David Teten

DECEMBER 15, 2018

It’s much better to calculate the total cost of shutting down, publicize it to the board, and then declare defeat once your cash in bank hits that level. If you haven’t already, I suggest list on ExitRound , a zero-fixed-cost platform for increasing your odds of finding a likely buyer. It’s expensive to shut down.

Startup 60

Startup Later Stage Technical Review Software Review 60

Both Sides of the Table

JUNE 30, 2011

Or the Cliff Note’s version: Open Source & Cloud Computing (led by Amazon) drove down tech startup costs by 90%. With more competition in early-stage many VCs are investing smaller amounts at earlier stages. Some are going later stage to not miss out on hot deals. I call this “stage drift.&#.

Venture Capital 289

Venture Capital Early Stage Valuation Angel Investor 289

Startup Professionals Musings

SEPTEMBER 11, 2020

Accelerators generally accept startups at a slightly later stage, and attempt to compress the timeline to commercialization into a few months, instead of a year or more. Direct seed funding, for a share of the equity, and introductions to investors. Peer-to-peer networking with other startups and founders in the same stage.

Incubator 398

Incubator Silicon Valley North America Startup 398

VC Adventure

AUGUST 15, 2018

Most boards did some level of work to determine the FMV of a company’s stock but generally options were priced between 10% and 15% of a company’s then preferred price (because common equity sits behind preferred equity there is typically a discount applied to the FMV of common stock to account for this “overhang”).

Valuation 48

Valuation Common Stock Cap Table Software Review 48

Berkonomics

AUGUST 3, 2023

When the need is high… For the rest of us, desiring to build large, valuable enterprises quickly, the need for outside capital is high on our list of requirements and even the source for some sleepless nights as we worry over the availability and cost of capital. Often private equity investors will want control of the business as well.

Private Equity 118

Private Equity Valuation Cap Table Accredited Investor 118

Both Sides of the Table

APRIL 6, 2014

I know that in later-stage growth equity deals some firms even hire third-parties who will do the reference calls. When they rep you, the marginal cost of them trying to get you a slightly better deal is high for them relative to settling and moving on. They hold out. They wait for a better offer. They’re not in a rush.

Technical Review 302

Technical Review Hiring Later Stage Employee 302

David Teten

JUNE 22, 2012

By excising just the tumor and leaving the rest of the organ, surgeons can help patients reduce the risk of early mortality, reduce patient complications, reduce costs of healthcare, and reduce the backlogged demand for kidney donations. Torsh, Inc.’s domestic market.

Programming 128

Programming Accredited Investor Naming New York 128

Austin Startup

JUNE 30, 2017

TL;DR : Elite accelerators have cemented themselves as the universities of the entrepreneurial world; offering a bundle of resources in exchange for a price (tuition in form of equity). in exchange for a price: usually 6–9% of equity, with (sometimes) heavy anti-dilution rights, and pro-rata rights.

Curation 48

Curation Startup Cofounder Equity 48

David Teten

JUNE 22, 2012

By excising just the tumor and leaving the rest of the organ, surgeons can help patients reduce the risk of early mortality, reduce patient complications, reduce costs of healthcare, and reduce the backlogged demand for kidney donations. Torsh, Inc.’s domestic market.

Programming 114

Programming Accredited Investor Naming New York 114

David Teten

JULY 25, 2017

Large private equity funds like KKR can afford to pursue a consulting model ( Capstone ), typically with associated fees, but that doesn’t normally make economic sense for a VC. Effectively, we are a market maker between our portfolio companies and the late-stage VCs and large enterprises which are our co-investors.

Portfolio 60

Portfolio Technical Review Private Equity Database 60

Startup Professionals Musings

NOVEMBER 4, 2018

Accelerators generally accept startups at a slightly later stage, and attempt to compress the timeline to commercialization into a few months, instead of a year or more. Direct seed funding, for a share of the equity, and introductions to investors. Peer-to-peer networking with other startups and founders in the same stage.

Incubator 218

Incubator Silicon Valley North America Small Business Administration 218

David Teten

JANUARY 21, 2021

V: Should you raise venture capital from a traditional equity VC or a Revenue-Based Investing VC? VI: Revenue-based financing: The next step for private equity and early-stage investment. VIII: The Leading Flexible VCs, With Structures Between Equity and Revenue-Based Investing. We plan to raise $2.5m

Equity 78

Equity Revenue Cofounder Colorado 78

Hippoland

JANUARY 4, 2017

Here’s a quick primer on how investments tend to work in startup companies at the seed stage. Equity Traditionally, investors have invested in companies to receive equity, or shares in a company. Later, if you sell the whole company to Google at say $5 per share, I will earn $500k for a net gain of $400k.

