YoungUpstarts

OCTOBER 24, 2013

One of the challenges for investing in startups has always been the lack of an established way for founders and investors to actually measure and decide on the valuation of the startup concerned. “If you are an angel investor and a venture is seeking capital from you, insist on getting its Worthworm report.

Pre-Money Valuation 150

Pre-Money Valuation Web Technical Review Angel Investor 150

Up and Running

JULY 2, 2014

We developed a kick-ass investor pitch and we started pitching it to family, friends, angel investors, and even venture capitalists for feedback. We soon got interest from an angel investor, and he wanted to invest $300,000 in our startup. What we’d signed was an agreement that the investor could keep his 33.3%

Technical Review 118

Technical Review Angel Investor Due Diligence Dilution 118

Startup Professionals Musings

AUGUST 31, 2018

Most of you new venture founders I meet as an angel investor seem convinced that starting the business is the hardest part. Totally new and risky products will dilute your focus, and may confuse existing customers. Expand your product line, staying close to the core.

Angel Investor 167

Angel Investor Dilution Software Review Distribution 167

Startup Professionals Musings

FEBRUARY 27, 2023

Every startup needs to start their funding search looking for grants, with no equity dilution, as well as contests and foundations. These often lead to angel investors and venture capital investments later, or connections to local company venture funds for selected focus and technology areas.

Arizona 276

Arizona Intellectual Property Accredited Investor Entrepreneur 276

Both Sides of the Table

OCTOBER 12, 2014

This is important for nearly every institutional investor because once you have 25-50 investments being able to “follow” the investments that are working well is critical to making money. This might happen because to meet all investors needs they end up selling too much of the company, taking too much dilution and feeling beat up.

Technical Review 336

Technical Review Later Stage Early Stage LP 336

Startup Professionals Musings

DECEMBER 11, 2022

After many years of working with angel investors seriously trying to find new ventures worthy of their hard-earned money, I find their frustration often exceeds that of entrepreneurs sincerely looking for financial help. Investors invest in people, often more so than in the product. Dysfunctional or non-functional team members.

Due Diligence 271

Due Diligence Intellectual Property Entrepreneur Preferred Stock 271

ReadWriteStart

JUNE 1, 2020

Equity investors. The third source of funding is from equity investors. Under this category, you have the angel investors who would invest their own money and Venture Capital or VC firms, who manage funds aimed towards specific startup sectors and stages. Now here are some of the things that investors won’t tell you.

Startup 150

Startup Entrepreneur Elevator Pitch Seed Stage 150

Berkonomics

FEBRUARY 8, 2024

After friends and family… Once a company founder has tapped the funds available from his or her resources and from friends and family, if the company needs more cash for growth, the most obvious next step is to look for money from angel investors and venture capitalists, typically in the $300,000 TO $3,000,000 range.

Cost 62

Cost Covenant Angel Groups Angel Investor 62

Startup Professionals Musings

MAY 30, 2020

Every startup needs to start their funding search looking for grants, with no equity dilution, as well as contests and foundations. These often lead to angel investors and venture capital investments later, or connections to local company venture funds for selected focus and technology areas.

Arizona 310

Arizona Intellectual Property Accredited Investor Dividend 310

Both Sides of the Table

SEPTEMBER 25, 2010

Paul Graham’s assertion that “any startup founder can tell you the most common question they hear from investors is not about the founders or the product, but “who else is investing?&# Investors who commit early deserve to have a lower price. But that’s what great angels do.

Finance 286

Finance Term Sheet Technical Review Warrant 286

Startup Professionals Musings

JULY 19, 2013

Most entrepreneurs struggle with many startup Founders dilemmas in building their business, and these key dilemmas are probably the biggest source of pain and failure for the entrepreneur lifestyle. Should you start a company solo or find co-Founders to help you? The downside is loss of control and financial dilution.

Founder 245

Founder Hockey Stick Cofounder Liquidity Event 245

Berkonomics

AUGUST 10, 2023

Investor-friendly clauses in agreement There are also clauses in many such investor documents that allow the investor to override the founder and force a sale of the company if a proposed sale is attractive to an investor for liquidity, even if the founder feels that there is much more potential if the business is not sold at the present time.

Liquidity Event 116

Liquidity Event Initial Public Offering Dividend Valuation 116

A Smart Bear: Startups and Marketing for Geeks

FEBRUARY 26, 2019

Founders almost never have a real strategy. Founders explain failures with things like “our two main competitors did [thing] to us” or “customers didn’t understand [our point of view].” The 10,000th biggest company in the world is a very successful company, as is the two-person company where the founders each take home $300k/year.

