Both Sides of the Table

MAY 9, 2011

I covered what I call “the co-founder mythology.&# Either you’re not technical and you think you need a technical co-founder or vice-versa. Conventional wisdom says that you gain far more in working as a team than you lose by diluted by half before you start. Hire your co-founder.

Cofounder 393

Cofounder Founder Vesting Founder Vesting 393

Both Sides of the Table

SEPTEMBER 17, 2011

I recently wrote a post about why I didn’t think early-stage startups should have COOs. I’d say about 80% of the experienced entrepreneurs & VCs I know privately agreed with me. “We’re all equal co-founders and we don’t care about titles.&# Dilute your cash, equity or both.

Operations 292

Operations CTO Hire Startup Early Stage 292

Both Sides of the Table

AUGUST 3, 2010

There is a telltale sign of an inexperienced startup entrepreneur. years ago and told me, “I just got offered the chance to buy this company because the founder doesn’t want to continue. How much dilution should I take for it?&# My friend’s company was pre-revenue. Me: “Zero dilution.

Merger 276

Merger Technical Review Early Stage Dilution 276

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.

Pre-Money Valuation 150

Pre-Money Valuation Web Technical Review Angel Investor 150

YoungUpstarts

MAY 6, 2019

These people exist and they are called ‘Serial entrepreneurs.’. Serial entrepreneurs are those who understand the complete concept of a startup lifecycle and benefit from that. In this article, we will discuss why it is important to understand the whole startup stages concept before you start a business to get the most benefit.

Startup 113

Startup Technical Cofounder Merger Early Stage 113

View from Seed

APRIL 30, 2015

What is it, and how should founders think about it? From a company milestones perspective, entrepreneurs who take on venture debt are almost always thinking about raising that next round of capital from other institutions. At NextView, for instance, one of our more popular posts centers on atypical seed rounds to know.

Term Sheet 120

Term Sheet Equity Startup Seed Stage 120

David Teten

AUGUST 19, 2019

RBI normally requires founders to pay back their investors with a fixed percentage of revenue until they have finished providing the investor with a fixed return on capital, which they agree upon in advance. For background, see Revenue-Based Investing: A New Option for Founders who Care About Control. Capital need of up to $1.5M

Revenue 60

Revenue Technical Review Software Review Equity 60

JANUARY 9, 2014

No clear vision or purpose This should be the starting point for any startup founder, but it’s often overlooked. I recently developed a more human framework for early-stage startups to define their startup DNA and lay some foundations for a sustainable business. People who focus exclusively on efforts that matter, succeed.

Early Stage 102

Early Stage Startup Cofounder Design 102

Both Sides of the Table

JUNE 5, 2015

In the old days there usually weren’t convertible notes on early-stage deals and there weren’t party rounds with 20 angels or 6 seed funds. So how DOES a VC think about financings at early stages? If you’re a solo founder and haven’t built out your team or engineers I’m likely to want 15+%.

Pre-Money Valuation 150

Pre-Money Valuation Option Pool Post-Money Valuation Dilution 150

Both Sides of the Table

APRIL 27, 2014

Seed investors are aplenty and of course they need downstream money to fuel their early-stage bets. Of course these are great places to network with other investors, meet great entrepreneurs and keep your connections strong with senior execs at larger companies like Yahoo!, Co-founder discontent. Web Summit.

Cofounder 374

Cofounder Syndicate Syndication Early Stage 374

Both Sides of the Table

DECEMBER 1, 2009

I was reading one of my favorite websites for entrepreneurs, VentureHacks, this weekend and noticed that they are running a long piece on how to pick a co-founder. Once it’s set up I recommend bringing in a co-founder and giving them 10-30% of the company depending upon when you bring them in.

Hiring 289

Hiring Cofounder Dilution Startup 289

Both Sides of the Table

MAY 30, 2018

One of the hardest things about the fund-raising process for entrepreneurs is that you’re trying to raise money from people who have “asymmetric information.” As an entrepreneur it can feel as intimidating as going to buy a car where the dealer knows the price of every make & model of a car and you’re guessing at how much to pay.

Valuation 324

Valuation Post-Money Valuation Pre-Money Valuation Cofounder 324

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). If new investors get better rights in a future equity financings (such as registration rights, price-based anti-dilution, redemption rights, etc.), Anti-dilution protection.

