Both Sides of the Table

JUNE 30, 2011

In the last 90′s it was impossible to charge fair prices for products & services in a market where you had 5 competitors giving away free products to acquire “eyeballs&# and fueled by an excess of venture capital. Hedge funds and growth equity firms returning to their traditional segments of the market.

Venture Capital 289

Venture Capital Early Stage Valuation Angel Investor 289

Both Sides of the Table

JULY 16, 2010

But VC is an “illiquid asset&# so funds didn’t disappear quickly - In 2000/01 the stock market quickly adjusted punishing investors in the NASDAQ and in individual public technology stocks. What accelerated this was the collapse of the public stock markets. VC will shrink. Oh yes it will.

LP 311

LP Technical Review Early Stage Silicon Valley 311

Both Sides of the Table

MAY 28, 2018

Of course the VC is looking to have specificity in how you plan to spend the money you’re going to raise and plans that show a pie chart that says, “25% on marketing, 30% on technology and R&D, 20% on infrastructure, 25% on G&A” do not get funded. Yes, I see plans this pedestrian. You might not like this?—?but

Burn Rate 247

Burn Rate Valuation Pre-Money Valuation Dilution 247

Both Sides of the Table

SEPTEMBER 28, 2014

by Michael Woolf that is worth any startup founder reading to get a sense of perspective on the reality warp that is startup world during a frothy market such as 1997-1999, 2005-2007 or 2012-2014. We’re going to start aggressively spend money on marketing our product. (it is also the title of a fabulous book from Internet 1.0

Burn Rate 383

Burn Rate Balance Sheet .Net Valuation 383

Both Sides of the Table

JANUARY 4, 2014

– while the other might want a quick sale and pocket some bucks while the tech market is hot. Equity for the future? If you are the person staying how resentful will you become working your arse off for equity that your co-founder who leaves will get value from. Those are the easy cases.

Founder 340

Founder Sacramento Cofounder Technical Review 340

Both Sides of the Table

MAY 24, 2018

controlling your psychology ) you no doubt have heard me say that raising capital is a sales & marketing process. If you’ve read any of my ongoing series on fund raising from venture capitalist (episode 1?— ?controlling Building models to evaluate the deal and/or reviewing customer files, company financials, business plans, etc.

Technical Review 314

Technical Review Due Diligence Partner Term Sheet 314

Both Sides of the Table

SEPTEMBER 30, 2011

It’s important enough that I dedicate a tab on my blog to startup sales & marketing. It’s the lifeblood of any organization and yet most startups don’t have any sales DNA on their teams. when is the right time to hire your first sales employee? junior vs. senior? brains vs. relationship? How much to compensate them?

Software Review 300

Software Review Sales Due Diligence Startup 300

Both Sides of the Table

SEPTEMBER 17, 2011

.&# Still, I’ll bet that functionally you divide areas of competence like sales & marketing, product, engineering, biz dev, etc. I usually encourage people to think about titles like, “Founder & CTO&# or “Founder & VP Marketing.&#. Dilute your cash, equity or both. and my favorite].

Operations 292

Operations CTO Hire Startup Early Stage 292

Both Sides of the Table

AUGUST 3, 2010

I can save tons of development time and I think I can buy it for all equity. It meant that the management teams hadn’t figured out a product / market fit for their own businesses. Want to cut prices and go for market share? I’m not saying there are never reasons to buy another company for cash and/or equity.

Merger 276

Merger Technical Review Early Stage Dilution 276

Both Sides of the Table

MARCH 2, 2011

I was thinking back to a few previous “insider baseball&# blog debates that raged for several weeks: AngelGate (aka Bin38 secret cabal), convertible debt vs. equity, bubble vs. not, and now the AngelList discussion. They don’t have market power. Should entrepreneurs have convertible debt or priced equity? Same thing.

Email 287

Email Bankruptcy Equity Technical Review 287

Both Sides of the Table

AUGUST 12, 2010

In the VC & Private Equity world there’s a small number, too, with one of the most respected being PEHub. But there are also going to be those companies that require capex and growth equity (Zynga, Facebook, etc). Losses will come a few years from now and take steam out of the market. Dan also agrees with this.

Seed Stage 232

Seed Stage Valuation Private Equity Venture Capital 232

Both Sides of the Table

JULY 12, 2011

He’s thoughtful about markets, investors, products and is always very well reasoned in his arguments. I commented that this concept may be what has led to the market being overweight in music and restaurant/bar apps, as a lot of young founders have gravitated toward these spaces.

