Up and Running

SEPTEMBER 19, 2017

Capital investments are like gasoline on a startup business’s metaphorical fire. They allow you to hire more people, purchase new technology, and establish new business connections, among many other benefits. Takeaway lesson: A shocking number of technology startups never even get their first product out the door.

Private Equity 94

Private Equity Pre-Money Valuation Equity Startup 94

Startup Professionals Musings

NOVEMBER 21, 2016

They know it’s especially hard to provide a financial return with a free business model. Many companies, including Patagonia and Zappos, have used their social focus to enhance their business, but highlight financial return when talking to investors. Terms “paradigm shift” or “disruptive technology” used more than once.

Intellectual Property 120

Intellectual Property Valuation Technical Review Equity 120

Startup Professionals Musings

JUNE 26, 2013

It’s higher risk, but higher return, to pick the big winners early, before Angels have set unreasonable valuations and restrictive terms. Technology costs are plummeting, meaning you can do more with less. That could cause this bubble to burst and hurt everyone.

Angel Investor 231

Angel Investor Entrepreneur Early Stage Silicon Valley 231

Startup Professionals Musings

OCTOBER 20, 2017

Yet in my role as business advisor, I often see companies naively ignoring this reality. Today, the move to digital technology is driving marketplace change at a seemingly ever-increasing rate. Think about the up-and-comers during the past decade that have either created new business models or stolen share from established players.

Technical Review 136

Technical Review Demand Valuation Business Model 136

ReadWriteStart

JANUARY 13, 2024

Startups in the cybersecurity sector are facing a daunting market environment , contending with decreased valuations and increasing pressure to sell while competing for vital funding and collaborations.

Down Round 154

Down Round Marketing Artificial Inteligence Startup 154

A Smart Bear: Startups and Marketing for Geeks

AUGUST 18, 2015

They have everything: money, brand, momentum, existing customers, press, product teams, distribution channels, expertise, market insight, analysts, sales offices, product features, and, by definition, a working business model. In the big-boy and big-girl world of real, at-scale companies, valuation is about total future earnings.

Technical Review 120

Technical Review Valuation Flash Revenue 120

Steve Blank

MARCH 31, 2014

Look at the valuations of companies like Tesla, Illumina, and Twitter. The first will be commodity businesses that are valued for their ability to execute their current business model. The second class will be firms with a demonstrated ability to continually innovate and reinvent their business models.

Private Equity 325

Private Equity Metrics China Intellectual Property 325

Startup Professionals Musings

JANUARY 7, 2013

The market and venture capitalists are looking for business, but with a continuing focus on proven business models. Here are some key action items that may give your business some visibility: Start with an investment-grade business plan. To make this work, you will need an initial valuation of at least $5M.

Venture Capital 252

Venture Capital IPO Elevator Pitch Initial Public Offering 252

Tim Keane

JANUARY 12, 2010

Term-sheets and Valuations: Thinking about Negotiations.   I’ve sat down with entrepreneurs and a copy of a term sheet guide I like [ “Term Sheets & Valuations - A Line by Line Look at the Intricacies of Venture Capital Term Sheets & Valuations ” by Alex Wilmerding, Aspatore Press.] The Valuation Question.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

SoCal CTO

FEBRUARY 2, 2011

Because of this, I've always tried to stay up-to-speed on how early-stage investors look at valuation of companies. Think about how you can prove your business model with an MVP. Bill Payne is an expert on how early-stage investors should look at valuation. What are they really looking for? is a requirement.

Valuation 198

Valuation Revenue Pre-Money Valuation Early Stage 198

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. I usually envision a 50-50 ownership split for their efforts, but every engineer believes the technology side deserves the majority share. Fabulous solutions require great technology.

Technical Review 120

Technical Review Intellectual Property Cofounder Bootstrapping 120

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. They’re Back.

Cram Down 404

Cram Down Founder Venture Capital Recapitalization 404

Both Sides of the Table

JUNE 22, 2011

Responses ranged from, “hey, they’re in a HUGE market&# to “it is an amazing company and their technology rocks.&# In addition to FOMO it is partly driven by massive increase in valuations for earlier-stage companies who raised money at bit seed prices but who still have product risk. Why does all this matter?

