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Should Startups Focus on Profitability or Not?

Both Sides of the Table

I find it amusing when a journalist writes an article about a prominent startup (either privately held or preparing for an IPO) and decries that, “They’re not even profitable!” They have have raised $2-3 million, built a product that has some amount of market traction and got to annualized revenues of around $1 million.

Startup 418
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Should Founders Be Allowed to Take Money off the Table?

Both Sides of the Table

At some point, this breaks if their isn’t an exit or IPO. We should end the year with a few million in fully recurring revenue and we’re projected to double next year. But more spend = more viral opps = more revenue down the road. >50% of our revenue in now viral. Probably revenue based.

Founder 329
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What every entrepreneur should know about financing right now

Version One Ventures

More money is flowing in from a new crop of angels, newly wealthy from a number of tech IPOs. If not, revenue from your customers will be your best source of financing. News Angel investor AngelList Bootstrapping funding Seed money Series A round Startup company venture capital' Is your opportunity at least $100M?

Finance 167
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A Year in Review: 2016

Version One Ventures

forward revenue in February 2016 (the low), they appreciated by 6% each month for the following six months. At the same time, seed money is still abundant due to the proliferation of micro VC over the past few years. Of course, upcoming IPOs like Snapchat will bring some added excitement to the industry.

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Should Startups Care About Profitability?

Both Sides of the Table

70–80% of the costs of most startups are employee costs so what you’re really talking about when a company is unprofitable is that they are growing their staff ahead of their revenue. Revenue When I look at an income statement I start by focusing on the revenue line. You need to understand the “quality” of the revenue.

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The Series A crunch is hitting now. Have we even noticed?

pandodaily.com

Meanwhile, the rash of early liquidity and recent IPOs — unsatisfying as they were — gave liquidity to thousands of employees at large companies, and a subset of those made very real money. This time around, there has been an explosion at the early stages, and the very late pre-IPO growth stages. November 29, 2012.

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Why the New Seed Might Be a Bad Seed

This is going to be BIG.

Do you think you make a better return by putting in a ton of money to buy expensive growth equity and maintain 20% or by being in a future IPO at a $15mm pre? in seed money instead of $1.5M You should target 18 to 24 months of runway post Series Seed." Yay, participation trophies! Why not raise $2.5M