Startup Professionals Musings

NOVEMBER 10, 2012

In fact, it’s all about the “focus” required to get early stage technology products across the deadly chasm from early adopters to mainstream customers. It takes focus to resist adding a long list of features that seem to make the opportunity larger, but dilute to focus of both you and potential customers.

Startup 254

Startup Technical Review Dilution Early Stage 254

Startup Professionals Musings

DECEMBER 11, 2022

Getting investors to trust you with their money is always a challenge, and it’s even more difficult in the early stages, where you don’t have a significant revenue stream, a few customers, or maybe even a product yet. At these stages, it’s all about you, and your ability to communicate and execute effectively.

Due Diligence 271

Due Diligence Intellectual Property Entrepreneur Preferred Stock 271

Austin Startup

JULY 6, 2018

Ask the Users Startup Accelerators: Bundled and Unbundled Over the past several years, accelerators have emerged as a powerful filtering and signaling mechanism in early-stage startup ecosystems, allowing high-potential young startups to connect with investors, advisors, and other strategic partners far faster and more efficiently than before.

Dilution 48

Dilution Startup Technical Review Equity 48

Startup Professionals Musings

SEPTEMBER 13, 2011

In fact, it’s all about the “focus” required to get early stage technology products across the deadly chasm from early adopters to mainstream customers. It takes focus to resist adding a long list of features that seem to make the opportunity larger, but dilute to focus of both you and potential customers.

Marketing 238

Marketing Entrepreneur Technical Review Dilution 238

Startup Professionals Musings

APRIL 12, 2021

These programs don’t usually ask for equity, and they are particularly targeted to the early stages of your business to facilitate growth and survival. Similarly, a custom contract for a big customer can get you over a growth gap, without diluting your brand in the market.

Dilution 404

Dilution Incubator Bootstrapping Government 404

YoungUpstarts

MAY 6, 2019

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. Early Stage. This startup stage starts from the day you decide to work on a startup idea. Here is the complete list of points available in early stage startup.

Startup 113

Startup Technical Cofounder Merger Early Stage 113

YoungUpstarts

SEPTEMBER 16, 2015

Raise too much capital at any given stage and suffer more dilution than is necessary – obviously not ideal. John Vrionis is a partner at Lightspeed Venture Partners who focuses primarily on early stage enterprise and consumer technology investments. It’s part art, part science. Set Quantifiable Goals.

Valuation 100

Valuation Dilution Chicago Technical Review 100

Startup Professionals Musings

AUGUST 27, 2010

In fact, it’s all about the “focus” required to get early stage technology products across the deadly chasm from early adopters to mainstream customers. It takes focus to resist adding a long list of features that seem to make the opportunity larger, but dilute to focus of both you and potential customers.

Startup 227

Startup Technical Review Dilution Early Stage 227

Startup Professionals Musings

MARCH 14, 2020

Getting investors to trust you with their money is always a challenge, and it’s even more difficult in the early stages, where you don’t have a significant revenue stream, a few customers, or maybe even a product yet. At these stages, it’s all about you, and your ability to communicate and execute effectively.

Due Diligence 308

Due Diligence Intellectual Property Preferred Stock Seed Stage 308

This is going to be BIG.

NOVEMBER 28, 2021

In fact, it’s why many startup folks leave the early stage world to go over to the big company side—because the benefits tend to be much better. Plus, you can allow people to vest into the program. Take a little more dilution, raise a little more money, and spend on the most ignored personal goal in the market.

Hiring 179

Hiring Early Stage Marketing Term Sheet 179

David Teten

AUGUST 19, 2019

We have a special program if you are pre-seed and need product development. Benefits: Non-dilutive, flexible credit offerings that fit SMB or enterprise SaaS. Founders First Capital Partners (FFCP) runs a 5-step process: Attend the Appropriate Pre-Funding Accelerator Program. Alternative Capital. “ Capital need of up to $1.5M

Revenue 60

Revenue Technical Review Software Review Equity 60

ReadWriteStart

SEPTEMBER 10, 2010

You can get cash without diluting your ownership in the company. These roundtables are the cornerstone programming of a global initiative that I have started called One Million by One Million ( 1M/1M ). In 1M/1M, our preferred financing strategy is customers. Because customer financing equals revenue, not equity.

Cloud 115

Cloud Silicon Valley Incubator Finance 115

Both Sides of the Table

AUGUST 30, 2010

Funnily enough I just answered this question yesterday on Quora when somebody asked, “Why would an early-stage investor specifically NOT prefer a convertible note structure to straight equity (e.g. Why many early-stage investors DO price rounds (e.g. 20-25% dilution). What about “super angel&# funds?