Saudi Arabia 309

Saudi Arabia Valuation IPO Technical Review 309

Startup Professionals Musings

NOVEMBER 14, 2010

Unfortunately, we read far more poorly written business plans at Main Street than good ones. Entrepreneurs tend to write business plans that are difficult to read, heavy on technology, and give little thought to the business model and commercialization strategy. Participation.

Intellectual Property 265

Intellectual Property Balance Sheet Phoenix Arizona 265

thebarefootvc

JANUARY 27, 2014

Do I think we are in a valuation bubble? I think that later stage valuations are frothy (for reasons I explain below) while earlier stage valuations are starting to stabilize from previous highs (with the exception of the superstar serial entrepreneur) - turns out scaling in a sea of competition (both startup and entrenched) is not so easy.

Technical Review 63

Technical Review Valuation Venture Capital Investment Bankers 63

Startup Professionals Musings

SEPTEMBER 9, 2010

It’s higher risk, but higher return, to pick the big winners early, before angels have set unreasonable valuations and restrictive terms. Technology costs are plummeting, meaning you can do more with less. That could cause this bubble to burst and hurt everyone.

Technical Review 215

Technical Review Early Stage Venture Capital Startup 215

View from Seed

AUGUST 17, 2021

90% of the airtime around ownership and valuations is focused on what happens when the first check is written. Effective post money is the effective valuation of an investor’s dollars at any one time. Also, being too dogmatic isn’t very fun J. What matters is effective post-money at exit. We think about this a lot too.

IRR 205

IRR Dilution Founder Portfolio 205

View from Seed

AUGUST 17, 2021

90% of the airtime around ownership and valuations is focused on what happens when the first check is written. Effective post money is the effective valuation of an investor’s dollars at any one time. Also, being too dogmatic isn’t very fun J. What matters is effective post-money at exit. We think about this a lot too.

IRR 156

IRR Dilution Founder Portfolio 156

SoCal CTO

JUNE 9, 2010

Draw Your Ideas - A VC : Venture Capital and Technology , May 16, 2010 I saw Jack Dorsey give this talk at The 99% Conference last month. The Yin and Yang of Product and Engineering - A VC : Venture Capital and Technology , May 22, 2010 For a tech company, product and engineering are the heart and soul of the business.

Fractional CTO 248

Fractional CTO Startup Venture Capital Cofounder 248

David Teten

JANUARY 19, 2021

Yes, via conversion rights at a valuation cap. Yes, via conversion rights at a valuation cap. Typical business stage. An already proven business model and its already valuable assets. Typical business model. Technology-centric businesses. Technology-centric businesses.

Cofounder 78

Cofounder Technical Review Equity Dividend 78

Startup Professionals Musings

NOVEMBER 4, 2011

It should answer every question an investor or associate might ask, including current valuation, funding needed, and exit strategy. Finalize your financial model. Like the business plan, a financial model is required as much for your own use as to impress angel investors. This is called “validating the business model.”

Intellectual Property 249

Intellectual Property Angel Investor Technical Review Elevator Pitch 249

View from Seed

AUGUST 17, 2021

90% of the airtime around ownership and valuations is focused on what happens when the first check is written. Effective post money is the effective valuation of an investor’s dollars at any one time. Also, being too dogmatic isn’t very fun J. What matters is effective post-money at exit. We think about this a lot too.

IRR 136

IRR Dilution Founder Portfolio 136

The Startup Magazine

JUNE 1, 2023

There are currently tons of “zombie” startups that have runway, but growth has slowed and they have valuations that they won’t be able to grow into. And they probably never will be unless business model viability is reassessed across the board. they still aren’t profitable.

Early Stage 118

Early Stage Los Angeles Silicon Valley Cofounder 118

Austin Startup

OCTOBER 15, 2017

What seems to be the best way to create customers and revenue may result in a business model that is out of vogue with the investment world and shortchanges you on enterprise valuation. A good example is the marketing technology sector. He forgot a major highlight of the business model, and the damage was done.

Technical Review 48

Technical Review Software Review Nevada Silicon Valley 48

YoungUpstarts

JANUARY 6, 2014

I remain the major shareholder in a number of what we consider “built-to-last” companies, all with strong valuations and ROI potential. I’ve invested in a bar, flipped real estate, restored a classic car, and am always thinking of new technology products. Then start at the end and build your product or process backwards.

