Startup Professionals Musings

APRIL 4, 2022

My first advice for new entrepreneurs is to pick a domain that doesn’t have the sky-high up-front development costs, like online web sites and smart phone apps. That includes estimating the money required to get to the revenue stage, and saving money to cover costs before you jump off the cliff. Use crowd funding.

Intellectual Property 261

Intellectual Property Technical Review Incubator Bootstrapping 261

Startup Professionals Musings

AUGUST 24, 2016

So the first question I usually get is what percent of the company or equity is that person worth? Just because it was your idea doesn’t mean you “deserve” 90% of the equity. The value in a startup is all about tangible results, so I see no equity value in the idea alone. Amount of venture funding provided.

Equity 120

Equity Cofounder Technical Cofounder Intellectual Property 120

Startup Professionals Musings

APRIL 22, 2023

The first thing to remember is that banks only do loans – they generally don’t do equity investments like angels and venture capitalists (and vice versa). Bankers do not contribute equity. A question I get from time to time is “Can I ever expect any backing from my bank for a great opportunity?” Money from other sources.

Equity 303

Equity Silicon Valley Finance Early Stage 303

Startup Professionals Musings

NOVEMBER 25, 2020

Most of the experience so far has been cash versus the equity feature defined by the JOBS Act – Equity Crowdfunding (Title III) , introduced back in 2016 with 685 pages of rules. I would summarize the qualms and feedback from professional investors as the following: Crowdfunding platform costs trickle down to angel groups.

Equity 411

Equity Angel Groups Accredited Investor Due Diligence 411

Startup Professionals Musings

DECEMBER 6, 2019

My first advice for new entrepreneurs is to pick a domain, such as online web sites and smart phone apps, that doesn’t have the sky-high up-front development costs. That includes estimating the money required to get to the revenue stage, and saving money to cover costs before you jump off the cliff. Use crowd funding to build reserves.

Finance 320

Finance Intellectual Property Technical Review Incubator 320

Startup Professionals Musings

OCTOBER 19, 2022

In fact, perhaps the most important model, equity crowdfunding for non-accredited investors was legalized via the SEC way back in 2016, and its impact is still not fully understood. Startup equity model. In Europe, other investors can buy equity, with platforms such as Seedrs. In the U.S.,

Accredited Investor 352

Accredited Investor Startup SEC Equity 352

Startup Professionals Musings

FEBRUARY 8, 2021

Especially if you are a first-time business owner, the payback for this initiative is well worth the effort and cost. Unfortunately, I see too many new entrepreneurs who let their passion for a new idea or invention blind them to the stark realities of customer need, opportunity size, or pricing and cost implications.

Advisory Board 356

Advisory Board Bandwidth Cofounder Technical Review 356

Startup Professionals Musings

MAY 14, 2023

Things will cost more than you expect. Deferred payments start with stretching the payables period but, more importantly, include giving employee equity in lieu of a higher salaries and negotiating vendor deferred payments out of future revenues. Cash flow out equates to burn rate, and the runway depends on your reserves.

Burn Rate 258

Burn Rate Hockey Stick Management Salary 258

Startup Professionals Musings

FEBRUARY 8, 2013

If one of your core values is exceeding your customer expectations for quality and service, and your potential partner ascribes to the low cost, high profit mantra, a successful partnership is highly unlikely over the long-term. Is your project seen by both as an end in itself, or a means to another end? Similar values and goals.

Partner 258

Partner Software Review CTO Hire Equity 258

Startup Professionals Musings

JUNE 30, 2019

My first advice for new entrepreneurs is to pick a domain that doesn’t have the sky-high up-front development costs, like online web sites and smart phone apps. That includes estimating the money required to get to the revenue stage, and saving money to cover costs before you jump off the cliff. Use crowd funding.

Intellectual Property 219

Intellectual Property Technical Review Startup Incubator 219

Startup Professionals Musings

OCTOBER 6, 2023

Sales and distribution channel activity will be analyzed, as well as cost of customer acquisition, to make an independent assessment of your financial projections. Startup equity investments imply a long-term business relationship, lasting an average of five years.

Technical Review 296

Technical Review Due Diligence Term Sheet Bankruptcy 296

Startup Professionals Musings

JANUARY 20, 2020

In fact, perhaps the most important model, equity crowdfunding for non-accredited investors was only legalized via the SEC in 2016, so its impact is still in the early stages. Startup equity model. In Europe, other investors can buy equity, with platforms such as Seedrs. In the U.S.,

Accredited Investor 324

Accredited Investor Entrepreneur SEC Equity 324

Startup Professionals Musings

AUGUST 19, 2020

Things will cost more than you expect. Deferred payments start with stretching the payables period but, more importantly, include giving employee equity in lieu of a higher salaries and negotiating vendor deferred payments out of future revenues. Cash flow out equates to burn rate, and the runway depends on your reserves.

