Steve Blank

MARCH 17, 2020

The questions every startup or small business CEO needs to ask now are: What’s my Burn Rate and Runway? What does your new business model look like? Burn Rate and Runway. To answer the first question, take stock of your current gross burn rate i.e. how much cash are you spending each month.

Burn Rate 436

Burn Rate Startup Valuation Sales Cycle 436

Steve Blank

APRIL 26, 2022

At the turn of the century after the dotcom crash, startup valuations plummeted, burn rates were unsustainable, and startups were quickly running out of cash. Most existing investors (those still in business) hoarded their money and stopped doing follow-on rounds until the rubble had cleared. Why do VCs Do This?

Cram Down 414

Cram Down Founder Venture Capital Recapitalization 414

Startup Professionals Musings

DECEMBER 15, 2014

Even a small investor in the early days will take a large equity percentage, due to that pesky valuation challenge. At least wait until later, when you ready to scale, and have some “leverage” based on a proven business model, some real customers, and real revenue. Sometimes survival requires staying under the radar.

Bootstrapping 276

Bootstrapping Entrepreneur Startup Burn Rate 276

Startup Professionals Musings

AUGUST 27, 2012

Investors like $1B markets with double-digit growth rates. Business model. In this section, you need to be passionate about recurring revenue, profit margin, and volume growth. Project both revenues and expense totals for next five years, and past three years. Implicit in this is the go-to-market strategy.

Elevator Pitch 247

Elevator Pitch Exit Strategy Burn Rate Merger 247

Startup Professionals Musings

AUGUST 7, 2015

How the solution and business model work to fund the business. 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 will impatiently expect a winning business model, customer segment definitions and volume projections.

Product 120

Product Intellectual Property Liquidity Event Burn Rate 120

ReadWriteStart

JANUARY 27, 2011

And, oh by the way, we also really like the idea of the 1M/1M entrepreneurs building valuation and negotiating leverage through these business development efforts, instead of signing off large chunks of their company in form of equity early on. The business is already profitable with $2.9 million in revenue.

Dilution 114

Dilution Revenue Finance Entrepreneur 114

Startup Professionals Musings

JUNE 28, 2013

Even a small investor in the early days will take a large equity percentage, due to that pesky valuation challenge. At least wait until later, when you ready to scale, and have some “leverage” based on a proven business model, some real customers, and real revenue. Sometimes survival requires staying under the radar.

Startup 264

Startup Burn Rate Bootstrapping Valuation 264