found out his last name. Yeah! Even I did not know Italians took on such long names.

Startups typically raise seed/angel money for early-stage capital. If the company grows from that point, it can approach institutional investors and raise money from them. The series represents the number of times the company has raised capital from investors. Series A is the first time, Series B the second time, and so on.

Typically, an Angel investor exits the startups (sells their shares for cash) in a Series B round. Institutional investors can also exit in later rounds or stay with the company if they see growth potential. 

It is a given that startups will not generate cash profits and buy these investors out, and their exit depends on another investor coming and buying them out. Hopefully, they can turn profitable at some scale and make a public offer. Once public, the company goes from being the problem of a few to a problem of many.

In 1919, Carlo Pietro Giovanni Guglielmo Tebaldo, known as Charles in America - came up with a scheme where he took money from investors to invest in International Reply Coupon and profit off the exchange arbitrage. He had not run his numbers well enough. He made some money initially, but since the returns he promised were really high, he needed to bring in bigger investors to keep up with his payments. At some point, he was not even trying anymore and was only focused on bringing in more and more investors. Eventually, he was found out.

His last name was Ponzi.

Every startup is a Ponzi scheme until it is not. Nobody knows where it will end. They just keep bringing in larger and larger investors hoping that at some scale the company will turn profitable. Given that 9/10 startups fail, they often do not even reach scale, let alone profitability.

The difference between Charles Ponzi and the startup would be that he stopped trying to generate a return altogether.

The problem is not if your plan fails; it is if you do not even try to make it succeed.