Burn Rate 310

Burn Rate Hockey Stick Salary Angel Investor 310

Startup Professionals Musings

JUNE 2, 2021

That means that many companies are now forgoing the rush to go public (IPO), in favor of major equity investments from specialized venture capital funds, such as Japan’s SoftBank. It’s now more intense than ever, with the cost of entry going down, and new players easily able to join the fray from anywhere in the world.

Software Review 355

Software Review Algorithm Global IPO 355

Startup Professionals Musings

JULY 14, 2014

My first advice for new entrepreneurs is to pick a domain that doesn’t have the sky-high up-front development costs, like online web sites and smart phone apps. That includes estimating the money required to get to the revenue stage, and saving money to cover costs before you jump off the cliff. Use crowd funding.

Entrepreneur 283

Entrepreneur Intellectual Property Technical Review Incubator 283

Startup Professionals Musings

FEBRUARY 19, 2013

My first advice for new entrepreneurs is to pick a domain that doesn’t have the sky-high up-front development costs, like online web sites and smart phone apps. That includes estimating the money required to get to the revenue stage, and saving money to cover costs before you jump off the cliff. Use crowd funding.

Intellectual Property 309

Intellectual Property Technical Review Venture Capital Startup 309

Startup Professionals Musings

JANUARY 12, 2018

My first advice for new entrepreneurs is to pick a domain, such as online web sites and smart phone apps, that doesn’t have the sky-high up-front development costs. That includes estimating the money required to get to the revenue stage, and saving money to cover costs before you jump off the cliff. Use crowd funding to build reserves.

Intellectual Property 134

Intellectual Property Technical Review Startup Incubator 134

Startup Professionals Musings

JANUARY 24, 2021

Sales and distribution channel activity will be analyzed, as well as cost of customer acquisition, to make an independent assessment of your financial projections. Startup equity investments imply a long-term business relationship, lasting an average of five years.

Technical Review 379

Technical Review Due Diligence Term Sheet Bankruptcy 379

Startup Professionals Musings

AUGUST 4, 2014

The first question I usually get is what percent of the company or equity is that person worth? Just because it was your idea doesn’t mean you “deserve” 90 percent of the equity. The value in a startup is all about tangible results, so there is no equity value in the idea alone. Amount of venture funding provided.

Cofounder 261

Cofounder Stock Founder Technical Cofounder 261

Startup Professionals Musings

FEBRUARY 13, 2013

A grant is not an equity investment, so the entrepreneur doesn’t have to give up a stake in the company either. But before you conclude that your funding problems are solved with grants, you should consider the direct and indirect costs of grant funding: Grant applications are bureaucratic. Professional help costs money.

Government 230

Government Equity Cost SBIR 230

Startup Professionals Musings

MAY 21, 2023

For example, professional investors put great priority on your previous experience in building a business, and they expect to own a portion of the business equity and control for the funds they do provide. Trade equity or services for startup help. Another common example is exchanging equity for legal and accounting support.

Equity 266

Equity Startup Small Business Administration SBA 266

Startup Professionals Musings

SEPTEMBER 29, 2018

Things will cost more than you expect. Deferred payments start with stretching the payables period but, more importantly, include giving employee equity in lieu of a higher salaries and negotiating vendor deferred payments out of future revenues. Cash flow out equates to burn rate, and the runway depends on your reserves.

Burn Rate 223

Burn Rate Hockey Stick Startup Salary 223

Startup Professionals Musings

AUGUST 6, 2023

Most of the experience so far has been cash versus the equity feature defined by the JOBS Act – Equity Crowdfunding (Title III) , introduced back in 2016 with 685 pages of rules. I would summarize the qualms and feedback from professional investors as the following: Crowdfunding platform costs trickle down to angel groups.

Angel Groups 201

Angel Groups Accredited Investor Due Diligence Equity 201

Startup Professionals Musings

JULY 8, 2015

My first advice for new entrepreneurs is to pick a domain, such as online web sites and smart phone apps, that doesn’t have the sky-high up-front development costs. That includes estimating the money required to get to the revenue stage, and saving money to cover costs before you jump off the cliff. Use crowd funding to build reserves.

Entrepreneur 120

Entrepreneur Intellectual Property Technical Review Incubator 120

Startup Professionals Musings

FEBRUARY 29, 2020

Most entrepreneurs never forget for a moment that having investors means owing money, even if they can legally argue that equity is not debt. It’s usually the small investors who want the most frequent updates, or phone calls before every direction change, and investor relations costs only go up as your business grows.

