ReadWriteStart

JUNE 1, 2020

It is going to cost a lot of money just to get the initial batch of products to test the market and would definitely require external funding. The bridge or exit stage is generally of very large transactions and for companies with substantial valuation. Both of which are expensive and time-consuming. Stages of Funding.

Startup 150

Startup Elevator Pitch Entrepreneur Seed Stage 150

Startup Professionals Musings

MAY 25, 2020

Yet one of the first things a potential equity investor asks about is your exit strategy. Here are three important reasons for the question: Good investment paybacks normally require an exit event. Most experts don’t recommend this approach as your default strategy anymore.

Exit Strategy 376

Exit Strategy Startup Private Equity Equity 376

SoCal CTO

FEBRUARY 17, 2007

They are quite happy with a business that will turn into a profitable $20M company and dont necessarily need an obvious exit strategy. Technology Advisor Technology Roles in Startups Pricing Customer Acquisition Sunk Costs and More -. This is something Ive always wondered about.

Incubator 150

Incubator Technical Cofounder Southern California Los Angeles 150

Startup Professionals Musings

NOVEMBER 4, 2013

They don’t realize that this option would likely be their worst nightmare, since it costs millions for the road show, usually dilutes your equity to a tiny fraction, and takes away all your entrepreneurial control. Their synopsis of the key risks should make you look hard for an alternate exit strategy: Increased risk of liability.

IPO 224

IPO Founder Exit Strategy Investment Bankers 224

Startup Professionals Musings

JULY 5, 2011

They don’t realize that this option would likely be their worst nightmare, since it costs millions for the road show, usually dilutes your equity to a tiny fraction, and takes away all your entrepreneurial control. Their synopsis of the key risks should make you look hard for an alternate exit strategy: Increased risk of liability.

Exit Strategy 235

Exit Strategy IPO Investment Bankers Entrepreneur 235

Startup Professionals Musings

AUGUST 17, 2014

Projecting the financials should be the last step of your business plan preparation, since it assumes you already know the opportunity size, customer buying habits, pricing, costs, and competition. Financial projections for investors should always show an annual cost of goods sold and gross margins line, as well as revenue.

Liquidity Event 249

Liquidity Event Equity Venture Capital Merger 249

Startup Professionals Musings

AUGUST 7, 2016

Despite the fact that the number of IPOs (Initial Public Offerings) for startups have continued to decrease, I still hear it touted often as the preferred exit strategy. You better have lined up a major international expansion, some major acquisition candidates, or a wealth of unfilled orders. Analysts want escalating profits.

IPO 120

IPO Initial Public Offering SEC Stock Options 120

Startup Professionals Musings

MAY 28, 2013

Projecting the financials should be the last step of your business plan preparation, since it assumes you already know the opportunity size, customer buying habits, pricing, costs, and competition. Financial projections for investors should always show an annual cost of goods sold and gross margins line, as well as revenue.

Liquidity Event 243

Liquidity Event Startup Equity Venture Capital 243

Up and Running

JULY 2, 2014

You can’t underestimate the importance of selecting an attorney who “gets” your business model, your market opportunity, and most importantly, your fundraising and exit strategy. Do they have experience with mergers and acquisitions, including how to set up the company for successful exit scenarios?

Technical Review 118

Technical Review Angel Investor Dilution Due Diligence 118

Startup Professionals Musings

JANUARY 16, 2011

It has been at least a decade since going public via an Initial Public Offering (IPO) has been considered a credible exit strategy for startups. Do you need the IPO for your acquisitions strategy? Of course, you’re going to have to perform well to make that stock useful in the acquisitions process.

IPO 223

IPO Social Media Media Exit Strategy 223

Startup Professionals Musings

JUNE 26, 2020

For example, “We just patented a new battery technology that will cut your smartphone charge time and cost in half.” If possible, quantify these in non-technical business terms, such as dollars saved or replacement costs over time. Outline a viable exit strategy for you and investors.

Business Plan 423

Business Plan Product Intellectual Property Elevator Pitch 423

Gust

AUGUST 10, 2014

Projecting the financials should be the last step of your business plan preparation, since it assumes you already know the opportunity size, customer buying habits, pricing, costs, and competition. Financial projections for investors should always show an annual cost of goods sold and gross margins line, as well as revenue.

Liquidity Event 176

Liquidity Event Equity Venture Capital Exit Strategy 176

Startup Professionals Musings

DECEMBER 11, 2015

Investors invest in people who take action rather than find the excuses that patents are not defensible, cost money or may be done later. Investors are looking for significant (20 percent or greater) cost reductions, training savings or expense reductions. Solidify your exit strategy by picking a competitor as a comparable.