Equity 319

Equity Early Stage Angel Investor Valuation 319

Startup Professionals Musings

AUGUST 1, 2016

Getting investors to trust you with their money is always a challenge, and it’s even more difficult in the early stages, where you don’t have a significant revenue stream, a few customers, or maybe even a product yet. At these stages, it’s all about you, and your ability to communicate and execute effectively.

Due Diligence 120

Due Diligence Intellectual Property Preferred Stock Seed Stage 120

Both Sides of the Table

MARCH 21, 2010

In this example if they sell only $10,000 in total in year one they own zero warrants the same way that an employee with options who quits after 6 months usually owns no options when they leave your company (due to the cliff period in most vesting programs). Like sales programs I’m not a fan of an “all or nothing&# figure.

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Warrant Dilution Startup Stock Options 298

Austin Startup

DECEMBER 7, 2017

When Sputnik ATX funds a company in our program, we give them $100,000 through a SAFE note. There are two problems with early stage investing: telling how much a company is worth when truthfully, it is still worthless; and helping early-stage companies protect themselves from over dilution when they are, effectively, worthless.

Covenant 48

Covenant Cap Table Early Stage SBA 48

David Teten

JANUARY 21, 2021

VI: Revenue-based financing: The next step for private equity and early-stage investment. Jonathan Bragdon , CEO, describes Capacity as “a team of founders-turned-funders making non-dilutive, founder-aligned investments of $50-$300k in post-startup, post-revenue businesses planning to 2X revenues in 12-24 months.

Equity 78

Equity Revenue Cofounder Colorado 78

VC Adventure

AUGUST 30, 2010

I think the answer to these questions are that 1) it’s not at all clear that this trend is as definitive as Graham suggests; 2) it’s a mixed bag for entrepreneurs (more positive in the short run, potentially negative in the long term); and 3) it’s clearly not a positive trend for early-stage investors. Has Convertible Debt Won?

Angel Investor 103

Angel Investor Early Stage Equity Valuation 103

Transformify

JULY 23, 2018

To boost innovation and SME sector growth, the EU Commission has launched the SME Instrument of the Horizon 2020 program – the largest non-dilutive fund in the world. Why non-dilutive? EUR 3 billion are available to fund a maximum of 7,500 startups by 2020! It is a grant, not an equity funding.

Intellectual Property 66

Intellectual Property Angel Investor Dilution Startup 66

Both Sides of the Table

APRIL 3, 2010

The problem with VC Seed Funding – Chris is right to raise the issue with entrepreneurs because there have been instances where large VC funds have set up seed programs where the investments have been used as “options.&# There are many problems with this. They said that they didn’t want the extra money or dilution.

Venture Capital 265

Venture Capital Term Sheet Early Stage Silicon Valley 265

David Teten

DECEMBER 2, 2019

I’m now researching non-dilutive funding for Action Tank , a startup I’m gestating to “Make America Functional Again”. I worked with outsourced research firm Wonder * to identify all of the institutions we could who support tech impact startups with cash and community, and in many cases without dilution. Aspen Tech Policy Hub.

Technical Review 60

Technical Review SBIR Dilution Silicon Valley 60

Berkonomics

SEPTEMBER 28, 2017

Here is the warning: The execution of partnership equity allocations and of a good incentive program using equity is often mismanaged, damaging the corporate capitalization structure and even affecting the outcome of subsequent investment into the company. I just couldn’t reduce it to far fewer words… Dave. There are some rules.

Early Stage 102

Early Stage Equity Stock Options Vesting 102

rapidrollout.wordpress.com

JANUARY 15, 2011

By deciding to use a consulting CTO on a temporary basis, you avoid getting stalled in the earliest stages. And finally, you may be able to avoid diluting your equity. Preserve your equity by using a consulting CTO to ramp up your company before securing early-stage financing and hiring a permanent technology partner.

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Fractional CTO CTO CTO Hire Fractional VPE 40

Feld Thoughts

FEBRUARY 28, 2023

However, the lack of a conversion right also has implications for anti-dilution protection: in the U.S., In Germany, anti-dilution protection is achieved by issuing additional preferred shares. It is not uncommon for companies wanting to go public to relocate their registered office to the USA at an early stage.

Germany 165

Germany Liquidation Preference Option Pool Advisory Board 165

aweissman.com

JANUARY 30, 2010

There is an amazing wealth of innovation around early stage venture financing, most of which developed in just the past few years. If not, the value of the exchange fund is diluted. But, its a great example of a virtuous circle - each component of the program strengthens and enhances each other.