Bootstrapping 310

Bootstrapping Advisory Board Venture Capital Startup 310

Startup Professionals Musings

FEBRUARY 21, 2012

The cost of giving up more equity early is often more than offset by the increased flexibility to recover from mistakes. Your startup will require more money than you expect, and the cost of going back to the well is very high. Pay people with equity or future revenue. Include buffer when you raise money. Great strategy.

Burn Rate 232

Burn Rate Startup Salary Equity 232

Startup Professionals Musings

SEPTEMBER 7, 2018

This process costs money, which professional investors are not willing to contribute, since their interest is in scaling a proven product and business model into a growth business. through Grants.gov , an online directory of more than 1,000 federal grant programs that don’t look for equity or payback.

Early Stage 225

Early Stage SBIR Technical Review Seed Stage 225

Startup Professionals Musings

APRIL 23, 2013

Bootstrapping avoids all the cost, pain, and distractions of finding angels or VCs, and allows you to keep control and all your hard-earned equity for yourself. Every outside hire increases your cost and risk. In summary, watch your costs, trust your gut, and drive forward with all the passion in your dream.

Equity 241

Equity Bootstrapping Startup Merger 241

Startup Professionals Musings

SEPTEMBER 25, 2023

The average amount per startup has been $23,000, usually in the form of a convertible loan, rather than an equity investment. The vehicle of choice is most often a convertible note, which is really a loan with a specified duration and interest, with an option to convert it to equity when professional investors come in later.

Sweat Equity 274

Sweat Equity Elevator Pitch Startup Equity 274

Startup Professionals Musings

JULY 28, 2017

In the heat of scaling the business, it’s tempting to skip the cost and time of finding qualified job candidates, and enlist those close at hand, without paying them a competitive wage for the hard work and commitment you need. Retain maximum equity by requesting minimal funding. Remember the old adage that you get what you pay for.

Cost 180

Cost Advisory Board Entrepreneur Angel Investor 180

Startup Professionals Musings

DECEMBER 23, 2013

Yet, according to many sources , over 90 percent of all businesses are started and grown with no equity financing, and many others would have been better off without it. In fact, most of the rich entrepreneurs you know actively turned away early equity proposals. Need expensive resources up front.

Bootstrapping 252

Bootstrapping Sweat Equity Entrepreneur Technical Review 252

Startup Professionals Musings

AUGUST 29, 2020

For example, professional investors put great priority on your previous experience in building a business, and they expect to own a portion of the business equity and control for the funds they do provide. Trade equity or services for startup help. Another common example is exchanging equity for legal and accounting support.

Equity 436

Equity Small Business Administration SBA Syndicate 436

Startup Professionals Musings

MAY 18, 2020

It’s more possible to bootstrap today than a few years ago, as the cost of entry continues to go down. With one of the many new tools , and a dose of sweat equity, you can create a website for almost nothing -- and you are on your way to success with ecommerce, your latest invention or personal services.

Hockey Stick 423

Hockey Stick Bootstrapping Sweat Equity Intellectual Property 423

Startup Professionals Musings

OCTOBER 5, 2014

Things will cost more than you expect. Deferred payments start with stretching the payables period but, more importantly, include giving employee equity in lieu of a higher salaries and negotiating vendor deferred payments out of future revenues. Cashflow out equates to burn rate, and the runway depends on your reserves.

Burn Rate 262

Burn Rate Hockey Stick Entrepreneur Salary 262

Startup Professionals Musings

JANUARY 28, 2011

The cost of giving up more equity early is often more than offset by the increased flexibility to recover from mistakes. Your startup will require more money than you expect, and the cost of going back to the well is very high. Pay people with equity or future revenue. Include buffer when you raise money. Great strategy.

Burn Rate 231

Burn Rate Startup Salary Equity 231

Startup Professionals Musings

JUNE 25, 2012

A startup incubator is a company, university, or other organization which provides resources for equity to nurture young companies, helping them to survive and grow during the startup period when they are most vulnerable. An investment from a venture capital firm is usually expensive, in equity and control. Startup incubators.

Technical Review 257

Technical Review Bootstrapping Venture Capital Incubator 257

Startup Professionals Musings

JUNE 12, 2015

Every investor in your startup, even friends and family, normally expects a share of your company (equity), which means your return for all your effort goes down quickly. The indirect costs of time and effort to find the right grant, complete the application and manage the process, even if you win, can be substantial.

SBIR 120

SBIR Equity Technical Review Early Stage 120