Both Sides of the Table

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Praying to the God of Valuation

Both Sides of the Table

Within 5 years I was on the board of real businesses with meaningful revenue, strong balance sheets, no debt and on the path to a few interesting exits. Deep down I love working with founders and products, strategy, go-to-market, financial management, pricing and all aspects of building a startup.

Valuation 466
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What is the Right Burn Rate at a Startup Company?

Both Sides of the Table

We want a strong balance sheet (um, ok. but that’s our firm’s money on your balance sheet. I call this “using your balance sheet as a strategic weapon.” We’re going to start aggressively spend money on marketing our product. otherwise I prefer to invest less and risk less).

Burn Rate 383
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Does the Size of a VC Fund Matter?

Both Sides of the Table

It in not uncommon to see a VC talk about “total assets under management&# as in “We have $1.5 billion under management.&# I don’t really understand why VCs do this since it’s mostly a meaningless number. What is total assets under management? -

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My Thoughts on the Current Market: on 20-Minute VC

Both Sides of the Table

A strong balance sheet will matter in the years ahead. Of our early-stage deals we do 33% Seed, 66% A’s) Why recycling is important, but why without exits you might even be forced to stop paying management fees for a while What Will Happen with LPs in this Economic Market? Raise when you can.

Marketing 263
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Don’t Try to “Pull an Instagram.” Here’s Why …

Both Sides of the Table

Just checked their balance sheet. They have $339 million in cash on their balance sheet. Strategic must be a hugely defensive move or a move that the management team of the buyer believes could drive a huge increase in future revenue to more than cover the costs of having acquired your company. Uh… yeah.

Valuation 316
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Should Startups Care About Profitability?

Both Sides of the Table

If you don’t have a strong balance sheet and can’t hire more people that’s fine — but understand this may lead to slower growth. That management team might have decided that they wanted to maintain more control of their company, didn’t want new board members and didn’t want to take dilution.

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Fauxmentum

Both Sides of the Table

But can sensible management team even do anything about it? I’m saying something simpler: protect your balance sheet and make sure you have enough cash to weather a slowdown and don’t let your reserves dip too low before raising more capital unless you have no choice. limit your fixed costs.