Both Sides of the Table

APRIL 26, 2016

There has been a lot of public debate over the past several weeks about whether it’s a good thing to be “gross margin positive” or not and commentary always reminds me that some people at startups don’t quite understand financial metrics or even how to think about which ones are healthy. That is what finances rapid growth.

Metrics 150

Metrics Cost Acquisition Startup 150

Both Sides of the Table

JUNE 30, 2016

conversation literally every week with startups. Maybe they worked much of their career running a startup in a sector and years later they want to go after that market again and they know from day 1 what they want to build, why and why it would work or fail. million and in my second company we raised only $500,000 by choice.

Pre-Money Valuation 292

Pre-Money Valuation Valuation Early Stage Startup 292

Both Sides of the Table

NOVEMBER 5, 2014

Last week a company we enthusiastically backed, uBeam , led by a very special entrepreneur, 25-year-old Meredith Perry , announced a $10 million round of financing. Startup Lessons'

Technical Review 417

Technical Review South Korea San Francisco Software Review 417

Both Sides of the Table

SEPTEMBER 22, 2012

I think I’ve read Paul Graham’s post on “ Startup = Growth ” three or four times now. “The growth of a successful startup usually has three phases: There’s an initial period of slow or no growth while the startup tries to figure out what it’s doing. I talked about some of that here.

Silicon Valley 390

Silicon Valley Venture Capital Startup Technical Review 390

Both Sides of the Table

JULY 13, 2013

One of my favorite events last year was attending Startup Grind where I got to interview Clayton Christensen, author of The Innovator’s Dilemma. And of course we talked about many of my views of building startups. I got a job at a bank, and I worked in their corporate finance group. You didn’t join startups then.

Cofounder 337

Cofounder Technical Cofounder San Diego Startup 337

Both Sides of the Table

SEPTEMBER 13, 2011

It’s very common for startup companies to have COO’s. But … Startups don’t need – shouldn’t have – COOs. I have this conversation with every startup that comes to see me and has a CEO & a COO. I think usually a COO title at a startup is an ego thing. CEO’s run things.

Technical Review 325

Technical Review Startup Cofounder Due Diligence 325

Both Sides of the Table

AUGUST 15, 2012

I recently read Brad Feld’s thought provoking piece encouraging founders to sit on the board of another startup company. I found it thought provoking because I’ve always believed startup founders need extreme focus on only their company to succeed. But for now, the summary is: You’ll extend your network. .

Founder 294

Founder Vesting Startup Stock 294

Both Sides of the Table

FEBRUARY 12, 2019

why the hell has seed financing declined so much in the past 3 years?? The reality is that as a result of two major trends the costs of starting a technology startup went down massively. I launched my first startup in 1999 so I know the economics of launching from first-hand experience.

Venture Capital 328

Venture Capital Technical Review Seed Stage IPO 328

Both Sides of the Table

JULY 1, 2010

We all like to think of startups as “non hierarchic&# organizations and to some extent that should be true. I see two common mistakes in companies (not just in startups, in fact). I spent a ton of time with the CEO and VP Finance understanding the businesses, its customers and its operational challenges. Don’t skip.

CTO Hire 308

CTO Hire Management Technical Review Part-Time VPE 308

Both Sides of the Table

JULY 16, 2010

So angel and seed stage investors’ returns will be dependent on good times continuing or on the ability of their portfolio companies to get financed. Importantly, what does this all mean for startups? As I argue in the same video above – startups are better off by the “right sizing&# of the VC industry.

LP 311

LP Technical Review Early Stage Silicon Valley 311

Both Sides of the Table

JUNE 5, 2011

2 preamble issues having read the comments on TC today: 1: I know that the prices of startup companies is much great in Silicon Valley than in smaller towns / less tech focused areas in the US and the US prices higher than many foreign markets. That’s the deal you get when you’re raising in a good market for startup financing.

Pre-Money Valuation 336

Pre-Money Valuation Valuation Silicon Valley Stock 336

Both Sides of the Table

APRIL 20, 2017

Today I’m excited to announce we’ve recently raised $30 million in growth finance led by 8VC , with Kimmy Scotti joining our board. So how did a company that provides storage grow so fast (we’ll exit 2017 with 10’s of millions in recurring revenue), why is it so defensible and is it really a tech startup?

