Startup Professionals Musings

MAY 22, 2020

Most founders like to talk about their many months or years of sweat-equity , but cash invested is a stronger commitment. If the company has been around for more than a couple of years, and still has no product or revenue flow, there better be a good explanation. When did this effort really start, including pivots?

Technical Review 436

Technical Review Due Diligence Sweat Equity Burn Rate 436

Startup Professionals Musings

OCTOBER 16, 2022

Often the Boomer is more willing to work for equity, and easily convinced to step aside when revenues reach that next threshold. For aspiring new entrepreneurs of any age, this is an opportunity for a win-win situation, with the proper mix of Boomers with Gen-X and Gen-Y employees and executives. Member of the Advisory Board.

Advisory Board 368

Advisory Board Dividend Angel Investor Cofounder 368

VC Cafe

FEBRUARY 27, 2024

especially if the startup already has a product and revenue? In smaller funds, ticket sizes tend to be lower, so pre-seed is the only stage where micro funds are able to secure their minimum equity targets. A founder asked me what makes a $2M round “pre-seed”?

Valuation 186

Valuation Software Review Generative AI Technical Review 186

Startup Professionals Musings

FEBRUARY 18, 2023

Most founders like to talk about their many months or years of sweat-equity , but cash invested is a stronger commitment. If the company has been around for more than a couple of years, and still has no product or revenue flow, there better be a good explanation. When did this effort really start, including pivots?

Sweat Equity 207

Sweat Equity Burn Rate Technical Review Intellectual Property 207

ReadWriteStart

DECEMBER 15, 2022

Client work serves as an additional source of revenue to form new startups. This outside work provides a valuable source of revenue able to be used to fund operations. Over time, this revenue reduces the dependency on outside venture capital sources. Keep Employees Engaged When on The Bench.

Incubator 188

Incubator Startup Software Developers Software Development 188

A Smart Bear: Startups and Marketing for Geeks

JANUARY 4, 2018

Late last year we passed $100M in annual recurring revenue. That revenue is in on 75,000 customers, earned through the hard work of 500 employees across six offices on three continents. This week we closed $250M in financing from Silver Lake , the premier technology private equity firm.

Engineer 152

Engineer Revenue San Francisco Security 152

Berkonomics

DECEMBER 17, 2020

Let’s take a few minutes to examine the kind of equity financing available to small or early stage businesses. In most cases, these applicants for equity funding must be rooted in technology to apply to this limited discussion. The post When should you go for equity financing? Friends and family investors. Venture farms.

Equity 62

Equity Finance Liquidity Event Angel Groups 62

YoungUpstarts

JANUARY 10, 2020

When it occurs, the consequences can be swift and devastating, wreaking potential havoc on a once steady stream of revenue. The loss of these major customers can have a dramatic impact on both internal (employees) and external contributors (investors). In many cases, this scenario is inevitable and difficult to prevent.

Customer 347

Customer Development Team Review Advisory Board Private Equity 347

www.avc.com

SEPTEMBER 22, 2011

Employee Equity: How Much? The most common comment in this long and complicated MBA Mondays series on Employee Equity is the question of how much equity should you grant when you make a hire. And the amount of equity you need to grant to accomplish these hires is also an art and most certainly not a science.

Equity 64

Equity Employee CTO Hire Fractional CTO 64

David Teten

MARCH 14, 2018

Sophisticated VC and private equity funds have a wide array of options for leveraging outside operating executives. Andreessen Horowitz’s compromise: they have a half-dozen “ board partners ” who serve on the boards of their portfolio companies, representing A16Z, but who are not full-time employees of A16Z.

Private Equity 60

Private Equity Venture Capital Equity Cofounder 60

Startup Professionals Musings

SEPTEMBER 29, 2018

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. That should equate to an adequate valuation for a $2 million follow-on Series-A round, without giving away all the equity.

Burn Rate 223

Burn Rate Hockey Stick Startup Salary 223

Startup Professionals Musings

JANUARY 18, 2020

Often the Boomer is more willing to work for equity, and easily convinced to step aside when revenues reach that next threshold. For aspiring new entrepreneurs of any age, this is an opportunity for a win-win situation, with the proper mix of Boomers with Gen-X and Gen-Y employees and executives. Member of the Advisory Board.

Advisory Board 312

Advisory Board Startup Dividend Angel Investor 312

Feld Thoughts

OCTOBER 28, 2011

While Jane was building SayAhh’s revenue projections , Dick focused his attention on building the expense side of the projections. It is simple in that it forecasts how much cash will be coming in the door (revenues + equity financing + debt financing) and then subtracts from that amount how much cash is expected to be going out the door.

