Startup Professionals Musings

MARCH 25, 2023

Should they focus on increasing revenues and profitability, or entice more and more users with “free” services, to increase their valuation. The concept of free goods and services to get you hooked, financed by deep pockets, or advertising, seems marginally ethical to many. Most are still confused about the right priority.

Valuation 235

Valuation Revenue Viral Retention 235

YoungUpstarts

JULY 10, 2017

A change in revenue recognition means a change in the due diligence process, specifically accounting diligence, modeling, quality of earnings and cost of integration. Effects on valuation. The new standard will affect revenue multiples, margin analysis and overall cost of integration of the target company. What are the changes?

Technical Review 124

Technical Review Revenue Software Review Due Diligence 124

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. If you are facing any problem you can always check out this: Business Loan vs. Equity Financing. Both of which are expensive and time-consuming. Stages of Equity-based funding. ?

Startup 150

Startup Entrepreneur Elevator Pitch Seed Stage 150

Both Sides of the Table

FEBRUARY 27, 2019

Very few people turn up with a strong sense of “what we should be doing” or ready to lean into a productive conversation The financials were prepared by the VP of Finance / CFO. The law firm has done its job of preparing the stock option requests, board meeting minutes, 409a valuations. There are too many pages. The meeting starts.

Stock Options 226

Stock Options Metrics Stock Valuation 226

Steve Blank

APRIL 1, 2020

Any place with a fixed cost that relies on foot traffic will come under pressure. Cut costs to stay alive for 24 months. Payroll costs/other variable costs. Others are cutting their valuations. How can you shift focus to customer retention versus acquisition? How many months of cash do you have?

South Korea 333

South Korea Salary Business Model China 333

Steve Blank

AUGUST 19, 2013

Yet during those same 60 years, rather than decreasing, the cost of getting a new drug approved by the FDA has increased 80 fold. Yep, it cost 80 times more to get a successful drug developed and approved today than it did 60 years ago. Pharma companies are staggering under the costs. And medical device innovation in the U.S.

Venture Capital 302

Venture Capital Startup Lean Philadelphia 302

Startup Professionals Musings

JUNE 21, 2020

Should they focus on increasing revenues and profitability, or entice more and more users with “free” services, to increase their valuation. The concept of free goods and services to get you hooked, financed by deep pockets, or advertising, seems marginally ethical to many. Most are still confused about the right priority.

Revenue 434

Revenue Valuation Viral Retention 434

Both Sides of the Table

MARCH 1, 2011

Quigo Lands Overture as Client, Rejects Their Acquisition Offer. Mike believed that any valuable page was going to be monetizable on a cost-per-click basis in relation to every page on the Internet. Lesson Learned From Rejecting Acquisition Offers. Rejecting a bona fide acquisition offer was an incredible learning experience.

Semantic 302

Semantic Acquisition Valuation Angel Investor 302

Tim Keane

MARCH 9, 2011

How should I finance my new venture? It’s a deceptively simple question:  what is the optimal way to finance a new startup? The overarching idea, of course, is to reduce the cost of capital while maintaining appropriate flexibility for the venture.  2]   Aligning interests in structure: cost and risk.

Finance 83

Finance Bootstrapping Startup Equity 83

Steve Blank

OCTOBER 24, 2017

Facebook’s ~$20 billion acquisition of WhatsApp, a 5-year-old startup that had $10 million in revenue, made no sense until you realized that Facebook was paying to acquire 300 million new users.). A 20th century VC was likely to have an MBA or finance background. 2. Information is everywhere. The founders.

Founder 252

Founder Technical Review CTO Hire IPO 252

Startup Professionals Musings

OCTOBER 19, 2015

That’s why I recommend that they find a co-founder who loves business challenges, including marketing and finance. The best technologies are barely invisible and low cost. The right marketing efforts can cost as much as the technology. Most technologists have little interest in the mechanics of starting and building a business.

Technical Review 120

Technical Review Intellectual Property Cofounder Bootstrapping 120

A Smart Bear: Startups and Marketing for Geeks

JUNE 20, 2011

Or a company like Zappos (who was famous, growing, and profitable) still got only a 1x sales valuation when bought by Amazon because of thin margins. There’s many possibilities, each of which will cause a different valuation of your company. That’s where acquisition comes in — if you can’t make it, buy it!

