Steve Blank

SEPTEMBER 5, 2018

Reading the NY Times article “ Jeffrey Katzenberg Raises $1 Billion for Short-Form Video Venture, ” I realized it was time for a new startup heuristic: the amount of customer discovery and product-market fit you need to find is inversely proportional to the amount and availability of risk capital. ” Fire, Ready, Aim.

Lean 335

Lean Burn Rate Startup IPO 335

Austin Startup

APRIL 25, 2017

Revenue needs to grow 20x, and margins must expand dramatically. I won’t dive into cost structure in this blog post, but let’s think through how Snap could grow revenue 20x. I won’t dive into cost structure in this blog post, but let’s think through how Snap could grow revenue 20x. How can one justify a $20B valuation for Snap?

Valuation 48

Valuation Technical Review Forecast Social Network 48

YoungUpstarts

JANUARY 10, 2018

How do you find the balance between not too small to prove itself but not too big to have an off-putting valuation? Minimizing losses in the year before you begin shopping around for buyers will increase profit and help you get that higher valuation. Profile Your Customer Base. Another important metric is churn.

Valuation 145

Valuation Technical Review Exit Strategy Metrics 145

VC Adventure

AUGUST 31, 2017

If you read my blog regularly you know I love (LOVE) metrics. So no surprise that when River Cities Capital released an overview of SaaS operating and valuation benchmarks, I hung on every juicy detail. They took the 92 public SaaS companies and analyzed their key operating metrics. The valuation metrics show this clearly.

IPO 113

IPO Vertical Balance Sheet Valuation 113

Startup Professionals Musings

OCTOBER 18, 2023

New startup founders keep all the operating metrics they need in their head. Even if you don’t have a formal board of directors, it pays to have trusted advisors who will give you regular unbiased feedback on your team strengths and weaknesses, financial and operating ratio norms, and an external view of current company valuation issues.

Exit Strategy 248

Exit Strategy Valuation Acquisition Metrics 248

Both Sides of the Table

NOVEMBER 14, 2017

There is nothing more pure than building a product, putting it out in the world and seeing paying customers using your product and in some cases loving it. As companies get this initial customer feedback on their product they start to have to ask harder questions about unit economics: How much does it cost us to acquire a new customer?

Operations 286

Operations New York City Technical Review Startup 286

The Startup Magazine

OCTOBER 22, 2020

Businesses utilize a plethora of information to assess markets, competitors, customer preferences, organizational performance, etc. You can better understand what drives your customers and their repeat purchases. Through data analysis, you can pinpoint your repeat purchasers, which further helps build customer relationships.

Analytics 131

Analytics Portfolio Advertising Technical Review 131

Startup Professionals Musings

JANUARY 9, 2021

New startup founders keep all the operating metrics they need in their head. Even if you don’t have a formal board of directors, it pays to have trusted advisors who will give you regular unbiased feedback on your team strengths and weaknesses, financial and operating ratio norms, and an external view of current company valuation issues.

Exit Strategy 434

Exit Strategy Valuation Acquisition Metrics 434

YoungUpstarts

SEPTEMBER 16, 2015

What’s critical for entrepreneurs to understand is that valuations for startups do not increase at a linear rate; they increase geometrically based on achieving the right milestones. The best entrepreneurs raise enough money to achieve a set of interim milestones and then raise capital again at a significantly increased valuation.

Valuation 100

Valuation Dilution Chicago Technical Review 100

Startup Professionals Musings

JUNE 22, 2016

That should make you wonder - how do you measure traction in a metric? While thinking about the parameters of traction, and how to measure it, I was impressed with a new book, “ Scaling Lean: Mastering the Key Metrics for Startup Growth ” by Ash Maurya, a serial entrepreneur, and creator of the one-page business modelling tool Lean Canvas.

Metrics 143

Metrics Advisory Board Startup Lean 143

Steve Blank

MARCH 31, 2014

Companies horde cash and squeeze the most revenue and margin from the money they use. Metrics like Return on Net Assets, Return on Capital and Internal Rate of Return are the guiding stars of the board and CEO. Look at the valuations of companies like Tesla, Illumina, and Twitter.

Private Equity 326

Private Equity Metrics China Intellectual Property 326

Steve Blank

MARCH 17, 2020

If you’re running a startup or small business, your first priority (after your family) is keeping your employees and customers safe. Next, take a look at your actual revenue each month – not forecast, but real revenue coming in each month. Subtract your monthly gross burn rate from your monthly revenue to get your net burn rate.