Intellectual Property 120

Intellectual Property Liquidity Event Exit Strategy Angel Investor 120

Startup Professionals Musings

JULY 3, 2015

As an advisor and mentor to startups, I try to make sure entrepreneurs understand both the pros and cons of an IPO as an exit strategy. When including lawyers and a chief compliance officer, many experts argue that the costs can quadruple those of a private company. All strategy and operational moves become public.

IPO 120

IPO Initial Public Offering Entrepreneur Private Equity 120

Startup Professionals Musings

FEBRUARY 13, 2016

The business model has to clearly define who is your customer, market penetration expected, how much customers pay versus total costs and the investment required to sustain cash flow. Technically, this is your exit strategy, usually a merger and acquisition (M&A) or initial public stock offering (IPO).

Sweat Equity 120

Sweat Equity Advisory Board Liquidity Event Startup 120

Startup Professionals Musings

SEPTEMBER 12, 2014

Yet one of the first things a potential equity investor asks about is your exit strategy. Here are three important reasons for the question: Good investment paybacks normally require an exit event. Most experts don’t recommend this approach as your default strategy anymore.

Exit Strategy 289

Exit Strategy Entrepreneur IPO Startup 289

Startup Professionals Musings

AUGUST 7, 2015

Every customer understands that your solution has to generate more revenue than cost, but you should not put that data in a customer pitch. Investors are also interested in future investment requirements, time frames and long-term strategy. Potential investor return calculation and exit strategy.

Product 120

Product Intellectual Property Liquidity Event Burn Rate 120

www.inc.com

SEPTEMBER 24, 2011

Pricing Strategy. Exit Strategies. Strategy and Planning. But with the help of Grahams company, which specializes in creating tech systems for start-ups, Jumpstart grew to more than $50 million in revenue--enough to make it an attractive acquisition for media conglomerate Hachette Filipacchi. Office and Operations.

Arizona 40

Arizona Equity Iowa Venture Capital 40

Startup Professionals Musings

JUNE 2, 2013

The single most important ingredient of success is not the idea, but having a team in place that has impeccable integrity, can iterate the product quickly, pivot the business model as necessary, and keep costs down in the process. This requires a visible focus on the company’s revenue model, the costs to get there, and cash on hand.

Cram Down 269

Cram Down Angel Investor Intellectual Property Venture Capital 269

YoungUpstarts

MAY 7, 2015

The company just needs to be large enough to generate a profit to substantiate the annual costs of maintaining the ESOP. In profitable S-corporation ESOP companies, the tax savings should be more than enough to offset such annual costs. Many ESOPs are as small as 12-15 employees with less than $1 MM in annual revenue.

Stock 100

Stock Employee Private Equity Valuation 100

Startup Professionals Musings

APRIL 27, 2016

Yet one of the first things a potential equity investor asks about is your exit strategy. Here are three important reasons for the question: Good investment paybacks normally require an exit event. Most experts don’t recommend this approach as your default strategy anymore.

Equity 120

Equity Exit Strategy Private Equity Startup 120

Mike Michalowicz

JANUARY 8, 2015

Some purchases are strategic acquisitions – your office cleaning company (with its client list and equipment) is attractive to a home cleaning business looking to expand. Other purchases are simply to generate revenue – allowing the buyer to streamline processes and cut costs by consolidating. Find out what your buyer wants.

Intellectual Property 60

Intellectual Property Investment Bankers Exit Strategy Sales 60

Gust

DECEMBER 23, 2011

Similarly, start calling VCs if your customer acquisition costs can only be recaptured over a substantial period of time. Get those pitchbooks ready if your idea is not genuinely defensible except by being the first kid in the pool and creating a network effect, or dominant brand, before others do.

Intellectual Property 127

Intellectual Property Balance Sheet Dilution Bootstrapping 127

Startup Professionals Musings

MARCH 13, 2020

Even if you work harder than everyone else, you probably won’t stay ahead of rising costs and new competitors. > Define an exit strategy for investors to liquidate their share. > Market penetration and revenue targets related to opportunity size. Back up your projections with a simple financial model.

Liquidity Event 308

Liquidity Event Forecast Exit Strategy IPO 308

Up and Running

OCTOBER 3, 2018

Financial Summary: Explain your business model, startup costs, revenues, and liabilities to the company. The solution: PARE shoulders the cost of renovations for young people who do not have the time, knowledge, or money to do it themselves. Your funding ask and exit strategy, if applicable. Be specific. Financial plan.

