Feld Thoughts

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Techstars Equity Back Guarantee

Feld Thoughts

Today Techstars announced an “ equity back guarantee ” for any company that goes through the Techstars program starting in 2015. One day we started bouncing around the cliche “let’s put our money where our mouth is” which quickly morphed into “let’s put our equity where our mouth is.”

Equity 172
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Create Structure out of the Gate and You’ll Thank Yourself Later

Feld Thoughts

Here’s the punchline: if you run your company as if you have closed a VC equity financing round even though you actually closed a convertible debt round, you’ll be in much better shape when it comes time to raise your Series A financing. So why would you treat your debt investors (somewhat) like equity investors?

Burn Rate 152
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Finance Fridays: Getting Started – Allocating Equity and Founder’s Investment

Feld Thoughts

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
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SayAhh’s Revenue Projections

Feld Thoughts

It is simple in that it forecasts how much cash will be coming in the door (revenues + equity financing + debt financing) and then subtracts from that amount how much cash is expected to be going out the door. A simple cash forecast is just that – it is a model that helps anticipate cash balances over time. and a spend type (e.g.

Revenue 127
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Why Gross Profit Is More Important Than Revenue

Feld Thoughts

GP = Net Sales – Cost of Goods Sold GM = ((Net Sales – Cost of Goods Sold ) / Revenue). They tend to adjust the multiples to try to align with a group of comparison companies, but these comps rarely have a similar supply/demand economic associated with the equity of the company in question.

Revenue 179
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Investment vs. Speculation

Feld Thoughts

They happily traded equities for me, which mostly just cost me fees in the end, although I covered it all with a crazy transaction into a weird Exchange Fund that GS created in 2000. In the mid-1990s, when I had a bunch of money after the sale of my first company, I bought and sold some public company stocks.

Stock 172
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The Simple Formal Beginnings Of Feld Technologies

Feld Thoughts

It cost us $99 to do this – I remember using an organization called The Company Corporation - we called an 800 number, gave them some information, and the documents were automatically generated and filed. It’s one page. We incorporated a month later as an S-Corp.