Both Sides of the Table

FEBRUARY 16, 2017

We felt proud to be the lead investor in Maker Studios at a sub $5 million valuation. And we feel great about the many companies in LA that have now reached serious revenue growth. There will be more enormous successes in Los Angeles and it’s our job to get into enough of these.

IPO 214

IPO Los Angeles Technical Review Silicon Valley 214

Rob Go

SEPTEMBER 4, 2018

In two cases, these businesses were doing significant early revenue ($500K/month+), so could be considered “post-seed”, although both of these companies had not raised significant institutional capital before we led their rounds. Lead investors are few. Leads that are true force-multipliers are exceedingly rare.

North America 36

North America Seed Stage Early Stage Lead Investor 36

View from Seed

SEPTEMBER 23, 2019

In short, sharing pricing expectations early with potential lead investors fundamentally potentially qualifies your conversations, but it also runs the risk of prematurely losing a potential financing partner, or even reduce options to maximize your fundraise outcome.

Cap Table 211

Cap Table Seed Stage Valuation Dilution 211

Both Sides of the Table

FEBRUARY 15, 2016

There are ways to do this politely and even if your investors don’t answer as directly as you may like – there is at least something that can be read into this. If you have mostly angels or don’t feel your existing investor can support you without new capital from the outside then you might want a smaller burn rate.

Burn Rate 150

Burn Rate Cap Table Valuation Software Review 150

David Teten

MARCH 31, 2012

I’m exceptionally excited to announce that I’m now Chairman and lead investor with some other angels in a new company, Spright Governance Inc. The additional revenue earned from taxation on a better-managed state easily allows them to cover such costs. (An aerial view of Parliament House in Singapore. Photo credit: Wikipedia).

Government 154

Government Singapore New York City Non-Compete 154

ReadWriteStart

JULY 18, 2011

Every company has a forecast for how it will get to an arbitrary $100 million in revenue and they all hit it on year five. Unit economics to look at are comparable companies, the lifetime value of a customer, revenue per active daily user, rough acquisition costs per channel (search engine marketing, Facebook campaigns, pay per install).

Investment Bankers 153

Investment Bankers Technical Review Cofounder Due Diligence 153

Pascal's View

JULY 9, 2017

At its core, this issue points to the lack of understanding about the importance of post-money valuation by both entrepreneurs and investors. CEOs and unsophisticated investors very often start anchoring the caps to what they think the company could be worth, all without external validation.

Post-Money Valuation 49

Post-Money Valuation Valuation Cap Table Covenant 49

View from Seed

DECEMBER 6, 2018

This was back in January 2012, a simpler time… when there was only one kind of seed round, when Series A firms invested pre-revenue, etc. So learning which investors are comfortable with concept stage pre-seed vs post-product seed vs small Series A vs big “momentum” A is an important part of qualifying potential investors.

Seed Stage 120

Seed Stage Early Stage Differentiation Lead Investor 120

Hippoland

APRIL 9, 2017

For example, commonly, a lot of entrepreneurs of let’s say marketplace businesses will say they are doing $1m per year in revenue. 3) You act cagey about information Early stage investors understand that there is a lot of work to do in an early stage startup. But, really they mean GMV (in most cases).

Cofounder 48

Cofounder Early Stage Software Review Naming 48

Startup Professionals Musings

FEBRUARY 10, 2012

This is a variation on the first mover argument, implying a paradigm shift that gives you a tremendous lead. Investors will suspect you have a technology looking for a solution. Only our team can make this work.” “We plan to offer it for free, and live off advertising revenue.” This advantage is not sustainable.

Viral 226

Viral Lead Investor Advertising Revenue 226

Startup Professionals Musings

OCTOBER 29, 2010

This is a variation on the first mover argument, implying a paradigm shift that gives you a tremendous lead. Investors will suspect you have a technology looking for a solution. Only our team can make this work.” “We plan to offer it for free, and live off advertising revenue.” This advantage is not sustainable.