Restful 202

Restful Founder Revenue Acquisition 202

Startup Professionals Musings

MARCH 14, 2020

After many years of working with angel investors seriously trying to find new ventures worthy of their hard-earned money, I find their frustration often exceeds that of entrepreneurs sincerely looking for financial help. Investors invest in people, often more so than in the product. Dysfunctional or non-functional team members.

Due Diligence 308

Due Diligence Intellectual Property Preferred Stock Seed Stage 308

VC Cafe

SEPTEMBER 28, 2023

The Carta data showed the following trends: About half of the companies that closed had not raised any venture capital, relying solely on bootstrapping, angel investors, or other sources. For those that did tap VCs, 90% were either Seed or Series A stage companies. It comes with the territory.

Valuation 103

Valuation Startup Angel Investor Dilution 103

Startup Professionals Musings

AUGUST 10, 2019

Most entrepreneurs struggle with many startup founders quandaries in building their business, and these key dilemmas are probably the biggest source of pain and failure for the entrepreneur lifestyle. Should you start a company solo or find co-founders to help you? The downside is loss of control and financial dilution.

Hockey Stick 243

Hockey Stick Cofounder Liquidity Event Startup 243

Genuine VC

JULY 19, 2010

Micro VCs will continue to come in many flavors with slightly different strategies, but there are a few distinctive defining characteristics: On a per partner basis, each investor is investing less than $25M in any given fund. Initial investment in a company is among the first non-founder capital raised.

Seed Stage 175

Seed Stage Technical Review Dilution Offshore 175

Austin Startup

FEBRUARY 13, 2019

But every startup’s journey towards getting to the Series A point is certainly unique in its own way, and when I reflect on what it took to reach this goal, there were four key strategies, related to raising funds and seeking out investors, that really set us up for successes and helped us get there not just faster, but smarter.

Strategic Investors 49

Strategic Investors Austin Angel Investor Bootstrapping 49

Startup Professionals Musings

JANUARY 27, 2012

Entrepreneurs sometimes assume an initial agreement with an Angel is a commitment, so they start spending before any money is received. It’s true that Angel investors typically do not present entrepreneurs with overly complicated deal structures, especially when compared to venture capitalists. Anti-dilution protection.

Term Sheet 223

Term Sheet Pre-Money Valuation Due Diligence Post-Money Valuation 223

Startup Professionals Musings

DECEMBER 14, 2014

Most entrepreneurs struggle with many startup Founders dilemmas in building their business, and these key dilemmas are probably the biggest source of pain and failure for the entrepreneur lifestyle. Should you start a company solo or find co-Founders to help you? The downside is loss of control and financial dilution.

Hockey Stick 268

Hockey Stick Cofounder Entrepreneur Liquidity Event 268

Startup Professionals Musings

AUGUST 19, 2017

Most entrepreneurs struggle with many startup founders dilemmas in building their business, and these key dilemmas are probably the biggest source of pain and failure for the entrepreneur lifestyle. Should you start a company solo or find co-founders to help you? The downside is loss of control and financial dilution.

Hockey Stick 144

Hockey Stick Cofounder Entrepreneur Liquidity Event 144

Startup Professionals Musings

SEPTEMBER 14, 2010

Entrepreneurs sometimes assume an initial agreement with an angel is a commitment, so they start spending before any money is received. It’s true that angel investors typically do not present entrepreneurs with overly complicated deal structures, especially when compared to venture capitalists. Anti-dilution protection.

Term Sheet 227

Term Sheet Pre-Money Valuation Due Diligence Post-Money Valuation 227

Berkonomics

DECEMBER 21, 2017

Once a company founder has tapped the funds available from his or her resources and from friends and family, if the company needs more cash for growth, the most obvious next step is to look for money from angel investors and venture capitalists, typically in the $300,000 TO $3,000,000 range.

Covenant 97

Covenant Cost Angel Groups Angel Investor 97

Startup Professionals Musings

FEBRUARY 9, 2018

Among many other insights, he offers a perspective on several myths of entrepreneurship, which I can now paraphrase and prioritize based on my own experience: A real startup needs investors to get off the ground. In fact, research by Fundable shows that less than one percent of all startups are funded by venture capital and angel investors.

Incubator 180

Incubator Angel Investor Dilution Equity 180

The Next Web

OCTOBER 21, 2013

Neil Rimer is a Partner and co-founder of Index Ventures. As the European startup ecosystem matures, you would expect young entrepreneurs to enjoy ever-increasing access to useful advice from mentors, business leaders, experienced entrepreneurs, legal advisors and investors.

