Gust

NOVEMBER 18, 2012

Particularly valuable are recurring revenues, like subscription amounts, that don’t have to be resold every period. In finance, the income approach describes a method of valuing a company using the concepts of the time value of money. Find “comparables” who have received financing (market approach).

Valuation 187

Valuation Pre-Money Valuation NPV Intellectual Property 187

Gust

SEPTEMBER 17, 2014

It’s like we need a finance 101 course for entrepreneurs. Revenue multiple? In finance they call it “terminal value” but the truth is the price is as arbitrary at your A round as it is at your seed round. I really just want to champion Finance 101 to entrepreneurs. There were no metrics. So a convertible note was easier.

Liquidation Preference 153

Liquidation Preference Valuation Term Sheet Stock 153

Gust

JUNE 13, 2012

And if you’re a startup CFO, finance lead, bean counter, or presentation slide deck preparer, then you should read this book. If you’re doing investment pitches, you should read this book. If you’re doing a pitch I’m going to see, I want you to have read this book. Painting with Numbers , by Randall Bolten.

Finance 121

Finance Revenue Sales Startup 121

Gust

DECEMBER 7, 2014

At least wait until later, when you ready to scale, and have some “leverage” based on a proven business model, some real customers, and real revenue. When you put your own financing on the line, your partners, your team, and eventually your customers will know that you are committed to solving their problem.

Bootstrapping 191

Bootstrapping Entrepreneur Startup Burn Rate 191

Gust

NOVEMBER 4, 2011

Entrepreneurs and investors who have spent any time dealing with convertible debt seed financing transactions are likely to have encountered the subject of valuation caps. The cap is irrelevant if the next equity financing is at a valuation below the cap amount.) was spun out, and the valuation was set by that financing round.

Valuation 98

Valuation Pre-Money Valuation Merger Vesting 98

Gust

DECEMBER 8, 2011

Sales contracts accounting for significant revenue. In the case of revenue contracts, they help pay for the related legal work. Employment handbooks and policies. Website terms of use and privacy policies. Office and equipment leases. Strategic partnership or distribution agreements.

Intellectual Property 139

Intellectual Property Non-disclosure Agreement Delaware Stock 139

Gust

DECEMBER 12, 2011

OK, read the next two words slowly: generate revenue. Sorry, yes, I know how retro this sounds. The flocks of angels will fly away, and VCs will hoard cash to finance their existing investments. The only folks who’ll be able to raise money will be those who have a rock solid, proven revenue model that they’re looking to grow.

IPO 70

IPO Social Network Revenue Aggregator 70

Gust

JULY 1, 2012

These people are highly focused on investment areas they know, which have a large opportunity for growth, revenue projection of $20M or more in five years, and a high return that can be realized via an exit within five years. Angel groups almost never supply financing for real estate purchases, or personal loans. Real estate.

Angel Groups 143

Angel Groups Angel Investor Early Stage Startup 143