El Paso 61

El Paso Business Plan Technical Review Forecast 61

Up and Running

NOVEMBER 12, 2018

With the total cost of each box in hand, calculate a price with at least a 40 percent profit margin, as suggested by CrateJoy. For example, the men’s hair product box might cost $39.95 per month, but if you commit to subscribing for a year, its monthly cost will drop to $36.95. Startup costs. Fulfillment. Milestones.

Business Plan 63

Business Plan Curation Balance Sheet Intellectual Property 63

Entrepreneurs-Journey.com by Yaro Starak

MARCH 10, 2011

This article picks up from that point onward, discussing the challenges we ran into once we went into operation mode, the invaluable lessons that only first-hand experience can teach, the exit strategy which was the $250,000 sale of the website, and finally my overall concluding thoughts on the entire experience. This was a huge risk.

Technical Review 71

Technical Review PPC Due Diligence Exit Strategy 71

Up and Running

AUGUST 19, 2014

what’s behind your financials, your go-to-market strategy, your current traction in the marketplace, your competition and why you’re better, your intellectual property or “secret sauce,” your exit strategy, etc.). Keep your strategy, tactics, numbers, and stories in alignment. Tweet This Tip.

Angel Investor 161

Angel Investor Technical Review Due Diligence Startup 161

Entrepreneurs-Journey.com by Yaro Starak

FEBRUARY 11, 2011

In this post, I want to lay out the details involved in how I first realized the opportunity, the formation of the business idea, the search for my supplier, the establishment and growth of the business, problems encountered and lessons learned, as well as the exit strategy that resulted in the $250,000 sale of the business.

SEO 86

SEO PPC America Search 86

David Teten

DECEMBER 3, 2019

Some notable metrics are revenue growth rates, free cashflow, leverage ratios, historical financing amounts, returns on marketing spend, customer acquisition costs, lifetime value of customers, customer churn rates, and team social scores. Capital has built a free online tool for founders to calculate their cost of capital.

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

Up and Running

MARCH 11, 2015

That moves into the customer acquisition strategy. This includes again another acronym I’m going to share, CAC, the cost to acquire a customer, the customer acquisition cost. You want to make sure that you understand, does it cost $10 to get a customer? I don’t know what it’s going to cost.

Technical Review 60

Technical Review Software Review Due Diligence Exit Strategy 60

Up and Running

MAY 22, 2018

An MVP or a minimum viable product is a scaled-down, cheaper (cost-wise) version of your full product. Total cost that is involved in gaining a paying customer. This means before they bought your product, how much direct or indirect cost did you incur? This includes the commissions, advertising costs, trial periods, and so on.

Exit Strategy 90

Exit Strategy Angel Investor Search Elevator Pitch 90

The Next Web

MAY 26, 2013

Provide customer acquisition costs. Investors want to know how much it costs you to gain a customer. Ideally, you can provide this cost per marketing channel. For example, you could say, “It costs us $5 per customer through ads, but $2 per customer through affiliate networks.” Find a real audience.

Software 151

Software Forecast Startup Exit Strategy 151

Entrepreneurs-Journey.com by Yaro Starak

JUNE 19, 2010

The difference here is the entry-level cost to buying web property, not physical property, is much lower than what it is to buy real-world properties. If you decide to follow a blog acquisition strategy, you’re not going to write the blog yourself, not very likely. I like to write, but not that much. Buy sites in your market.

Technical Review 76

Technical Review Software Review Prospectus Audience 76

www.paulgraham.com

APRIL 28, 2010

With angels were now talking about venture fundingproper, so its time to introduce the concept of exit strategy.Younger would-be founders are often surprised that investors expectthem either to sell the company or go public. Theyll only considercompanies that have an exit strategy—meaning companies that couldget bought or go public.

Technical Review 76

Technical Review Startup Software Review Vesting 76

Entrepreneurs-Journey.com by Yaro Starak

JANUARY 21, 2011

Right out of Graduate School, I started my career with one of the big four accounting firms in their M&A (Mergers and Acquisitions) practice. I believe in maxing out tax advantageous vehicles like the 401(k) and Roth IRA, and dollar cost investing over time in no to low load mutual funds, including index funds. Same as above.

Internet 80

Internet Technical Review Stock Due Diligence 80

A Smart Bear: Startups and Marketing for Geeks

JUNE 20, 2011

That’s where acquisition comes in — if you can’t make it, buy it! So it’s not a cut-and-dry decision, but it’s clear how your company will be valued primarily: The cost of acquisition + re-culturing versus the cost of build-from-scratch. Applying this to selling your company.

Sales 260

Sales Channel Cofounder Valuation 260