Technical Review 268

Technical Review Los Angeles Software Review Artificial Inteligence 268

Both Sides of the Table

JULY 23, 2014

When you think about the trends of faster-growing startups due to social networking, credit card enable and mobile first consumers – the reality is that many startups are becoming very large financially before needing to go public. The “big boom” in startup financing started around March 2009?—?more

Technical Review 398

Technical Review Venture Capital Valuation Pre-Money Valuation 398

Both Sides of the Table

FEBRUARY 19, 2019

Startups that are backed by professional financial investors almost always have a Board of Directors that consists of some set of founders, investors and sometimes independent directors. It is worth pointing out that there are actually three levels of governance in venture-backed startups. This is often called “corporate governance”?—?in

Startup 204

Startup Dilution Government Stock Options 204

Both Sides of the Table

FEBRUARY 9, 2013

I was sitting with the financing guy who was trying to upsell me everything from pre-paying service to prepaying dent repair coverage, etc. My partner Steven Dietz is an expert on cars (and auto startups having funded DealerTrack , TrueCar , Digital Airstrike , Uparts and others) and I called him and he said, “Decline everything.

Software Review 398

Software Review Technical Review China Mexico 398

Both Sides of the Table

FEBRUARY 25, 2019

Here are some observations I have from this exposure: If a company moves from strength-to-strength with predictable outcomes, easy financings, low staff turn-over, limited competitive threats then the composition of the board probably doesn’t matter as much. This is part of a series on a Board of Directors at a Startup.

LP 269

LP Startup Burn Rate Stock Options 269

Both Sides of the Table

MAY 28, 2018

Conversely many VCs believe that constraining cash can often lead to increases in creative solutions at a startup. Most VCs lead one round of financing in your company and are looking for other VCs to lead subsequent rounds. Will these milestones be enough that a VC would pay a higher price in the next round of financing?

Burn Rate 247

Burn Rate Valuation Pre-Money Valuation Dilution 247

Both Sides of the Table

APRIL 10, 2014

I’d say 20% of startups I see level-up early after their A round. Another obvious hire is thus a financial controller or finance director – preferably somebody with business planning experiences and not just an accountant. The best ones by now have an amazing finance leader who often doubles as head of internal operations.

Startup 381

Startup PR Finance Hiring 381

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OCTOBER 19, 2014

Because the hundreds of millions that it takes to greenlight a theatrical film could never be absorbed by a startup and because they way we experience media & characters has evolved dramatically over the past 20 years to a point where the starting point for media is often digital, gaming or even graphic novel oriented.

Technical Review 373

Technical Review North America Los Angeles Cofounder 373

Both Sides of the Table

MAY 9, 2018

Because you have a unitary focus on financing your company or you die you seem not to miss a beat in thinking about the last meeting and the funder has been whipsawed in 20 directions. I call this the “love decay” and with every passing day it depletes just a little bit more. You’re in control.

Software Review 381

Software Review Churn Rate Due Diligence New York 381

Both Sides of the Table

FEBRUARY 22, 2019

Should You Allow Board Observers on Your Startup Board? Note: This is part of a series on Startup Boards. almost nothing controversial is EVER voted on at a startup board meeting. Note: This is part of a series on Startup Boards. Should You Allow “Board Observers” on Your Startup Board? Types of Board Observers 1.

Strategic Investors 255

Strategic Investors Startup Stock Options Venture Capital 255

Both Sides of the Table

AUGUST 10, 2013

As I’ve said before, all startups need to realize that every other company still has to see itself naked in the mirror in the morning. In my interview I talked about the biggest stress that really comes from startups – dealing with all the other people with whom you work. They are only one aspect of the startup experience.

Startup 412

Startup San Francisco LP Bankruptcy 412

Both Sides of the Table

MAY 4, 2013

As an early-stage investor that is not always aligned with my goal, which I would express as, “pay the right price for the stage & risk in a way that is fair to the founders yet preserves our ability to grow into our valuation at the next financing event.” And I’m seeing this even at some really well run startups.

Deal Flow 347

Deal Flow Early Stage Investment Bankers Technical Review 347

Both Sides of the Table

NOVEMBER 29, 2014

In fact, my salary never caught up with my pre startup salary across 2 companies and 8 years. I will speak with people earning good money at a larger company or even well-financed startup who are mulling over the choice of whether or not to quit. So even after raising a $16 million A-round I still paid myself a paltry salary.

Founder 409

Founder Salary Startup Early Stage 409

Both Sides of the Table

JUNE 19, 2017

How Much Capital You Have Raised / Your Runway In general I recommend that in early-stage startups you try to raise at least 15-18 months of runway. years of cash runway, which is too much for a startup. If you are burning $250k / month then you need $3 million to fund a year or $4.5 million for 18 months.

