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. I’m guessing much of this was 101 to many readers.

Metrics 150

Metrics Cost Acquisition Startup 150

Startup Professionals Musings

MARCH 14, 2020

That approach may work for an entrepreneur who just sold a successful business for a huge profit, but it doesn’t work for the rest of us who are not proven successes yet, or don’t even have a business yet. Non-credible funding request or unreasonable valuation. Future unproven projections don’t set today’s valuation.

Due Diligence 308

Due Diligence Intellectual Property Preferred Stock Seed Stage 308

Startup Professionals Musings

DECEMBER 11, 2022

That approach may work for an entrepreneur who just sold a successful business for a huge profit, but it doesn’t work for the rest of us who are not proven successes yet, or don’t even have a business yet. Non-credible funding request or unreasonable valuation. Future unproven projections don’t set today’s valuation.

Due Diligence 271

Due Diligence Intellectual Property Entrepreneur Preferred Stock 271

Steve Blank

APRIL 1, 2020

So here’s a five-day playbook to help CEOs of cash-flow negative startups, or ones about to go negative, assess the new normal and respond with speed and urgency. Your revenue plans are no longer valid. For companies burning cash, such as startups, how much cash do you have? For startups: source of VC money?

South Korea 333

South Korea Salary Business Model China 333

Steve Blank

FEBRUARY 26, 2020

There are two reasons to raise money: You have a killer idea that is only partially validated, that you think can get to $50M+ of revenue in 5 years with 80%+ gross margins (if margins are lower, you need a lot more revenue)and you need money to get to product-market fit, or. Not all startups need outside investment to grow.

Cofounder 429

Cofounder Seed Stage Valuation Metrics 429

Startup Professionals Musings

JUNE 5, 2021

In startup business plans, a bubble is too many entrepreneurs and too many investors chasing the latest “next big thing,” like Google search engine, Facebook social network, or Amazon e-commerce site. In startups, a great success like Google causes busts by stimulating more supply, without regard to demand. High valuation, low profit.

Demand 362

Demand Government Venture Capital Valuation 362

Up and Running

JULY 23, 2014

Startups looking for angel investors or venture capital (VC) absolutely need an exit strategy because investors require it. Exit strategies related to startup funding are quite often misunderstood: The “exit” in exit strategy is for the money, not the startup founders or small business owners. last December.

Exit Strategy 131

Exit Strategy Software Review Angel Investor Startup 131

The Next Web

SEPTEMBER 13, 2013

Thomas Clayton has started and run numerous high-tech startups in Silicon Valley. He is currently CEO of Bubbly , a social media startup backed by Sequoia Capital, SingTel Innov8, and JAFCO. The company is one of the largest VC–backed startups in Southeast Asia, having raised over $60M in funding. Sequoia , Accel , NEA , etc.).

Asia 132

Asia Silicon Valley India Term Sheet 132

Both Sides of the Table

MAY 23, 2012

I have been close to the tech & startup sectors for more than 20 years and I can’t think of a period in which I felt more optimistic about the innovation and value creation I see in front of us. The number of startups being created has increased by an order of magnitude. Thank you, Aaron Sorkin!

Venture Capital 347

Venture Capital Technical Review LP Mobile 347

Hunter Walker

JULY 18, 2022

Why I’m Not Telling Every Startup To ‘Pull The Brakes’ Just Yet. The ‘valuation multiples’ reset also came with an increase in slope of the curve. Your runway is impacted by the absence of projected revenue. A drop in growth rate turns into a drop in valuation multiple. Is This a Tech Recession or a General Recession?

Valuation 116

Valuation Cap Table Startup Later Stage 116

Hearpreneur

JANUARY 22, 2023

For example, a startup SaaS company can use a specialized app to create a good product management process and keep track of the project's progress. Positive experiences create emotional value, which keeps customers coming back and makes small businesses stand out from the rest. Thanks to Sean Stevens, Immerse Education ! #5-

Artificial Inteligence 122

Artificial Inteligence Technical Review Entrepreneur Social Media 122

Up and Running

AUGUST 19, 2014

An angel investor is a high net worth individual who invests their own money into startup companies in the hopes of gaining a return on their money. I was the CEO of both startups, so it was my job to pitch to the angels. So what’s going to separate “YOU” from all the rest? Tweet This Tip. “I’m

Angel Investor 161

Angel Investor Technical Review Due Diligence Startup 161

Berkonomics

AUGUST 3, 2023

Some businesses require very little capital and the founder can self-finance the enterprise and retain 100% of its ownership and control from ignition through liquidity event (startup through sale). And even with the significant cost of credit card debt, many entrepreneurs aggressively use existing cards to finance a startup.