Early Stage 46

Early Stage Entrepreneur Cofounder Framework 46

Austin Startup

MARCH 7, 2021

The University of Houston has the number one undergraduate entrepreneurship program in the country and Rice University has the number one graduate entrepreneurship program in the country. Research Institute, Texas Biomedical Research Institute, and several public universities and Department of Defense research and development programs.

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Texas San Antonio Houston Dallas 90

The Startup Lawyer

FEBRUARY 4, 2011

As equity in the company tends to be the currency of early stage startups, the startup should have a good foundation for assigning value in terms of equity. This advice holds true for even if the incubator’s program provides tangible items free and such items have an assigned monetary value. Conclusion.

Incubator 105

Incubator Pre-Money Valuation Option Pool Advisory Board 105

Berkonomics

NOVEMBER 23, 2023

Here is the warning: The execution of equity allocations and of a good incentive program using equity is often mismanaged, damaging the corporate capitalization structure and even affecting the outcome of subsequent investment into the company. … An option plan should carve out an addition of about 15% of the “fully diluted” shares.

Equity 62

Equity Stock Options Vesting Early Stage 62

www.startupnorth.ca

OCTOBER 23, 2010

But for every founder, there is an early employee that takes near equal risks in joining an early-stage company. Remember the goal is to incent early employees to have an emotional ownership of the product and company they are building. Darmesh Shah has a great list of insights for employees joining early stage companies.

Employee 41

Employee Founder Salary Equity 41

Professor VC

JANUARY 17, 2008

I guess you can make the argument that the founders keep more of the company under the take angel money at a $1M pre-money valuation, but the stars need to be aligned and it is much more likely that initial VC funding in the angel scenario would be at a lower valuation with significantly more dilution. Labels: angel groups , valuation.

Pre-Money Valuation 28

Pre-Money Valuation Angel Investor Angel Groups Valuation 28

Berkonomics

MAY 12, 2010

An option plan should carve out an addition of about 15% of the “fully diluted” shares. If there are 85,000 shares issued to the founders, then a plan calling for 15,000 shares in a pool reserved for future hires is appropriate, making the fully diluted shares 100,000. There are some rules.

Early Stage 85

Early Stage Equity Stock Options Vesting 85

dondodge.typepad.com

JANUARY 15, 2011

Entrepreneurs face some pretty tough questions at a very early stage. How much equity should I grant to early employees? The second and third rounds of funding take additional shares of equity and dilute existing investors and founders. Dont worry about giving up too much equity at an early stage.

Equity 40

Equity Employee Dilution Valuation 40

The Next Web

JANUARY 24, 2014

Think of Werner Vogels (CTO of Amazon), Guido van Rossem (founder of Python programming language and senior engineer at Dropbox) or the more senior Gerard Kleisterlee (chairman of Vodafone). According to the Global Entrepreneurship Monitor the Dutch outperform the EU big five in terms of early stage entrepreneurial activity.

Netherlands 143

Netherlands Technical Review Stock Silicon Valley 143

Both Sides of the Table

OCTOBER 17, 2009

So they set up seed programs that allowed for rapid decisions for $500k or less, often done as convertible debt for both speed and cost reasons. I was an early cynic. Many VCs who do lots of seed stage deals are very supportive and active. They do many early-stage deals. There are multiple firms that did this.

Software Review 283

Software Review Term Sheet Due Diligence Southern California 283

Up and Running

SEPTEMBER 20, 2021

Incoming investors make decisions based on the possible dilution of their investments on ownership and often find themselves surprised by overlooked convertible notes. For any (early stage) startup, the team is the most critical asset. Add details of possible dilution when bringing on investors.

Cap Table 112

Cap Table Pre-Money Valuation Stock Options Option Pool 112

The Next Web

OCTOBER 3, 2012

No Bootstrapping Plan : Many startups that come out of an accelerator program (such as YCombinator, Dreamit, or TechStars) simply do not get funding. Here’s the problem: this opportunity doesn’t exist for early-stage startups, because, by definition, they have no users or customers.

Cofounder 155

Cofounder Technical Cofounder Technical Review Software Review 155

The Next Web

AUGUST 19, 2013

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. Being an engineer, I built myself a kind of algorithm that helps determine an early-­stage startup’s sales channels, and that’s what I’m sharing with you today. But, that’s not such a big deal.

Belarus 137

Belarus Viral Channel Startup 137