Burn Rate 436

Burn Rate Startup Valuation Sales Cycle 436

YoungUpstarts

NOVEMBER 20, 2019

You may be able to generate revenue, but VCs want exponential growth. The market for our product was global, and we had unique advantages in terms of our product and how we distributed it to customers. Have a reasonable attitude about your early-stage valuation, and don’t get too hung up on it. Be ready when it counts.

Technical Review 140

Technical Review Due Diligence Early Stage Differentiation 140

Startup Professionals Musings

MAY 4, 2016

Who would not want to joint the unicorns (recent startups with a current valuation of over $1 billion)? Building a minimum viable product, with customer validation. Before you bring on partners, develop intellectual property, raise capital, or generate revenues, you need to establish an official business entity.

Intellectual Property 120

Intellectual Property Startup Angel Groups Social Media 120

Startup Professionals Musings

SEPTEMBER 22, 2021

They need to believe your valuation, based on current revenue and intellectual property, and feel the equity offered gives them a real return for the risk. These show a focus on the business elements required for success, and metrics for ensuring accountability, management control, and feedback along the way.

Intellectual Property 352

Intellectual Property Equity Bootstrapping Valuation 352

Both Sides of the Table

FEBRUARY 15, 2016

There is much talk these days that startup valuations have decreased and may continue to do so and that the amount of time it takes to fund raise may take longer. The earlier the round, the less capital you need and the more reasonable your valuation the less time that is needed generally to raise capital.

Burn Rate 150

Burn Rate Cap Table Valuation Software Review 150

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

www.forentrepreneurs.com

FEBRUARY 2, 2010

Blog About Log in Register Startup Killer: the Cost of Customer Acquisition In the many thousands of articles advising entrepreneurs on what they have to focus on to build successful startups, much has been written about three key factors: team, product and market, with particular focus on the importance of product/market fit.

Acquisition 103

Acquisition Cost Customer Entrepreneur 103

Startup Lessons Learned

SEPTEMBER 22, 2008

Master of 500 Hats: Startup Metrics for Pirates (SeedCamp 2008, London) This presentation should be required reading for anyone creating a startup with an online service component. He also has a discussion of how your choice of business model determines which of these metric areas you want to focus on.

San Francisco 167

San Francisco CPA SEM CTO Hire 167

Startup Professionals Musings

JULY 31, 2020

These days, customers expect to hear and see social and environmental value from a new business, rather than just a new technology or profit. Many aspiring entrepreneurs are so focused on their technology, that they display no interest or credible understand of the financials and metrics of growing a business.

Entrepreneur 312

Entrepreneur Angel Investor Valuation Leadership 312

The Startup Magazine

MARCH 24, 2024

It is a quantified metric that focuses on the speed of turning prospects into customers. Accelerating your B2B pipeline is about turning up its velocity so that it zips through stages and transforms prospects into paying customers briskly. The higher the velocity, the more predictable and scalable the revenue becomes.

B2B 126

B2B Forecast Entrepreneur Analytics 126

The Startup Magazine

APRIL 24, 2020

Whether you’re interested in selling a website you built from scratch, or want to sell your Amazon-based B2C brand, there are many different baseline factors that go into determining an appropriate website valuation number. While it’s true that valuations can get quite technical, the basics are relatively easy to understand.

eCommerce 91

eCommerce Valuation B2C Revenue 91

The Equity Kicker

FEBRUARY 8, 2012

VCs evaluate products by looking at demos and having a play themselves, by soliciting third party opinion and by looking at whether and how customers are using and paying for the product. Valuation for Pre-revenue, pre-traction startup (jackyyapp.com). supply chain management, marketing), but not a good product. askthevc.com).

Technical Review 123

Technical Review Product Venture Capital Valuation 123

Cracking the Code

FEBRUARY 23, 2011

It would have been easy to explain the difference by changes in the 2010/2011 revenue growth projections but unfortunately that is not the case. revenues while large caps are trading at 6.4x. Detailed SaaS Spreadsheet (Valuation and CAC benchmark). SaaS 13 Index Valuation. SaaS business metrics: why are they different?

Software Review 101

Software Review Technical Review Valuation Europe 101

Gust

JULY 23, 2014

So even if my own mother asked me to meet with you, and you were pitching me a biotech opportunity for a $10 million investment at a $90 million valuation, I might take the meeting, but it wouldn’t be particularly useful for either of us. Now comes the really tricky part: getting me to review all that stuff you just neatly uploaded.