Revenue 127

Revenue Balance Sheet Forecast Software Review 127

Austin Startup

MAY 8, 2018

Background reading: Founder Compensation: Cash, Equity, Liquidity Fatal Errors in Early Startup Hiring Early Hires: Options or Stock Given how deeply involved we are with early-stage startups hiring their first key employees, I figured it would be helpful to outline a few key principles to help entrepreneurs navigate the topic.

Employee 48

Employee Seed Stage Startup Equity 48

The Startup Magazine

AUGUST 11, 2023

This could be a proportion of the company’s equity or investment; in other instances, it could be a portion of its later-stage profits. Seed venture capital firms can make more significant follow-on investments to keep or increase their equity stake in the company. How does the funding for the seed stage work?

Seed Stage 126

Seed Stage Technical Review Early Stage Due Diligence 126

ReadWriteStart

JANUARY 28, 2022

With the rise of startups and growing businesses , it has become more critical for investors to have a thorough understanding of equity to be aware of all of the advantages they are receiving from the companies they have invested in. What is Company Equity? Types of equity. Common stock. Preferred shares.

Valuation 108

Valuation Equity Warrant Common Stock 108

Steve Blank

APRIL 1, 2020

Your revenue plans are no longer valid. What’s your monthly cash burn at your new low revenue level? The CEO should dial through as many of the largest existing customers to get a firsthand understanding of the magnitude of any revenue shortfall. Award equity to employees equal to the value of their reduced salaries.

South Korea 333

South Korea Salary Business Model China 333

David Teten

SEPTEMBER 23, 2017

Private equity and venture capital investors are copying our sisters in the hedge fund and mutual fund world: we’re trying to automate more of our job. High-frequency trading, algorithmic by its nature, is estimated to account for at least 50% of US equity markets trading volume. . But we’re doing it slowly.

Private Equity 60

Private Equity Venture Capital Equity Technical Review 60

Startup Professionals Musings

OCTOBER 5, 2014

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. That should equate to an adequate valuation for a $2 million follow-on Series-A round, without giving away all the equity.

Burn Rate 262

Burn Rate Hockey Stick Entrepreneur Salary 262

YoungUpstarts

MARCH 4, 2019

Balancing Assets, Liabilities, and Owner’s Equity. Equity indicates what those with a stake in the company can claim as their own (even if your business “owns” a piece of equipment, for example, this is still considered an asset and not equity). Income Statement: Income = Revenues – Expenses. Making Choices.

Balance Sheet 172

Balance Sheet Software Review Equity Cofounder 172

Gust

MAY 24, 2012

As a quick review, most startups begin life as corporations with a single class of equity securities, referred to as Common Stock , issued to founders, employees, and outside service providers. Options and warrants, when issued, are also typically exercisable for shares of Common Stock.

IPO 159

IPO Equity Common Stock Stock 159

Both Sides of the Table

MAY 27, 2013

In his tenure as CEO of DataSift we have never missed a monthly revenue figure. He has grown our US operations from 1 employee (him) to a global organization of 75 employees that will finish the year with 8-digit revenues (90+% recurring) and more than 350% year-over-year growth. And by now we all consider him a friend.

Advisory Board 365

Advisory Board CTO Hire Fractional CTO Los Angeles 365

ConversionXL

JANUARY 18, 2022

It partners with sales to close more revenue, informs product teams to deliver better products, and in some cases, co-owns demand generation activities with marketing teams. Founder Nathan Barry launched in 2013 to help creators sell their books and courses but failed to meet revenue goals and eventually stalled.

Marketing 110

Marketing Product Audience Equity 110

Startup Professionals Musings

JUNE 23, 2023

The failure rate is just too high, and startups typically don’t have the assets or revenue stream to back up the loan. That’s why angel and equity investors are so sought after by entrepreneurs. Demonstrate an ability to repay from revenues, not collateral. The more conservative ask for two years of positive cash flow.

Silicon Valley 292

Silicon Valley CPA Small Business Administration Startup 292

Hearpreneur

JANUARY 1, 2023

As I've taken the time to invest in companies and programs that can manage various facets of my business on my behalf, I've been able to increase my revenue and provide better financial insulation for my firm to help it withstand the negative effects of a recession. Our teams and employees are our biggest support during an economic downturn.