Convertible Security 48

Convertible Security Equity Security Silicon Valley 48

View from Seed

SEPTEMBER 14, 2021

Q: What is going to happen to the cost of capital? Q: What is the opportunity cost of not being in tech? Early-stage valuations are up 70%, and late-stage valuations are up 103% (source Pitchbook ). Source: Cambridge Associates (VC) & TradingView (Equities). Are low interest rates structural, or temporal? .

Valuation 319

Valuation Pre-Money Valuation Distribution Early Stage 319

David Teten

JANUARY 9, 2018

In a prior life, I served as a consultant to Goldman Sachs Special Situations Group, Carl Icahn’s organization, and some other very large private equity investors. I saw “ portfolio operations ,” i.e., levers to enhance the operations efficacy of portfolio companies, become a standard part of the private equity toolkit.

Venture Capital 60

Venture Capital Private Equity Silicon Valley Differentiation 60

David Teten

JANUARY 9, 2018

In a prior life, I served as a consultant to Goldman Sachs Special Situations Group, Carl Icahn’s organization, and some other very large private equity investors. I saw “ portfolio operations ,” i.e., levers to enhance the operations efficacy of portfolio companies, become a standard part of the private equity toolkit.

Venture Capital 60

Venture Capital Private Equity Silicon Valley Differentiation 60

The Startup Magazine

FEBRUARY 6, 2020

The buyers (or lessees) in these transactions are pension funds, insurance companies, or private equity representing other institutions. Private Equity sees infrastructure investing as uncorrelated diversification and has the additional upside of correcting any operational inefficiencies. Public Good Concerns.

Private Equity 129

Private Equity New York City Chicago Investment Bankers 129

View from Seed

SEPTEMBER 14, 2021

Q: What is going to happen to the cost of capital? Q: What is the opportunity cost of not being in tech? Early-stage valuations are up 70%, and late-stage valuations are up 103% (source Pitchbook ). Source: Cambridge Associates (VC) & TradingView (Equities). Are low interest rates structural, or temporal? .

Valuation 295

Valuation Pre-Money Valuation Distribution Early Stage 295

Startup Professionals Musings

APRIL 6, 2016

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 new free 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.

Bootstrapping 120

Bootstrapping Hockey Stick Sweat Equity Intellectual Property 120

ReadWriteStart

MARCH 3, 2021

Limited brand equity. If you focus too much on short-term measures, you’ll have trouble sustaining long-term growth in a cost-efficient way. An effective early-stage growth strategy would be: Inexpensive, capable of being executed on even a limited budget with a limited team. For example, if the cost per click (CPC) is $0.50

Early Stage 125

Early Stage PPC Retention Churn Rate 125

The Next Web

AUGUST 26, 2013

I’ve seen a few businesses where the first investors took huge pieces of equity for very little money. 15-20% equity for first investors. Depending on your team and the risk of the business, you should reserve 15% to 20% of equity for the first investors you get on board. Avoid making those mistakes and define a fair structure.

Management 120

Management Cofounder Startup Bootstrapping 120

Startup Professionals Musings

SEPTEMBER 1, 2014

Accelerators generally accept startups at a slightly later stage, and attempt to compress the timeline to commercialization into a few months, instead of a year or more. Direct seed funding, for a share of the equity, and introductions to investors. Peer-to-peer networking with other startups and founders in the same stage.

Incubator 247

Incubator Silicon Valley Startup Small Business Administration 247

David Teten

SEPTEMBER 5, 2014

I’ve written on the expert network industry a fair amount in the past: see How to Earn More Consulting Revenue from Expert Networks and How Executives Can Work with Private Equity and Venture Capital Portfolio Companies. We’re not mainly for B2B companies or later stage companies or anything like that. It varies case-to-case.

New York 114

New York Technical Review Networking Advisory Board 114

Both Sides of the Table

APRIL 28, 2010

It seems the focus on “virtual&# goods has been both the demo of the consumer as well as the fact that by definition virtual goods have almost no marginal costs to the seller so giving a huge slice to the carrier (and Zong) isn’t a problem since actual costs are ~ $0. 15mm in Series A. 4mm in Series A.

Venture Capital 270

Venture Capital Cofounder Spain San Diego 270

YoungUpstarts

JUNE 1, 2016

Full disclosure – any kind of financing comes with costs, whether it’s interest payments, equity, and/or your very valuable time which, as an entrepreneur, is the thing you will always wish you had more of. The good news is that technology has opened up avenues that didn’t exist 10 years ago.

