Startup Professionals Musings

OCTOBER 13, 2021

It’s easy to say “yes” to one more feature request after another, until the potential for real impact gets diluted. Obsessive sales – must meet revenue goals. Otherwise, your most innovative and disruptive product thinking will be diluted and lost, killing your dream of a better world.

Dilution 334

Dilution Metrics Acquisition Revenue 334

Startup Professionals Musings

DECEMBER 18, 2013

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 and sales chasm. Product development chasm. Another common chasm is never-ending product development.

Entrepreneur 252

Entrepreneur Marketing Technical Review Dilution 252

Startup Professionals Musings

JULY 1, 2022

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Stock Options 343

Stock Options Advisory Board Stock Startup 343

Startup Professionals Musings

NOVEMBER 10, 2012

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 and sales chasm. Product development chasm. Another common chasm is never-ending product development.

Startup 254

Startup Technical Review Dilution Early Stage 254

Startup Professionals Musings

SEPTEMBER 13, 2011

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 and sales chasm. Product development chasm. Another common chasm is never-ending product development.

Marketing 238

Marketing Entrepreneur Technical Review Dilution 238

Startup Professionals Musings

MAY 8, 2022

The downside is loss of control and financial dilution. If you take investor money, expect a push for hockey-stick growth and a liquidity event, like going public (IPO) or sale (M&A), to get the payback. Should you start a company solo or find co-founders to help you? In my view, two heads are always better than one.

Founder 325

Founder Hockey Stick Cofounder Liquidity Event 325

Startup Professionals Musings

AUGUST 27, 2010

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 and sales chasm. Product development chasm. Another common chasm is never-ending product development.

Startup 227

Startup Technical Review Dilution Early Stage 227

Startup Professionals Musings

SEPTEMBER 25, 2019

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Equity 237

Equity Stock Options Advisory Board Stock 237

Startup Professionals Musings

AUGUST 10, 2019

The downside is loss of control and financial dilution. If you take investor money, expect a push for hockey-stick growth and a liquidity event, like going public (IPO) or sale (M&A), to get the payback. Should you start a company solo or find co-founders to help you? In my view, two heads are always better than one.

Hockey Stick 243

Hockey Stick Cofounder Liquidity Event Startup 243

Startup Professionals Musings

MARCH 23, 2014

Stock dilution control. Everyone wants to minimize dilution of shares, so this special clause is common. These have less to do with the type of stock and more to do with who the person is and how strategic they are to the organization.

Stock 256

Stock Vesting Common Stock Founder Vesting 256

Startup Professionals Musings

JANUARY 6, 2021

In reality, too many choices actually dilutes customer interest in your existing market, and makes your job of production, marketing, and support much more complex. Your focus for momentum could be sales, profitability, or number of customers, but trying to keep all possible parameters growing is simply not practical.

Technical Review 400

Technical Review Technical Cofounder Advisory Board Cofounder 400

Startup Professionals Musings

JANUARY 22, 2013

Stock dilution control. Everyone wants to minimize dilution of shares, so this special clause is common. These have less to do with the type of stock and more to do with who the person is and how strategic they are to the organization.

Vesting 245

Vesting Common Stock Stock Founder Vesting 245

Startup Professionals Musings

MAY 18, 2015

Make sure the government waits for a stock sale to collect taxes. This is called stock dilution control. This allows the entrepreneur more influence in controlling dilution of his or her shares, investment terms and acquisition decisions. At that time the original split makes all the difference. In the U.S.,

Stock 120

Stock Vesting Common Stock Founder Vesting 120

Startup Professionals Musings

SEPTEMBER 26, 2015

What they worry about is a whole different set of issues, including how much control they will have over how their money is spent, what will happen when future investors jump in to dilute their position and how they will get some money back if things don’t go according to plan. Terms to prevent equity dilution relative to others.

Term Sheet 120

Term Sheet Demand Preferred Stock Liquidation Preference 120

Startup Professionals Musings

OCTOBER 21, 2017

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Stock 140

Stock Stock Options Advisory Board Startup 140

Startup Professionals Musings

DECEMBER 14, 2014

The downside is loss of control and financial dilution. If you take investor money, expect a push for hockey-stick growth and a liquidity event, like going public (IPO) or sale (M&A), to get the payback. Should you start a company solo or find co-Founders to help you? In my view, two heads are always better than one.

Hockey Stick 268

Hockey Stick Cofounder Entrepreneur Liquidity Event 268

Startup Professionals Musings

OCTOBER 17, 2013

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Stock Options 224

Stock Options Stock Advisory Board Startup 224

Startup Professionals Musings

AUGUST 19, 2017

The downside is loss of control and financial dilution. If you take investor money, expect a push for hockey-stick growth and a liquidity event, like going public (IPO) or sale (M&A), to get the payback. Should you start a company solo or find co-founders to help you? In my view, two heads are always better than one.

Hockey Stick 144

Hockey Stick Cofounder Entrepreneur Liquidity Event 144

Startup Professionals Musings

SEPTEMBER 5, 2016

Don’t let early funding increase risk and dilute your potential. Thus they will insist on a sale or public offering at every opportunity, which will likely force you out. The most critical need for financing will come as you scale initial success, when you need money to cover new inventory, delayed receivables, and location expansion.