Private Equity 118

Private Equity Valuation Cap Table Accredited Investor 118

Lightspeed Venture Partners

OCTOBER 29, 2012

I’m posting my analysis of the most interesting story of Shark Tank season 4 episode 7 over there, and reviewing the rest of the pitches here. The company sought to raise $125,000 for 25% of the comapny, implying a $375,000 pre money valuation. The entrepreneurs dithered for a moment at the valuation.

Pre-Money Valuation 97

Pre-Money Valuation Offshore Valuation Cofounder 97

Startup Professionals Musings

SEPTEMBER 7, 2015

Entrepreneurs often ask me why investors expect financial projections for a new startup even before the product is built and while the market is still being defined. I recently saw a startup projecting $50 million in revenue for the first year. Revenue projections show penetration of target opportunity.

Liquidity Event 120

Liquidity Event Startup Initial Public Offering Equity 120

Steve Blank

SEPTEMBER 14, 2009

Five Quarters of Profitability During the 1980’s and through the mid 1990’s startups going public had to do something that most companies today never heard of – they had to show a track record of increasing revenue and consistent profitability. They taught you about customers, markets and profits.

Silicon Valley 217

Silicon Valley IPO Technical Review Venture Capital 217

Agile VC

MAY 26, 2011

AGILEVC My idle thoughts on tech startups. Salesforce.com is a startup with 76,000 subscribers (over 2.1M I also joke with Reid Hoffman that this was back in the days before he was “Reid” Reid’s an incredible entrepreneur, startup investor, and human being. How to Evaluate Firms for a Seed VC. May 26, 2011.

Term Sheet 178

Term Sheet Silicon Valley Technical Review Social Network 178

www.paulgraham.com

OCTOBER 23, 2010

Want to start a startup? You need three things to create a successful startup: to start withgood people, to make something customers actually want, and to spendas little money as possible. Most startups that fail do it becausethey fail at one of these. Most startups that fail do it becausethey fail at one of these.

Startup 105

Startup Cofounder Software Stock 105

Hippoland

JULY 24, 2016

Valuation is a nebulous topic amongst early stage startups, so I thought I’d really spell it out in detail. In short: Valuations for seed stage companies are fairly arbitrary and driven solely by supply and demand. Your startup’s valuation is not based on a proforma of your revenue.

Seed Stage 48

Seed Stage Valuation Vertical Demand 48

Lightspeed Venture Partners

OCTOBER 7, 2012

They won a design award at a trade show, but have no revenue and no orders. That’s why most entrepreneurs do not make a specific ask on valuation, but wait to hear offers from investors. As Cuban pointed out, this is a “down round” Zomm is seeking $2M for 10% of the company, implying an $18M pre money valuation today.

Technical Review 110

Technical Review Technical Cofounder Valuation Pre-Money Valuation 110

Both Sides of the Table

MAY 6, 2018

As a VC with scores of startups in our portfolio we have ringside seats to many, many fund raising processes plus I had to raise money across about 5 different rounds of capital as an entrepreneur so I’ve developed some thought on the process that I hope can be helpful to some of you before you start. How to talk about valuation 13.

Revenue 236

Revenue Valuation Portfolio Restful 236

Austin Startup

AUGUST 20, 2017

August 20, 2017: This is another in my series of posts all leading up to a book on Startup Decision Making. One of the most common mistakes I see in startups is making decisions that lose sight of the context , including the past, present, and future. Sooner or later everybody in a startup knows what everyone else is getting paid.

Technical Review 48

Technical Review Software Review Cap Table Securities and Exchange Commission 48

Startup Professionals Musings

MARCH 25, 2011

In startup business plans, a bubble is too many entrepreneurs and too many investors chasing the latest “next big thing,” like Google search engine, Facebook social network, or Amazon e-commerce site. In startups, a great success like Google causes busts by stimulating more supply, without regard to demand. High valuation, low profit.

Startup 225

Startup Demand Green Government 225

View from Seed

SEPTEMBER 25, 2019

You can read the rest of the posts in the series by clicking here *. A few potential slides which can be included in the Appendix: Exit Analysis: Not always as important during the early startup stage since an exit event is presumably in the distance away. Other Questions: Every startup is different.

Seed Stage 166

Seed Stage Retention Restful Valuation 166

Startup Professionals Musings

AUGUST 1, 2016

That approach may work for an entrepreneur who just sold a successful business for a huge profit, but it doesn’t work for the rest of us who are not proven successes yet, or don’t even have a business yet. Non-credible funding request or unreasonable valuation. Future unproven projections don’t set today’s valuation.