Sales 260

Sales Channel Cofounder Valuation 260

ReadWriteStart

JULY 17, 2023

The acquisition will help Sheela Foam enter the fast-growing branded furniture market and expand its presence in the furniture industry. The platform has raised over $225 million through equity and debt financing to date. With this acquisition, Sheela Foam will be able to offer a wider range of products and services to its customers.

India 104

India Acquisition Merger Curation 104

David Teten

JANUARY 19, 2021

The value ascribed by subsequent investors (in a secondary); buyers (acquisition); or the public markets (IPO). Yes, via conversion rights at a valuation cap. Yes, via conversion rights at a valuation cap. That said, nothing is cost-free. More complex cost of capital calculation. Yes, typically preferred equity.

Cofounder 78

Cofounder Technical Review Equity Dividend 78

Steve Blank

FEBRUARY 26, 2020

Btw, the definition of each startup financing stage has changed in the last decade. At the end of this post, we’ll discuss the valuation at each step (how much the investors value your company and therefore how much of it you need to give up to get this money) and how much revenue you should generate at each step.).

Cofounder 429

Cofounder Seed Stage Valuation Metrics 429

Both Sides of the Table

JULY 29, 2010

We received so much positive feedback from our This Week in Venture Capital show walking through valuation calculations & term sheets that we decided to do a Q&A show this week to address topics that entrepreneurs want to learn about. The best thing to get is a “right sized&# valuation. A: It’s not best.

Venture Capital 282

Venture Capital Term Sheet Valuation Stock Options 282

The Next Web

OCTOBER 7, 2013

Layer on the opportunity cost of choosing not to pursue lucrative alternatives offered elsewhere, and it’s easy to see how, if not under the right terms, the engineer #1 position is less than appealing. As stated earlier, investors will dilute ownership upon nearly every round of financing. Are they especially acquisitive?

Engineer 129

Engineer Dilution Option Pool Vesting 129

YoungUpstarts

JUNE 20, 2016

This required high operational costs like round the clock staff, abundant paper supplies and couriers. The switch from PDRs to VDRs resulted in deal cycles and increased valuations. Some of these benefits include the following: Reduced cost of operations. Mergers and Acquisitions. percent between 2009 and 2014.

Software Review 100

Software Review Technical Review Due Diligence Security 100

Up and Running

DECEMBER 9, 2014

Bates: Good morning and welcome to our CEO panel, “How to Fine-Tune Your Small Business Finances From Funding to Growth” which I think is the direction that we would all like to be going. I’m here with some really phenomenal CEOs who are going to talk to us today about small business finances from funding to growth.

Small Business 95

Small Business Finance Forecast Metrics 95

Both Sides of the Table

MAY 23, 2012

Cloud computing and the open source movements have brought down the costs of starting a company by more than 90%. They need a combination of capital and experience to separate from the rest of the pack – the low cost of starting a business means it is even more vital to become the market leader more quickly. The Exit Problem.

Venture Capital 347

Venture Capital Technical Review LP Mobile 347

The Startup Magazine

SEPTEMBER 10, 2019

Asset valuation. The concept of asset valuation may seem counterintuitive, but it is an important idea. Compared to Accounting, Finance is ruthlessly forward looking. Most financial valuation formulas value an asset by discounting the asset using the cost of capital (interest rate) to the present day.

Founder 117

Founder Valuation Dividend Startup 117

Duct Tape Marketing

FEBRUARY 3, 2022

Since 2015, her company, Barney, has guided over 150 media, marketing & tech companies through acquisitions. 10:25] Are you seeing anybody selling parts of their companies rather than an entire acquisition? [11:19] All those things go into, you know, setting what that, that valuation is outside of just the financials.

Entrepreneur 80

Entrepreneur Technical Review Cofounder Valuation 80

Cracking the Code

FEBRUARY 23, 2011

The sales productivity ratio (measured with the Customer Acquisition Cost or CAC ratio) are also fairly similar for the two groups (except for a small cap dip in Q4 09) and therefore do not explain the difference Why is scale so much rewarded by public markets? Detailed SaaS Spreadsheet (Valuation and CAC benchmark).

Software Review 101

Software Review Technical Review Valuation Europe 101

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

AUGUST 29, 2014

Many people who want to start a business believe they will be able to get grants or loans to help them finance the venture. A major cause of business failure is not having enough cash available to cover all startup costs and operate for at least a year. Ask what the firm’s specialties are (tax, audit, business valuation, etc.).