Bootstrapping 120

Bootstrapping Entrepreneur Startup Exit Strategy 120

Startup Professionals Musings

JULY 19, 2013

The downside is loss of control and financial dilution. If you take investor money, expect a push for hockey-stick growth and a liquidity event, like going public (IPO) or sale (M&A), to get the payback. Should you start a company solo or find co-Founders to help you? In my view, two heads are always better than one.

Founder 245

Founder Hockey Stick Cofounder Liquidity Event 245

Startup Professionals Musings

SEPTEMBER 22, 2012

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Stock Options 230

Stock Options Stock Advisory Board Startup 230

Startup Professionals Musings

JULY 24, 2011

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Equity 234

Equity Advisory Board Stock Options Stock 234

Startup Professionals Musings

MARCH 29, 2015

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Stock Options 120

Stock Options Stock Advisory Board Startup 120

Startup Professionals Musings

OCTOBER 7, 2010

Everyone wants to minimize dilution of shares, so special clauses are often included. The difference in value between what the founders paid and the fair market value of that stock based on actual sale to outside investors will be characterized as compensation income resulting in what could be significant tax liability to the founders.

Stock 214

Stock Vesting Common Stock Founder Vesting 214

Startup Professionals Musings

JUNE 20, 2010

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Stock 144

Stock Stock Options Advisory Board Startup 144

Startup Professionals Musings

OCTOBER 16, 2021

These are usually characterized as owner-operated, with five employees or less, and less than $250,000 in sales. If you can do one thing well, don't dilute your efforts until you have been turning a large profit over a consistent stretch of time. I see the potential for these to become big business in this entrepreneurial economy.

Entrepreneur 304

Entrepreneur United States Dilution .Net 304

Startup Professionals Musings

APRIL 9, 2016

Avoid adding features for a single customer to close a sale. Features added which have not been evaluated to have general appeal make your product more difficult to support, dilute your development effort for important features and complicate the usability and installability for all customers. Sometimes it pays to say “no.”

Product 120

Product Coder Dilution Agile 120

Startup Professionals Musings

DECEMBER 12, 2018

These are usually characterized as owner-operated, with five employees or less, and less than $250,000 in sales. If you can do one thing well, don't dilute your efforts until you have been turning a large profit over a consistent stretch of time. I see the potential for these to become big business in this entrepreneurial economy.

United States 244

United States Dilution .Net Small Business 244

Startup Professionals Musings

NOVEMBER 9, 2016

These are usually characterized as owner-operated, with five employees or less, and less than $250,000 in sales. If you can do one thing well, don't dilute your efforts until you have been turning a large profit over a consistent stretch of time. I see the potential for these to become big business in this entrepreneurial economy.

United States 242

United States Dilution .Net Small Business 242

Startup Professionals Musings

MAY 27, 2017

Every new business or product owner wants to attract the broadest possible audience, so they are prone to adding more features, multiple sales channels, and appealing to every demographic. With limited resources, you can sell via ecommerce, but it’s much tougher to support retail as well, or hire a direct sales team.

Entrepreneur 159

Entrepreneur Channel Angel Investor Dilution 159

Startup Professionals Musings

MARCH 26, 2013

These are usually characterized as owner-operated, with five employees or less, and less than $250,000 in sales. If you can do one thing well, don't dilute your efforts until you have been turning a large profit over a consistent stretch of time. I see the potential for these to become big business in this entrepreneurial economy.

United States 246

United States Dilution Startup .Net 246

Startup Professionals Musings

FEBRUARY 9, 2012

These are usually characterized as owner-operated, with five employees or less, and less than $250,000 in sales. If you can do one thing well, don't dilute your efforts until you have been turning a large profit over a consistent stretch of time. I see the potential for these to become big business in this entrepreneurial economy.

United States 247

United States Dilution .Net Small Business 247

Startup Professionals Musings

NOVEMBER 21, 2010

These are usually characterized as owner-operated, with five employees or less, and less than $250,000 in sales. If you can do one thing well, don't dilute your efforts until you have been turning a large profit over a consistent stretch of time.

Dilution 259

Dilution Chicago .Net Small Business 259

Startup Professionals Musings

APRIL 23, 2012

Expertise can be marketing, technical, financial, or sales. All partners should never forget that their allocated shares are only the beginning, and will be diluted proportionately when outside funding is later required from angels or venture capitalists. Building a product doesn’t get it distributed and sold.

Intellectual Property 252

Intellectual Property Equity Cofounder CTO Hire 252

Startup Professionals Musings

NOVEMBER 8, 2010

Expertise can be marketing, technical, financial, or sales. All partners should never forget that their allocated shares are only the beginning, and will be diluted proportionately when outside funding is later required from angels or venture capitalists. Building a product doesn’t get it distributed and sold.

Equity 228

Equity Intellectual Property Cofounder CTO Hire 228

Startup Professionals Musings

SEPTEMBER 19, 2016

Lack of focus only confuses customers and dilutes your scarce time and resources. If your comfort zone is relying on gut reactions, it’s time to stretch your understanding of what constitutes customer acquisition cost, margins, pipeline closure rates, and sales ROI. Focus your efforts and prioritize tasks.

Social Network 120

Social Network Dilution Acquisition Metrics 120