Due Diligence 120

Due Diligence Intellectual Property Preferred Stock Seed Stage 120

Duct Tape Marketing

FEBRUARY 16, 2023

So we could go, we could spend the rest of our time talking about valuation. 07:47): Well, where are they gonna get the rest of the money and what's that gonna cost them? The reason people pay for goodwill is to avoid the danger and risk of a startup. 20:06): Remember that the valuations based on the cash flow.

Technical Review 80

Technical Review Wisconsin Non-disclosure Agreement Salary 80

Cracking the Code

SEPTEMBER 12, 2021

As the company announces its $530 million Series F at a valuation of $8.5 The rest is history. They were both about to found a different startup, so I didn’t need to convince them to found a company – I just needed to convince them to join mine! The more I talked about this one, the more convinced I was that it was necessary.

Community 62

Community Cofounder Security Open Source 62

betashop.com

OCTOBER 8, 2012

This past week while I was in Tokyo for meetings with potential partners for Fab, I was invited to participate in a panel discussion on startups. All the rest is noise. There’s no time to dicker around at a startup. Startups are hard work. If you are down on someone, the rest of your team will already know. ?.

Technical Review 108

Technical Review Technology Software Review Valuation 108

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. Valuation caps can come into play in settings other than seed-stage convertible note financing rounds. Read on for a fuller explanation.

Valuation 98

Valuation Pre-Money Valuation Merger Vesting 98

Up and Running

JUNE 14, 2017

In both scenarios, it seems that startup venture initiation and idea validation are strictly dependent on the app. To determine the viability of an app or startup idea without building out the full solution, entrepreneurs should: Test potential buyers’ real buying intentions by monitoring their willingness to pay for a beta version.

Technical Review 96

Technical Review Distribution Redemption Demand 96

Startup Professionals Musings

MARCH 20, 2013

In startup business plans, a bubble is too many entrepreneurs and too many investors chasing the latest “next big thing,” like Google search engine, Facebook social network, or Amazon e-commerce site. In startups, a great success like Google causes busts by stimulating more supply, without regard to demand. High valuation, low profit.

Demand 224

Demand Green Finance Government 224

reidhoffman.org

NOVEMBER 12, 2013

It has many stylistic errors — and a few substantive ones, too — that I would now change having learned more, but I realized that it still provides useful insights for entrepreneurs and startup participants outside of the Greylock network, particularly across three areas of interest: how entrepreneurs should approach the pitch process.

Entrepreneur 111

Entrepreneur Revenue Viral Networking 111

Hearpreneur

AUGUST 5, 2020

It helped them to engage already existing customers with the brand and kept the revenues steady. Another pointer is to how much the industry is ready for disruption is the trend of recent HR and Recruitment startups such as Zenefits which reached up to a valuation of a billion dollars after a few years. 16- Coffee.

Technical Review 156

Technical Review Software Review Entrepreneur China 156

Agile VC

OCTOBER 1, 2013

I believe we’re going to look back in 2-5 years and realize that we’ve been in a once a decade boom for internet & software startups. Software revenue trails hardware slightly and ad revenue always takes a couple years to shift, but even here the results are astounding.

IPO 147

IPO Cloud Valuation Mobile 147

Austin Startup

FEBRUARY 12, 2019

We expanded to Houston, San Francisco, New York, and Los Angeles within months, and we were generally doing all the things and seeing all the things that a startup needed to do and see in order to feel good about VC funding prospects. startups with billion-dollar valuations) in recent years. It’s not my goal to bash anyone.

Silicon Valley 48

Silicon Valley Technical Review Venture Capital San Francisco 48

Austin Startup

FEBRUARY 24, 2019

As I mentioned at the beginning of this series/ebook, over the years I’ve noticed that I tend to frequently share certain Lucky7 posts with entrepreneurs we’ve backed , team members at data.world, or other startup investors I know. The rest of the entrepreneur interviews Pat does are very worthwhile listens also. 16 and 23, 2013.

Software Review 48

Software Review Sales Cofounder Analytics 48

This is going to be BIG.

NOVEMBER 7, 2011

"Every investor and entrepreneur knows there is something scary about the current startup economy. At least nine out of ten high-quality angel-funded startups face an unnecessary death, because there is no Series A money to help them survive critical expansion. Valuations. Facebook is doing billions in revenues.

Angel Investor 104

Angel Investor Valuation Startup Revenue 104