Small Business 87

Small Business CPA Government North America 87

Berkonomics

FEBRUARY 9, 2023

The rest of the purchase price was concocted from a brew of zero-coupon bonds (where the face value is many times the invested amount until the reduced cost bonds mature thirty years later), and borrowing using the target company’s accounts receivable and other assets as collateral for a loan to purchase the company.

Naming 62

Naming Warrant Private Equity Valuation 62

Both Sides of the Table

APRIL 14, 2012

What I want to talk about today is one of the insider baseball discussions of our industry this past week: The odd fact of the $500 million financing round completed just before the company sold for a B. Did raising money at a $500 million valuation help secure the $1 billion deal? “Impending” valuation.

Valuation 316

Valuation Balance Sheet Dilution Term Sheet 316

VC Adventure

APRIL 2, 2020

Everyone is being cautious about valuations. Anecdotally I’ve heard that early stage valuations are already down 30-50%. Marketing expenses are lower and customer acquisition costs typically are reduced. Funds will smaller portfolios are more likely to be looking at new deals.

Valuation 118

Valuation Portfolio Database Early Stage 118

Growthink Blog

APRIL 15, 2015

Now given that the company has yet to even come close to breaking even, this can be viewed as either a great validation of Domo''s business model, or as more evidence of the “Bubble Mania” of the current technology financing landscape and a screaming signal to get out while you still can.

Valuation 48

Valuation Venture Capital Finance Acquisition 48

The Startup Magazine

APRIL 24, 2020

Whether you’re interested in selling a website you built from scratch, or want to sell your Amazon-based B2C brand, there are many different baseline factors that go into determining an appropriate website valuation number. While it’s true that valuations can get quite technical, the basics are relatively easy to understand.

eCommerce 91

eCommerce Valuation B2C Revenue 91

Startup Professionals Musings

JUNE 26, 2016

Should they focus on increasing revenues and profitability, or entice more and more users with “free” services, to increase their valuation. It’s only been in the last ten years that social media companies, like Facebook and Twitter, have achieved market valuations in billions of dollars, while clearly sacrificing revenue to gain users.

Revenue 145

Revenue Valuation Startup Viral 145

Startup Professionals Musings

AUGUST 10, 2014

Should they focus on increasing revenues and profitability, or entice more and more users with free services to increase their valuation. The concept of free goods and services to get you hooked, financed by deep pockets or advertising, seems marginally ethical to many. Most are still confused about the right priority.

Revenue 246

Revenue Entrepreneur Valuation Viral 246

www.inc.com

SEPTEMBER 24, 2011

Finance | Tuesdays. Financing a Small Business. Financing A Small Business. Personal Finance. Theres a huge opportunity cost in not taking equity," he says. In the past few years, hundreds of small companies have been snatched up by private equity firms willing to agree to ever-rising valuations. Franchises.

Arizona 40

Arizona Equity Iowa Venture Capital 40

Cracking the Code

MARCH 12, 2010

The SaaS growth recovery does not seem to take a "V" shape 2) Sales productivity is ramping up: bottom was hit in the first half of 2009 However, the sales and productivity of the group, measured by the median "Customer Acquisition Cost ratio" or "CAC ratio", seems to be recovering more steeply. Finance Dissertation Help.

Software Review 63

Software Review Technical Review Cloud Forecast 63

abovethecrowd.com

JUNE 2, 2021

According to an interview with Elon Musk, this campaign cost Paypal about $60 million , which most Silicon Valley historians would consider money well spent. It would cost a tremendous amount of money to run such a program. With the 7% banker fee that is a 35% AVERAGE cost of capital. Billions of dollars. Wouldn’t that be great?

IPO 82

IPO Customer Matching Silicon Valley 82

Up and Running

NOVEMBER 12, 2014

If your business needs financing, consider equity crowdfunding; its distinctive traits will lure investors desiring the rewards of investment returns and investor protection, in addition to the goodwill generated by their support. Cover Upfront Costs. Evaluate the administrative and financial costs of running the campaign.

Equity 125

Equity SEC Technical Review Security 125

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. Pricing : Design your pricing so that will cover your costs and match the market rate.

El Paso 61

El Paso Business Plan Technical Review Forecast 61