San Francisco 154

San Francisco Business Model Silicon Valley Coder 154

David Teten

AUGUST 20, 2019

I’ve been a traditional equity VC for 8 years, and I’m now researching new business models in venture capital. Note that Clearbanc has a somewhat different business model than the RBI VCs I list here.). Less need for a belief in breakthrough technology. It was just because we looked at data.” Realistic projections.

Revenue 60

Revenue Cofounder Founder Venture Capital 60

Startup Professionals Musings

SEPTEMBER 23, 2010

It should answer every question an investor or associate might ask, including current valuation, funding needed, and exit strategy. Finalize your financial model. Like the business plan, a financial model is required as much for your own use as to impress angel investors. This is called “validating the business model.”

Angel Investor 224

Angel Investor Intellectual Property Technical Review Elevator Pitch 224

Steve Blank

SEPTEMBER 14, 2009

Posted on September 14, 2009 by steveblank Over the last 30 years Wall Street’s appetite for technology stocks have changed radically – swinging between unbridled enthusiasm to believing they’re all toxic. Large companies were acquiring technology startups just to get in the game at the same absurd prices.

Silicon Valley 217

Silicon Valley IPO Technical Review Venture Capital 217

Lightspeed Venture Partners

OCTOBER 7, 2012

This includes calling current and prospective customers, understanding technology and manufacturing, doing reference calls on the founders and key executives, verifying financial and legal information and often other items specific to the company. In the real world, he would make those calls BEFORE investing, not after.

Technical Review 110

Technical Review Technical Cofounder Valuation Pre-Money Valuation 110

Version One Ventures

OCTOBER 1, 2019

What was one of the highest flying start-ups with a private market valuation of $47B was brought down to Earth when trying to IPO. The major point that often gets forgotten is that no business model is the same. Great start-ups can be built in many categories and with many different business models.

Valuation 116

Valuation Vertical IPO Business Model 116

Up and Running

OCTOBER 13, 2014

By 2010, Vuzit had been hired by two large companies – a bank and an aerospace firm — to “help brainstorm and implement new technologies.” The bank wanted to develop mobile deposit technology quickly so that it could keep pace with its competitors. The Bottom Line for Small Businesses.

Intellectual Property 106

Intellectual Property Philadelphia Small Business California 106

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

Startup Professionals Musings

JULY 27, 2018

I’m a technologist, so I always love to learn about the product, but every investor needs to make sure you have a business, as well as a product. Unfortunately, customers look for value in solving their problem, and new technologies alone scare them, so these solutions don’t get bought by customers, or funded.

Product 145

Product Intellectual Property Liquidity Event Exit Strategy 145

David Teten

DECEMBER 3, 2019

When I met my now-wife, I realized that any technology that can find me a spouse is a killer app. But in business, you want a lot of partners. I’d argue that the same type of technologies that have revolutionized dating can revolutionize our industry. . When I was single, I registered for (a lot of) dating websites.

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

Feld Thoughts

AUGUST 25, 2015

The key reason for the explosion in capital flowing into the industry, and therefore the large increase in practitioners, had nothing to do with 1970’s performance, early stage investing, or technology. So contrary to the piece, it wasn’t VC were good at early stage technology, it was that they had newfound capital and a big exit window.

Venture Capital 70

Venture Capital SBIC Technical Review Silicon Valley 70

VC Cafe

FEBRUARY 27, 2024

Everyone moved to earlier stage – part of the decline in late stage investing is the ‘baggage’ of companies that previously raised money at inflated valuations that they would struggle to justify in today’s market. That’s yet another reason for micro funds to move earlier in the fundraising timeline.

Valuation 186

Valuation Software Review Generative AI Technical Review 186

Startup Lessons Learned

SEPTEMBER 22, 2008

Lessons Learned by Eric Ries Monday, September 22, 2008 The three drivers of growth for your business model. The AARRR model (hence pirates, get it?) He also has a discussion of how your choice of business model determines which of these metric areas you want to focus on. Choose one.

San Francisco 167

San Francisco CPA SEM CTO Hire 167