Burn Rate 212

Burn Rate Startup .Net Venture Capital 212

Both Sides of the Table

MAY 4, 2013

As an early-stage investor that is not always aligned with my goal, which I would express as, “pay the right price for the stage & risk in a way that is fair to the founders yet preserves our ability to grow into our valuation at the next financing event.” Advice to VCs Startup Advice'

Early Stage 361

Early Stage Deal Flow Investment Bankers Technical Review 361

Both Sides of the Table

JANUARY 6, 2014

Over time you start to figure out who you customers are and how to sell to them or how to get them to adopt your products if you’re a consumer-oriented startup. And I’ve also been convinced that it can be quite useful to have another startup company CEO on your board. As You Start to Mature. Experience. Relationships.

Technical Review 325

Technical Review Early Stage Software Review Los Angeles 325

Both Sides of the Table

APRIL 18, 2019

This is only true when: 1) there is funding available to finance short-term losses and 2) when there is a lucrative positive unit-economics business when you become the winner. So for the first year Bird used off-the-shelf scooters that weren’t really built for long-term commercial use.

South America 250

South America Global New York City Software Review 250

Both Sides of the Table

OCTOBER 11, 2016

We then help surround founders with other talent who want to join important causes but don’t have the startup idea themselves. It’s rare to find extraordinarily talented individuals who are natural leaders and who are driven to succeed and who have a passion for startups so when you do you work hard to find opportunities for them.

Venture Capital 150

Venture Capital Fractional CTO Cofounder Early Stage 150

Both Sides of the Table

AUGUST 24, 2015

It will make follow-on financings much harder and people will have to consider whether or not to do inside rounds. These are all normal things but in this big run since 2009 we’ve all gotten used to nearly 100% follow-on financing rates, valuations only moving up, deals clearly the convertible note caps and low mortality rates.

Stock 150

Stock Finance Marketing Valuation 150

Both Sides of the Table

MARCH 21, 2013

I recently wrote a blog post in which I pointed out that many investors & advisors discourage enterprise startups from having a professional services (PS) business and I think this is a big mistake. I think it’s important for enterprise startups to layer in professional services into your revenue stream.

Software Review 321

Software Review Software IP Technical Review 321

Both Sides of the Table

SEPTEMBER 10, 2021

And the loosening of federal monetary policies, particularly in the US, has pushed more dollars into the venture ecosystems at every stage of financing. What Has Changed in Financing? Today you have funders focused exclusively on “Day 0” startups or ones that aren’t even created yet. Of course we can’t.

Pre-Money Valuation 471

Pre-Money Valuation Valuation Venture Capital Early Stage 471

Both Sides of the Table

AUGUST 11, 2021

Photo by Vanna Phon on Unsplash Customer acquisition is the lifeblood of many startups from e-commerce to gaming to marketplace companies, among others. Most of these startups spend the lion’s share of their marketing budget in today’s social media channels: Facebook, Twitter, Reddit, Snap, TikTok and so on because?—?no no surprise?—?that’s

Founder 424

Founder Product Cofounder Acquisition 424

Both Sides of the Table

MAY 2, 2015

You transition from “startup” to real business and it turns out that having an entire team be efficient is more important than that boundless energy but destructive nature of constantly changing direction from the CEO. Great startups have budgets. We brought in Cynthia Stephens to head up finance at Invoca.

Operations 150

Operations Metrics Early Stage Non-Compete 150

Both Sides of the Table

APRIL 28, 2012

When you work inside a startup with lots of clever and motivated staff you’re never short of good ideas that you can implement. It’s a very common occurrence that a young startup with sub 20 staff and sub $2m in financing is racing around doing too many things. Let me explain.

Bandwidth 415

Bandwidth Management Startup Channel 415

Both Sides of the Table

MAY 23, 2010

Often when startups who have raised venture capital need another round of financing they will turn to their existing investors to give them money before raising from outsiders. a loan) that is later converted to equity at the time of the next financing. It starts as a debt instrument (e.g.

Startup 290

Startup Burn Rate Warrant Bankruptcy 290

Both Sides of the Table

JUNE 28, 2018

Until recently it was headquartered 2 blocks from our offices in Santa Monica so we literally saw it emerge under our feet and we proudly invested in the last 3 rounds of financing. Today the company officially announced its most recent round of capital ?—?having having raised $300 million?—?less Ah, but Bird doesn’t have network effects!

San Francisco 256

San Francisco Valuation Technical Review Los Angeles 256