Angel Investor 153

Angel Investor Elevator Pitch Pre-Money Valuation Technical Review 153

A Smart Bear: Startups and Marketing for Geeks

DECEMBER 16, 2014

Still… Now Slack has been valued at over a billion dollars, less than a year after launch, every month adding more than a million dollars of annual recurring revenue. What does it actually mean that metric X is better than average and metric Y is below? “It’s not fair,” we all said to ourselves.

Metrics 246

Metrics Early Stage Retention Revenue 246

YoungUpstarts

APRIL 5, 2019

Are you fresh out of Y Combinator with $1 million in funding at a $10 million valuation? But flattering media attention too easily shifts focus away from the metrics that matter. Call me old school, but I believe in metrics like growth, revenue, and profit. All other metrics are irrelevant.

Valuation 162

Valuation Cofounder Metrics SEC 162

Steve Blank

SEPTEMBER 14, 2009

Five Quarters of Profitability During the 1980’s and through the mid 1990’s startups going public had to do something that most companies today never heard of – they had to show a track record of increasing revenue and consistent profitability. They taught you about customers, markets and profits.

Silicon Valley 223

Silicon Valley IPO Technical Review Venture Capital 223

Agile VC

MAY 26, 2011

LinkedIn’s product had only been live for a couple months, we only had tens of thousands of registered users, and wouldn’t start generating revenue for more than a year after this point. round which closed in November 2003, and the pre-money valuation between $10 million and $15 million. It was a $4.7M link] leehower.

Term Sheet 178

Term Sheet Silicon Valley Technical Review Social Network 178

crowdSPRING Blog

NOVEMBER 1, 2013

Good whitepaper on advertising measurement metrics | by Ben Kunz – crowdspring.co/HsVIMR. Good whitepaper on advertising measurement metrics | by Ben Kunz – crowdspring.co/HsVIMR. Don’t pay lip service to customer service | USA Today - crowdspring.co/1ioAoDm. But a nearly $4 billion valuation?

Social Media 94

Social Media Small Business Design Media 94

David Teten

SEPTEMBER 23, 2017

An investor had few hard metrics other than the actual financials, and little technology to make the process scaleable. Over the past few decades, better metrics became available, and investors could take a more analytical, data-driven approach. ” Historically, investing was a manual, artisan process.

Private Equity 60

Private Equity Venture Capital Equity Technical Review 60

ConversionXL

AUGUST 11, 2021

A sponsorship strategy should cover five areas: Assets Audience data Asset valuation Activations Market identification. To uncover audience problems and motivations, call on your brand market research or customer service data. Asset valuation. Your assets are what you can offer to a sponsor to get them in front of your audience.

Audience 139

Audience Social Media Email Ruby 139

Reid Hoffman

MARCH 23, 2021

The metrics from the dashboard are the key inputs for collective decisions. You can always instrument your business and gather metrics, but that doesn’t mean the data you gather will be useful. For example, if you haven’t achieved product-market fit, instrumenting every aspect of customer acquisition is overkill.

Venture Capital 46

Venture Capital Metrics Investment Bankers Framework 46

VC Cafe

OCTOBER 23, 2022

The CEO shared the revenue target for the year at X, and the revenue target for next year at 3X. One of the board members asked a simple question: “Why is revenue our North Star KPI? One of the board members asked a simple question: “Why is revenue our North Star KPI?”

Metrics 179

Metrics Revenue B2C Portfolio 179

David Teten

AUGUST 6, 2015

It’s misleadingly precise to have two digits to the right of the decimal in a CAC/LTV multiple for year 3 of your forecast (“Customer Acquisition Cost”/”LifeTime Value of Customer”). financial statement summaries, valuation analysis, ratio analysis, etc.) Use an appropriate number of significant digits. 12) Design for printing.

Balance Sheet 60

Balance Sheet Software Review Forecast Acquisition 60

Startup Professionals Musings

AUGUST 13, 2012

In fact, a business plan is needed more by you than investors, as the blueprint for your company, team communication, and progress metrics. Terms like “every customer needs this” and “next generation platform” are far too soft, and should be avoided. Clearly define the customer, channel, and revenue model associated with this solution.

Business Plan 283

Business Plan Sweat Equity Exit Strategy Intellectual Property 283

Cracking the Code

DECEMBER 1, 2009

Detailed SaaS Spreadsheet (Valuation and CAC benchmark). SaaS 13 Index Valuation. SaaS business metrics: why are they different? The recession created opportunities! S&M productivity (CAC ratio) for the SaaS 13 Index. Note: high CAC ratio means high productiviy (see blog post for definition). My Investments. anecdotes. (13).

Software Review 48

Software Review Technical Review Cloud Europe 48