Entrepreneur 92

Entrepreneur Software Review Technical Review Revenue 92

ReadWriteStart

MAY 30, 2022

Sometime in your future, an investor will offer you money in return for equity. Then you need to retain the lion’s share of equity. Your employees and cofounders deserve their stakes since they’ve helped you scale to an exit. The more people you grant equity to, the more complex your payday. Will you be ready?

Bootstrapping 147

Bootstrapping Startup Equity Silicon Valley 147

Startup Professionals Musings

SEPTEMBER 14, 2016

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. That should equate to an adequate valuation for a $2 million follow-on Series-A round, without giving away all the equity.

Burn Rate 120

Burn Rate Hockey Stick Startup Salary 120

Startup Professionals Musings

NOVEMBER 21, 2016

Even non-profits need money to scale, but their pitch should be to philanthropists, not equity investors. This may work for a year or two, until you grow to need employees with benefits, facilities, and more complex processes. Declare a $10 million valuation with no revenue or customers.

Intellectual Property 120

Intellectual Property Valuation Technical Review Equity 120

Hearpreneur

DECEMBER 10, 2023

It could be more revenue, hiring clients, or launching a new product or service, but every new year is an exciting time because it’s ripe with opportunity. 12- To diversify revenue streams Photo Credit: Mangla Sachdev In 2024 , my top priority is crafting an income engine that generates multiple streams of revenue.

Technical Review 136

Technical Review Entrepreneur Artificial Inteligence Affiliate 136

VC Cafe

SEPTEMBER 26, 2022

A combination of competition for top talent and an effort to bring employees back to the office drove startups in Israel to throw extravagant parties and all-inclusive retreats abroad. The press took notice, especially since just a few months later startups were laying off employees en-masse to cut costs. Team, product, market.

Founder 187

Founder Startup Valuation Pre-Money Valuation 187

Up and Running

SEPTEMBER 19, 2017

When you accept outside money, particularly a private equity (PE) investment, however, that changes. In this article, I’ll provide some personal stories of how investors have navigated the balance between raising private equity capital and not losing control of their startup. You make all the decisions, when you want, how you want.

Private Equity 94

Private Equity Pre-Money Valuation Equity Startup 94

discuss.joelonsoftware.com

NOVEMBER 1, 2010

where I can learn about how to build a sweat equity team? Right now, my business is just myself and a part-time employee who does support, testing, and product usability design. Rather, it is a proposal for sweat-equity investors. Equity partners need to have a hand in guiding the enterprise. The gist: 1.

Sweat Equity 40

Sweat Equity Equity Angel Investor Affiliate 40

The Startup Magazine

OCTOBER 26, 2020

Equity agreements and powers of attorney. In particular, pay close attention to the revenues from these customers. Employee or management issues. Franchise and license agreements. Customers and Sales. It’s also important to understand the target company’s customer base. Look at the top 20 customers of that company. Other Areas.

Technical Review 91

Technical Review Software Review Due Diligence Merger 91

Startup Professionals Musings

SEPTEMBER 27, 2020

The failure rate is just too high, and startups typically don’t have the assets or revenue stream to back up the loan. That’s why angel and equity investors are so sought after by entrepreneurs. Demonstrate an ability to repay from revenues, not collateral. The more conservative ask for two years of positive cash flow.

Silicon Valley 431

Silicon Valley CPA Small Business Administration SBA 431

YoungUpstarts

DECEMBER 14, 2016

Watch out for complex areas such as accounting for revenue, inventory, contingencies, equity instruments and consolidation. Employees and contractors. If the consultant fails to be a good fit for the company, you simply do not renew the contract — which can be less messy than terminating a permanent employee.

Acquisition 100

Acquisition Intellectual Property Technical Review Due Diligence 100

Startup Professionals Musings

NOVEMBER 1, 2014

Often the Boomer is more willing to work for equity, and easily convinced to step aside when revenues reach that next threshold. For aspiring new entrepreneurs of any age, this is an opportunity for a win-win situation, with the proper mix of Boomers with Gen-X and Gen-Y employees and executives. Member of the Advisory Board.

Entrepreneur 266

Entrepreneur Advisory Board Dividend Angel Investor 266

Up and Running

JULY 22, 2014

It’s a table that lists all of your revenue streams and all of your expenses—typically for a three-month period—and lists at the very bottom the total amount of net profit or loss. A typical profit and loss statement should include: your revenue (also called sales), followed by. how you make money.

Balance Sheet 148

Balance Sheet Forecast Equity .Net 148