Cap Table 128

Cap Table Option Pool Angel Investor Entrepreneur 128

Both Sides of the Table

JULY 16, 2013

Because at least while the VC spigot is open and flowing for high-potential individuals that fit a pattern that some VCs seem to favor they can access cheap capital that isn’t terribly dilutive and can use the to fund development and swing for the fences with limited focus on monetization. And the dilution that goes with it.

Burn Rate 412

Burn Rate Dilution Revenue Valuation 412

VC Cafe

FEBRUARY 27, 2024

A founder asked me what makes a $2M round “pre-seed”? What’s the difference between an angel round and pre-seed round and why do I believe we’ll see more pre-seed rounds taking place in 2024? especially if the startup already has a product and revenue? who’s talking to customers?)

Valuation 186

Valuation Software Review Generative AI Technical Review 186

The Startup Lawyer

AUGUST 22, 2011

You need to figure out why your potential angel investor wants to control your startup. By paying your investor a dividend (rather than having dividends accrue and be paid out at acquisition or other typical payable events), you are simply paying back the investor with his own money. Non-Dilution.

Angel Investor 99

Angel Investor Dividend Dilution Cofounder 99

Gust

OCTOBER 17, 2011

Entrepreneurs sometimes assume an initial agreement with an angel is a commitment, so they start spending before any money is received. It’s true that angel investors typically do not present entrepreneurs with overly complicated deal structures, especially when compared to venture capitalists. Anti-dilution protection.

Term Sheet 158

Term Sheet Pre-Money Valuation Due Diligence Post-Money Valuation 158

JANUARY 9, 2014

No clear vision or purpose This should be the starting point for any startup founder, but it’s often overlooked. By trying to appeal to everyone and adding features left, right and centre, you will actually dilute your message and could end up with a complex, bloated product. Life’s too short to build something nobody wants.”

Early Stage 102

Early Stage Startup Cofounder Design 102

Startup Professionals Musings

JUNE 24, 2016

Here is my list, based on my own experience as a startup advisor, talking to other angel investors, and derived from the lean startup principles of venture advisor and entrepreneur Eric Ries : Strip the solution down to a focus on a key feature. This confuses customers, and dilutes your marketing impact.

Angel Investor 143

Angel Investor Dilution Matching Business Model 143

Startup Professionals Musings

MAY 1, 2016

Every startup needs to start their funding search looking for grants, with no equity dilution, as well as contests and foundations. These often lead to angel investors and venture capital investments later, or connections to local company venture funds for selected focus and technology areas.

Intellectual Property 120

Intellectual Property Accredited Investor Entrepreneur Incubator 120

Startup Company Lawyer

MARCH 14, 2010

Founders Institute Plain Preferred Term Sheet (by WSGR – disclaimer, I represent the Founders Institute and was involved in drafting this document). Certain angel investors refuse to do convertible debt deals, but will be okay if there is a price cap. Anti-dilution protection. Future rights. Board seat.

Finance 70

Finance Software Review Term Sheet Liquidation Preference 70

Berkonomics

JUNE 15, 2017

[Email readers, continue here…] There are also clauses in many such investor documents that allow the investor to override the founder and force a sale of the company if a proposed sale is attractive to an investor for liquidity, even if the founder feels that there is much more potential if the business is not sold at the present time.

Liquidity Event 97

Liquidity Event Initial Public Offering Dividend Valuation 97

Board Effect

MAY 13, 2019

Managing cap tables presents much less of a challenge to founders in their “garage days”; offering up their blood, sweat, and tears in sacrifice to the startup gods. When bootstrapping a startup, this is the bare minimum founders should have in place to avoid being caught off-guard by an angel investor.

Cap Table 40

Cap Table Management Liquidity Event Dilution 40

Startup Professionals Musings

AUGUST 1, 2016

After many years of working with angel investors seriously trying to find new ventures worthy of their hard-earned money, I find their frustration often exceeds that of entrepreneurs sincerely looking for financial help. Investors invest in people, often more so than in the product. Dysfunctional or non-functional team members.

Due Diligence 120

Due Diligence Intellectual Property Preferred Stock Seed Stage 120

David Teten

NOVEMBER 17, 2011

In particular, this model is designed to help all team members understand the impact of dilution on their options. Such a model is particularly helpful for those founders looking for a co-founder or key employee. Such a model is particularly helpful for those founders looking for a co-founder or key employee.

Employee 155

Employee IRR Startup Mexico 155