Technical Review 281

Technical Review Artificial Inteligence Cofounder API 281

Both Sides of the Table

JUNE 22, 2011

They have seen one side of a market where many of us have seen the ebb and flow multiple times. Still, market amnesia by ordinarily rational actors always surprises me. I believe a bubble occurs when a market is willing to pay greater than intrinsic value for an asset class. I spoke about a lot of things during the keynote.

Saudi Arabia 309

Saudi Arabia Valuation IPO Technical Review 309

Both Sides of the Table

FEBRUARY 23, 2015

I wrote this conundrum and the need to take charge of how the market define your skills in my much-read blog post on “ personal branding.” ” If you don’t create the message about yourself, the market will. And if you want to be a CEO one day you need the messaging to reflect that. He still has the dream.

Technical Review 150

Technical Review Liquidation Preference Silicon Valley IP 150

Both Sides of the Table

MAY 27, 2013

In this period (less than 2 years) he has brought on incredibly talented senior execs is sales, marketing, product management, client services, finance, vp engineering and more. You may have an opinion on your market-entry strategy for Europe. You may know how much to pay in cash or equity for your new VP Engineering.

Advisory Board 365

Advisory Board CTO Hire Fractional CTO Los Angeles 365

Both Sides of the Table

SEPTEMBER 10, 2021

With the enormous changes to our economies and financial markets?—?how how on Earth could the venture capital market stand still? One of the most common questions I’m asked by people intrigued by but also scared by venture capital and technology markets is some variant of, “Aren’t technology markets way overvalued?

Pre-Money Valuation 471

Pre-Money Valuation Valuation Venture Capital Early Stage 471

Both Sides of the Table

AUGUST 24, 2015

If you didn’t notice that the stock markets in the US dropped nearly 4% today (after falling last Thursday and Friday) then you were probably completely off-the-grid and on vacation. And by this I assume he meant that “market prognosticator twitter” was vomitous. It was a nerve racking morning. Neither do I.

Stock 150

Stock Finance Marketing Valuation 150

Both Sides of the Table

DECEMBER 20, 2009

Trilegiant Corporation , (who is owned by Avis Budget Group (yes, that Avis & Budget), in turn owned by the private equity group Apollo Management ) does business as PrivacyGuard and has engaged in the most unethical of business practices I have come across in years. But I’m also sending this to a couple of class-action lawyers.

Direct Marketing 263

Direct Marketing Private Equity Sacramento Marketing 263

Both Sides of the Table

AUGUST 26, 2010

Let’s say a senior member of your team demanded a pay raise (cash or equity) and you didn’t like the way they approached you. Back when I ran my first company I fought a lot. It seemed the world was always on fire and there was some skirmish to be had. I’d rather choose to be zen and maintain my public reputation.

Demand 340

Demand Equity Reputation Hosting 340

Both Sides of the Table

SEPTEMBER 23, 2010

What is their market traction? Convertible or equity? So is the market really colluding? We discuss things like what the general prices in the market are but not in a price fixing way but in a general commentary way, like “I can’t believe that guy paid 40 pre! How well do you know them? At what valuation?

Entrepreneur 292

Entrepreneur Technical Review Stealth Valuation 292

Both Sides of the Table

MARCH 6, 2010

When I was running startups I felt like a horse with blinders on because I was super focused on the content management market and ignored many other markets. They outline the problems that exist in markets, their approach to the solutions, they update me on competitors and they show me their economic models.

Technical Review 312

Technical Review Due Diligence Spain Warrant 312

Both Sides of the Table

JULY 26, 2015

If you hire somebody with 3 kids and who doesn’t have a lot of savings you’re naturally going to have somebody who cares more about cash than equity even though you REALLY WANT everybody in your company to have the same motivations as you. How will they act if the market tanks? What is the company trying to achieve?

Oauth 150

Oauth Software Review Technical Review IPO 150

Both Sides of the Table

MAY 19, 2010

But truthfully both Dana and I are more aligned with the lean startup principles and believe you only go FAT when you’ve really proved out your product / market fit. The “private sale” market phenomenon was started in France by Vente-Privee (literally means “private sale”) and was replicated in Germany by BrandsforFriends.

Partner 240

Partner New York City Cofounder Syndicate 240

Both Sides of the Table

SEPTEMBER 29, 2013

And of course syndicates unleashes many unintended consequences by creating a new breed of self-promotion amongst angels who previously told you how much they loved their 100 deals because it benefited their equity – now some actually have even more riding as carry – so as always caveat emptor. AngelList does this.

Syndicate 356

Syndicate Syndication Cofounder Early Stage 356

Both Sides of the Table

APRIL 19, 2011

Good listener, take in information, • Have pulse on what the market wants (hard to train that) cannot take this from customers only. If you need money to even hire a developer [means you cannot even excite one person to put in some sweat equity – not a good sign about your ability to motivate people.].