Viral 223

Viral Lead Investor Advertising Revenue 223

David Teten

SEPTEMBER 5, 2014

I’ve written on the expert network industry a fair amount in the past: see How to Earn More Consulting Revenue from Expert Networks and How Executives Can Work with Private Equity and Venture Capital Portfolio Companies. GLG Share broadens that resource pool to our 400,000 experts around the world and across industries.

New York 114

New York Technical Review Networking Advisory Board 114

Berkonomics

FEBRUARY 13, 2014

Back when we were all trying to figure out the real value of traffic on the web, we investors – and acquiring companies – got a bit crazy with metrics used to value acquisitions and investments. I am an investor and advisor to one such company. I am an investor and advisor to one such company.

Metrics 83

Metrics Revenue Advertising Internet 83

www.readwriteweb.com

MARCH 7, 2011

Since most companies have little to no revenue, who else has already invested in the deal is heavily weighted to prove value. This, he argues, leads to a herd mentality. The startups and investors can do the round however they like. Follow McCann on Twitter @Mccannatron. Roberts also takes issue with the emphasis on ?social

Technical Review 50

Technical Review Due Diligence Startup Angel Investor 50

Gust

DECEMBER 19, 2011

This is a variation on the first mover argument, implying a paradigm shift that gives you a tremendous lead. Investors will suspect you have a technology looking for a solution. Only our team can make this work.” “We plan to offer it for free, and live off advertising revenue.” This advantage is not sustainable.

Viral 98

Viral Advertising Lead Investor Revenue 98

The Next Web

DECEMBER 4, 2012

million , with its most recent round coming earlier this summer, with the lead investor being iNovia Capital. Sacks says that most of its cash inflow is coming straight from revenue and the company is growing organically. If you want to apply, you have until the end of the year to submit your name for consideration.

Incubator 119

Incubator Engineer Developer San Francisco 119

ithacaVC

JANUARY 14, 2014

It has just started to generate revenue. It expects revenue of $1.7 For example, in this hypo, Company X expects to do $1.7mm of revenue in the coming year. Let’s assume that the Series B investors think that is reasonable. Company X has met its milestones. It has received necessary approvals to sell its device.

Pre-Money Valuation 58

Pre-Money Valuation Post-Money Valuation Valuation Term Sheet 58

ithacaVC

NOVEMBER 14, 2014

Funding lets you invest in growing your company faster than revenue growth would normally allow. For some investors, this is the most important attribute and they won’t invest unless it’s a huge market. Revenue is how traditional businesses get valued. With that said, if you have revenue, this is something you should emphasize.

Valuation 69

Valuation Startup Down Round Early Stage 69

Agile VC

JANUARY 12, 2012

When a startup doesn’t match the stage where a particular investor focuses, founders may get a response along the lines of “This is interesting to us, but come back once you get from X phase to Y phase” That could be from seed stage to a larger Series A financing need, or to progress from pre-product to post-revenue.

Seed Stage 100

Seed Stage Silicon Valley Syndicate Syndication 100

The Equity Kicker

AUGUST 24, 2012

This comes on top of a lot of other negative news, including leading investors selling shares in the companies above at minimal profits, and CalPERS, traditionally one of the largest investors in venture capital, announcing that they have made a terrible 0.0 per cent return on venture over the last ten years.

IPO 101

IPO Valuation Silicon Valley Venture Capital 101

reidhoffman.org

NOVEMBER 12, 2013

we had no revenue. Investors see a lot of pitches. But with so many investors still licking their wounds from the dot-com bust, many focused on proven business models, such as advertising or e-commerce. As a result, we knew that our pitch would need to steer into investors’ biggest concern: the lack of revenue.

Entrepreneur 111

Entrepreneur Revenue Viral Networking 111

Both Sides of the Table

MAY 13, 2018

If you’re raising a round where a new lead investor would invest $5 million the VC fund must have no less than $100 million and if you’re looking for them to write $15–20 million as the lead their fund realistically should be at least $400 million. can I get 20 minutes to swing by” is a good way to engage.

