Is Startup Funding only based on Unrealistic Projections?

So I came across this article recently:

https://inc42.com/buzz/the-moms-co-fy23-net-loss-jumps-60-to-inr-64-cr-revenue-grows-38/amp/

Now according to this, The Moms Co was aiming for a 500cr revenue run rate in FY23 while they have only been able to do 71 cr and that too at a decent loss of around 65cr.

The founders reportedly filed default notices against the Good Glam Group for not making the final payments due to them.

It really makes me wonder though, the company did 51cr in revenue in FY22 so how were they able to show such unrealistic future projections of revenue and get their Exit which apparently is the largest exit in the D2C space according to the founders? Would love to hear the community's thoughts on this as well as any other case since this is quite common these days.