Should I persevere? The business plan my VC funded didn’t work out …

Could you not stay, use revenues over time to buy back the equity from the VC and do very well for yourself?

You own 20% of your market? With 200k in revenue, are you sure its just 1m total?

If your burn is 4K/month, WHY are you not taking a salary since it looks like your company is cashflow positive. Or are you saying you're still losing 4K/month i.e. your expenses exceed 200K/year.

I think you feel temporarily confused, but you can go ahead. Take a little time to think about it differently. You have a product. You have customers. You have revenue. You have a pipeline. You have a funding partner. You have growth. This is perfectly fine. You have doubts because you thought it should have been easier and faster to get there. But this is fine. All your current problems can be solved, and you have to think about it.

Long sales cycle: you can work on your sales techniques to shorten it. Or you can work on your pricing and offering to get more revenue from each single customer

Low price: long sales cycle is easier to manage when product price is high and when you can make repeat business with existing customers. Work on you product, or new products you could easily sell to the same customers.

Product: over time, your product will improve. Improvement will allow you to increase price, reduce sales cycle, and produce repeat business.

Business model: you may sell your product differently (SaaS, Freemium...) or through other channels. Be imaginative.

You have a startup. Not a corporate machine executing a precise plan. What you told us in your message is expected results for your current plan if nothing changes. Continue improving your offer and your plans and you can certainly increase your growth rate. I'm not talking about pivot. Keep the same direction and enlarge your route to run faster.

I agree with the previous comment: you have probably heard a thousand times that it would be hard, but hearing it and experiencing it are two different things. Now it seems to me you are on the right track, and certainly better off than 90% of entrepreneurs who never got even generate revenues.

Think also of the alternative: are you willing to go back to work for somebody else, for a salary, and no chance to ever make it big?

Why don't you give us the domain and we can crowd source the solution

The numbers offhand don't seem like they justify even continuing as a lifestyle business - unless you consider low pay a lifestyle.

A simple metric would be: Can you and your team collect a satisfactory wage and still be able to accumulate enough cash to pay off the outstanding debt in 2 years?

If not, best to wrap up sooner rather than later as opportunity costs are very significant.