Term Sheet 332

Term Sheet Due Diligence Campaign Sales 332

View from Seed

JANUARY 26, 2016

Just yesterday, for instance, we saw a company raising a seed round that has no product and two founders … and we also saw a company raising a seed with hundreds of thousands of dollars of monthly revenue. These tend to be cases where founders are proven.

Seed Stage 120

Seed Stage Early Stage Cofounder Finance 120

Rob Go

JANUARY 9, 2012

Stage: We are seed investors, but often, the first institutional seed round happens at different stages in the company’s maturity. Post product Pre Revenue: 5. Post Revenue: 4. We pride ourselves in being true early stage investors. Many investors will not invest in a company pre-launch or pre-traction.

Portfolio 46

Portfolio Syndicate Syndication Cofounder 46

Duct Tape Marketing

FEBRUARY 20, 2014

Knowing how much it costs to acquire a customer is debatably the most important variable in an investor’s equation. than investors can use this equation: Cost of getting 100 customers = X. Revenue from 100 customers = Y. Amount of money investor is willing to invest = Z. (Y Y minus X) times Z = total profit.

Kansas City 70

Kansas City Due Diligence Arizona Kansas 70

This is going to be BIG.

AUGUST 2, 2010

So if we’re talking everyone getting funded without getting the benefit of an experienced set of mentors in a small, focused program like TechStars, or a lead investor who will spend a lot of time with you upfront, I’m not on board with that. This is a good thing.

Startup 101

Startup Venture Capital Incubator Programming 101

Reid Hoffman

JANUARY 26, 2021

This is one of the reasons why the best practice for a startup is to raise investment rounds from different lead investors rather than simply doing internal rounds, even if an internal round requires less work. One of the things a financing round brings is an opportunity to strengthen the startup’s overall network. But get real.

Startup 36

Startup Equity Early Stage Green 36

Both Sides of the Table

DECEMBER 18, 2009

But then I got a call from my lead investor (coincidentally it was GRP Partners where I now am a partner) and they told me not to lose confidence. million in recurring revenue of which $600k came from Germany. We started drafting out plans for what we were going to do in order to have an orderly winding up of the company.

Germany 298

Germany Entrepreneur Merger Los Angeles 298

leananalyticsbook.com

AUGUST 19, 2012

That might sound pretty standard, but the variety of revenue models can complicate things. Game startups care about Average Revenue Per User Per Month and Lifetime Average Revenue Per User (ARPUs). Marketers optimizing campaigns to generate traffic and leads. Investors , when we’re trying to raise money.

Metrics 58

Metrics Clickthrough Lean Analytics 58

mashable.com

NOVEMBER 2, 2011

Include screenshots of your product , a video walk-through and one or two charts that display traction or revenue. Look for Your Lead Investor. First you’ll want to find a lead investor — someone many other investors will recognize and respect. This list of top angel investors is a good start.

Social Media 80

Social Media Startup Angel Investor RSS 80

Business Plan Blog

DECEMBER 26, 2013

The individual is likely to be the lead investor in the venture and may join the Board of Directors. This process may include the provision of various scenarios on revenues and costs as the investors validate forecasts initially presented.

Angel Investor 51

Angel Investor Due Diligence Pre-Money Valuation Angel Groups 51

Austin Startup

JUNE 4, 2017

Recently I was fortunate enough to have raised a seed funding round from a fantastic group of investors for my pre-product, pre-revenue B2B SaaS startup here in Austin, Texas. Mark Cuban leads $1.5 Lead Investor : The person or firm who defines the terms of the round.

Austin 54

Austin Institutional Investors Angel Groups Deal Flow 54

Startup Lessons Learned

JUNE 9, 2020

A complete collapse of revenue that simultaneously affects your employees and your customers, your partners, your investors, everyone all at once and all the news is bad. And by the way, we ended up raising $2 billion and the lead investor, Silver Lake. So then what? I have known Brian Chesky for a long time.

Silicon Valley 60

Silicon Valley Hosting Cofounder Employee 60