Finance 70

Finance Software Review Term Sheet Liquidation Preference 70

View from Seed

APRIL 16, 2015

An easy way to think about it is that value over time doesn’t go up and to the right in a straight line like this: Instead, it’s more of a stair step like this: So, what are the value inflection points that create the stair steps, and how does one think about it at the earliest stages? These might include: Bring on a technical co-founder.

Seed Stage 120

Seed Stage Cofounder Early Stage Startup 120

View from Seed

JANUARY 26, 2016

With that in mind, let’s look at an illustration of these trends below, which demonstrates what’s been happening to early-stage financing rounds over the last 15 years or so. Series A investors invested quite early, often before product/market fit.

Seed Stage 120

Seed Stage Early Stage Cofounder Finance 120

David Teten

AUGUST 21, 2019

Most founders who are raising capital look first to traditional equity VCs. RBI normally requires founders to pay back their investors with a fixed percentage of revenue until they have finished providing the investor with a fixed return on capital, which they agree upon in advance. Less or no dilution. But should they?

Revenue 60

Revenue Liquidation Preference Equity Cofounder 60

David Teten

JANUARY 21, 2021

(co-written with Jamie Finney, Founding Partner at Greater Colorado Venture Fund. This essay is part of a series on alternative VC: I: Revenue-Based Investing: a new option for founders who care about control. III: Why are Revenue-Based VCs investing in so many women and underrepresented founders?

Equity 78

Equity Revenue Cofounder Colorado 78

Both Sides of the Table

APRIL 14, 2012

” In this week’s discussion with entrepreneurs I think the word impending wasn’t used often enough. Let me remind readers as I outlined in this post , there are VERY FEW M&A transactions for early-stage startup companies above $100 million. You just said, “nobody would take 1-2% dilution.”

Valuation 316

Valuation Balance Sheet Dilution Term Sheet 316

View from Seed

SEPTEMBER 9, 2014

This is a guest post from Stephano Kim , former co-founder of Web 1.0 success story Blackboard and veteran entrepreneur who’s held several COO and president roles at various startups. Many startup CEOs hire COOs or launch companies with a co-founder carrying the title. When should founders hire one?

Hiring 336

Hiring Cofounder Startup Technical Cofounder 336

Both Sides of the Table

APRIL 3, 2010

I know many super experienced entrepreneurs who don’t understand the basics of how fund size and age can affect them so I thought it was worth establishing a baseline. In a world of The Funded, VentureHacks and entrepreneur blogs this kind of informations spreads like wildfire. Let me explain: 1. We took the $500k.

Venture Capital 265

Venture Capital Term Sheet Early Stage Silicon Valley 265

This is going to be BIG.

DECEMBER 28, 2013

Every time he opens his mouth about founder diversity, he seems completely out of his league to address the topic. The biggest question I think VC''s face right now is whether or not, in the future, the best founders will look and act like the best founders of the past. YC''s best investing days may be behind it. That''s 25%.

Venture Capital 152

Venture Capital Cofounder IRR Dilution 152

David Teten

OCTOBER 1, 2015

Should you co-found your company with a software development shop? I’ve seen a range of options for supporting entrepreneurs, which I can rank from least to most involvement in companies by investors: financier VCs, e.g., Correlation Ventures. The question is: how should they be compensated when cofounding a company? The cliffs?

Software Developers 60

Software Developers Software Development Software Review Technical Cofounder 60

Feld Thoughts

JULY 29, 2011

Finance Friday’s gets off the ground with today’s post by introducing you to an imaginary startup, the entrepreneurs that we’ll being following throughout the series, and their first challenges: splitting up the founders’ equity and addressing the case where one of the founders provides the initial seed capital for the business.

Equity 137

Equity Finance Pre-Money Valuation Denver 137

Austin Startup

MARCH 7, 2021

It seems like every day there is a new headline about an exceptional startup founder, investor, or corporate headquarters moving to Texas. It’s like a dam has broken and now there is a flood of new entrepreneurs, investors, and big companies moving to Texas. Startups and investors should treat Texas like one big city. Joe Lonsdale.

Texas 90

Texas San Antonio Houston Dallas 90

Business Plan Blog

OCTOBER 4, 2013

This is true for early stage funding as well as venture capital funding. If you have a technical background and you are focused on product development, consider a co-founder with a sales and marketing background that can focus on selling your world class product. Don’t make everyone a founder. Early Stage.

Part-Time VPE 79

Part-Time VPE Fractional VPE Cofounder CTO Hire 79

Berkonomics

AUGUST 27, 2015

He has served as advisor to and member of numerous financial exchanges, and was the founder and CEO of Arthur Lipper Corporation and co-founder and Chairman of New York & Foreign Securities Corporation. It used to be that entrepreneurs started businesses as a life’s work, a mission. By Arthur Lipper.