Acquisition 304

Acquisition Warrant Customer Term Sheet 304

Both Sides of the Table

SEPTEMBER 29, 2009

But any entrepreneurs raising capital should keep in mind that this opening of the markets could possibly be temporary. Why did the VC markets freeze so quickly? Market downturn – We all know that investors move in herds. They pre-market their fund raising until one day they announce a first closing).

Burn Rate 263

Burn Rate Valuation Pre-Money Valuation Private Equity 263

Both Sides of the Table

APRIL 28, 2010

Dave’s a great guy with a good sense of humor and a broad knowledge of the market, which is why I was excited that he could be on the show. It is a platform to help brands building viral marketing campaigns. They focus on trying to drive engagbranded social media marketing campaigns (e.g. 4mm in Series A.

Venture Capital 270

Venture Capital Cofounder Spain San Diego 270

Both Sides of the Table

SEPTEMBER 12, 2010

Many of the growth equity firms have had outbound dialing programs for years. Growth equity firms typically target profitable businesses that are often not technical in nature. Perhaps outbound dialing / emailing programs worked well for growth equity firms in their core business. These kind of companies were seldom startups.

Programming 294

Programming Entrepreneur Private Equity Equity 294

Both Sides of the Table

APRIL 6, 2014

CFOs often know the other CFOs and same for heads of sales, marketing, tech, etc. I know that in later-stage growth equity deals some firms even hire third-parties who will do the reference calls. You can ask VCs, customers, competitors or somebody who had a similar job function in the same general community. Having an accomplice.

Technical Review 302

Technical Review Hiring Later Stage Employee 302

Both Sides of the Table

MAY 19, 2018

When you raise money from investors you produce information that you are told they want and care about: A fund-raising deck that articulates your company strategy, plans, team, market, competitors and so forth. So WTF am I supposed to do when an investor asks for access to my data room if I don’t have one?

Cap Table 336

Cap Table Due Diligence Forecast Churn Rate 336

Both Sides of the Table

SEPTEMBER 5, 2012

This time by the efforts of Adeo Ressi to introduce a new kind of structure called “ convertible equity.” My initial reaction to Adeo when we spoke was that while it may have solved some issues (debt versus equity) it didn’t solve the ones that I’ve been warning entrepreneurs about most loudly.

Ratchet 354

Ratchet Liquidation Preference Equity Stock 354

Both Sides of the Table

JUNE 22, 2018

This is especially true because incumbents now know how much is at stake when they let a startup get a huge head start in a market. Let’s say a senior member of your team demanded a pay increase (cash or equity) and you didn’t like the way he or she approached you. then go for it. Back when I ran my first company I fought a lot.

Equity 199

Equity Hosting Demand Cost 199

Both Sides of the Table

JUNE 12, 2013

Todd Gitlin is one of the best executive recruiters the technology & startup market in Los Angeles. On many occasions over the years I’ve called him with a request, “I’m not looking for an X right now but if I were, who is good in the market.” Who cares what my equity is. My philosophy was simple.

Los Angeles 407

Los Angeles PR Networking Partner 407

Both Sides of the Table

OCTOBER 17, 2019

Just as I was getting the swing of things the world shifted beneath my feet and the stock market went into a free fall and venture capital all but shut down for nearly a year. Jason was a creator and saw a market opportunity that others didn’t. Gregg was built to scale large companies and build the processes and team to enable it.

IP 223

IP Intellectual Property IRR Cofounder 223

Both Sides of the Table

SEPTEMBER 18, 2014

It’s simply what a market is willing to pay based on a future belief that your company will grow and non-linear rates and be worth much more in the future. “But lawyers will charge much more for equity.” Try doing THAT with equity. Cashflow projections? I’m not sure. And so forth. Employment.

Venture Capital 417

Venture Capital Liquidation Preference Valuation Term Sheet 417

Both Sides of the Table

JANUARY 1, 2016

But putting no time into anchoring your beliefs because you’re too busy executing sales, marketing, support, product & engineering is an easy recipe for leadership drift. There are always flavors-of-the-month strategies or markets that are in favor in the tech startup world. You don’t have unlimited equity to dole out.

Leadership 150

Leadership Southern California San Diego Hiring 150

Both Sides of the Table

MAY 23, 2010

a loan) that is later converted to equity at the time of the next financing. If no financing happened then this “note&# may not be converted and thus would be senior to the equity of the company in the case of a bankruptcy or asset sale. Maybe the market views this as not worth the price you paid?

Startup 290

Startup Burn Rate Warrant Bankruptcy 290