Finance 100

Finance Angel Investor Cofounder Later Stage 100

Up and Running

AUGUST 17, 2015

Whether you plan to hire an accountant or depend on QuickBooks, there are some basic principles around understanding your working capital, cost of goods sold (COGS), gross margins, and so on, that are critical to all types of businesses. Accounting: There is no substitute for learning the fundamentals of accounting.

Entrepreneur 60

Entrepreneur Cofounder Angel Investor eCommerce 60

Both Sides of the Table

JANUARY 21, 2010

You never got around to agreeing exact equity splits but you had many conversations about it. How to manage costs - One of the biggest frustrations that people have with lawyers are unexpected costs. On later stage LA Tech M&A deals I’ve heard there’s none better than David Hernand of Gibson Dunn.

Southern California 318

Southern California Silicon Valley IP Stock Options 318

View from Seed

SEPTEMBER 14, 2021

Q: What is going to happen to the cost of capital? Q: What is the opportunity cost of not being in tech? Early-stage valuations are up 70%, and late-stage valuations are up 103% (source Pitchbook ). Source: Cambridge Associates (VC) & TradingView (Equities). Are low interest rates structural, or temporal? .

Valuation 156

Valuation Pre-Money Valuation Distribution Early Stage 156

Berkonomics

MARCH 21, 2019

If the business is not a startup, expect to supply income statements for the past several years as well, to emphasize trends in revenue and costs. The more you ask for – the more equity you give up. And it is probable that you’ll need more money to reach that target, muddying the calculation and reducing your equity percentage.

Hockey Stick 63

Hockey Stick Liquidity Event Valuation Balance Sheet 63

Startup Professionals Musings

OCTOBER 17, 2016

Accelerators generally accept startups at a slightly later stage, and attempt to compress the timeline to commercialization into a few months, instead of a year or more. Direct seed funding, for a share of the equity, and introductions to investors. Peer-to-peer networking with other startups and founders in the same stage.

Incubator 120

Incubator Silicon Valley Startup Small Business Administration 120

www.payne.org

SEPTEMBER 22, 2011

Startup Equity For Employees. 7 Salary vs Equity. The re-heating of the venture funded tech market has pushed a heat up of the hiring market, and Im getting more calls from friends asking for help understanding startup stock (equity) offers. The total preference is less of an issue in early stage companies (e.g.

Equity 56

Equity Employee Vesting Preferred Stock 56

David Teten

DECEMBER 3, 2019

Private equity and venture capital investors are copying our sisters in the hedge fund world: we’re trying to automate more of our job. . In the private equity universe, most Partners have primary training as deal-makers, not as managers. (To see the video above, please click the image, and then click on the Play button.).

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

Berkonomics

JUNE 8, 2017

For the rest of us desiring to build large, valuable enterprises quickly, the need for outside capital is high on our list of requirements and even the source for some sleepless nights as we worry over the availability and cost of capital. Venture, private equity and more: Here we lump a large number investor classes into one.

Private Equity 106

Private Equity Valuation Cap Table Accredited Investor 106

Both Sides of the Table

JULY 15, 2010

Convertible debt is a loan to the company that doesn’t typically get paid back but rather “converts&# into equity when you raise a larger round at a later date. If you’re an entrepreneur, all else equal you prefer convertible debt because the deal is priced at a later stage when you’re worth more.

Southern California 210

Southern California Venture Capital Seed Stage Angel Investor 210

A Crowded Space

AUGUST 26, 2013

Note: for this article I am referring to equity crowd-funding exclusively. Consider an early stage company - and assume they have 2 choices, pursue crowd-funding or raise VC money. The crowd option brings - simplicity, speed, low cost, transparency, and, in theory, means taking money from anyone willing to write a check.

Later Stage 87

Later Stage Liquidity Event Equity Vertical 87

Gust

SEPTEMBER 5, 2012

How to finance a new seed-stage startup? Convertible equity? The new form of convertible security or “convertible equity” is essentially a convertible note containing most of the usual terms — except it’s been stripped of the features that would make it a loan. Convertible debt?

Finance 134

Finance Convertible Security Equity Seed Stage 134

K9 Ventures

OCTOBER 10, 2017

Yes, the infrastructure is cheap (to start), but the human costs have gone up dramatically. Unless every aspect of product development is covered by founders who are only receiving equity, there are other parts of building a product that will require hiring highly qualified people. Those times are long gone.

Seed Stage 82

Seed Stage Finance Later Stage Equity 82