Intellectual Property 48

Intellectual Property Balance Sheet Stock Options Valuation 48

David Teten

DECEMBER 2, 2019

Now the bad news: some venture capitallists have a bias against startups with an explicit positive social impact, on the grounds that they have a smaller addressable market, and that the founders are not sufficiently focused on creating shareholder wealth. If you think I’ve missed any, please contact me. Aspen Tech Policy Hub.

Technical Review 60

Technical Review SBIR Dilution Silicon Valley 60

aweissman.com

JANUARY 30, 2010

Venture Innovation, or why the First Round Capital Entrepreneurs Exchange fund is good. There is an amazing wealth of innovation around early stage venture financing, most of which developed in just the past few years. In many cases they are run by operational entrepreneurs themselves. skip to main | skip to sidebar.

Early Stage 46

Early Stage Entrepreneur Cofounder Framework 46

The Next Web

OCTOBER 3, 2012

Andrew is the co-founder and CTO of Parse.ly , a technology startup that provides big data insights to the web’s best publishers. He wrote: When startups die, the official cause of death is always either running out of money or a critical founder bailing. Editor’s note: This is a guest post by Andrew Montalenti.

Cofounder 155

Cofounder Technical Cofounder Technical Review Software Review 155

Agile VC

JULY 11, 2012

Some disgruntled younger partners left in the mid-90s… two co-founded Benchmark Capital (Bruce Dunlevie & Andy Rachleff). But eventually some disgruntled younger partners left and two started August Capital (Dave Marquardt & John Johnson) and one co-founded Benchmark (Bob Kagle). But it’s not quite that simple.

Silicon Valley 240

Silicon Valley Carried Interest Cofounder Boston 240

Rob Go

NOVEMBER 13, 2013

Instead, those funds try to invest in companies that can be “bigger”, but at the early stage, it’s hard to differentiate companies that could be $400M exits vs. $1B exits. The large fund may say to the founder,” wouldn’t you rather just raise $8M instead of $5M for the same (or marginally more) dilution?”

Dilution 61

Dilution Seed Stage Early Stage Cofounder 61

Both Sides of the Table

OCTOBER 17, 2009

With open source software (LAMP stack) and cloud computing infrastructure it just wasn’t that expensive to get your company going and founders just wanted to raise less money. I was an early cynic. I told entrepreneurs that it was a bit of a Faustian bargain. They do many early-stage deals.

Software Review 283

Software Review Term Sheet Due Diligence Southern California 283

venturehacks.com

SEPTEMBER 22, 2011

When you evaluate a candidate, ask yourself whether she is likely to increase the next round’s share price (include the dilution of her market rate options). Entrepreneurs should think about unbundling money and value add. That’s a core argument for early-stage high-value angels, seed funds, and Y Combinator.

Equity 40

Equity Cap Table Valuation RSS 40

Both Sides of the Table

FEBRUARY 25, 2010

A reminder that it is important for all entrepreneurs is to remember to be careful about “deal drift.” But we weren’t optimizing for dilution – we were building a $1 billion+ company and we wanted the runway to succeed. I’ve offered to fund an early stage company where I promised cash in bank in less than 30 days.

Technical Review 301

Technical Review Term Sheet Due Diligence Venture Capital 301

The Next Web

AUGUST 19, 2013

Mikita Mikado is a software engineer and entrepreneur from Belarus, now based in San Francisco. He is the co-­founder and CEO of Quote Roller and PandaDoc. It’s always better to be earn money, not just raise it, as money you earn doesn’t dilute your ownership and reassures your investors.

Belarus 137

Belarus Viral Channel Startup 137

maplebutter.com

JANUARY 8, 2013

If you’re an Entrepreneur, you can do it from any place in the world. How important is education when I know I want to be an entrepreneur? Whats is the best way to find a co-founder for your startup? I’m part of an early startup made up of four friends, we’re all motivated and really dedicated to our startup.

Technical Review 44

Technical Review Startup Cofounder Software Review 44

Reid Hoffman

AUGUST 17, 2021

Greylock investor Sridhar Ramaswamy , who co-founded search engine startup Neeva , says it’s more important for startups to think about creating a product that is useful and resonates with people before worrying about whether a large incumbent is doing it. TRANSCRIPT.

Cofounder 69

Cofounder Differentiation Search Advertising 69