Steve Blank

MARCH 31, 2014

Companies horde cash and squeeze the most revenue and margin from the money they use. Look at the valuations of companies like Tesla, Illumina, and Twitter. The companies that can show “startup-like” growth rates of 50% plus per year will get stratospheric market valuations.

Private Equity 325

Private Equity Metrics China Business Model 325

Steve Blank

JUNE 15, 2011

A tech bubble is the rapid inflation in the valuation of public and private technology companies that exceeds their fundamental value by a large margin. Today, the signs of the new bubble are the Linked-In initial public offering (IPO), Facebook’s stratospheric valuation and the rapid rise of early-stage startup valuation.

Silicon Valley 327

Silicon Valley Stealth Valuation Mississippi 327

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. There was now a public market for companies with no revenue, no profit and big claims.

Silicon Valley 217

Silicon Valley Technical Review IPO Venture Capital 217

Steve Blank

MARCH 18, 2011

The signals are loud and clear : seed and late stage valuations are getting frothy and wacky, and hiring talent in Silicon Valley is the toughest it has been since the dot.com bubble. VC’s worked with entrepreneurs to build profitable and scalable businesses, with increasing revenue and consistent profitability – quarter after quarter.

Internet 334

Internet IPO Silicon Valley Agile 334

Steve Blank

JUNE 17, 2011

They helped build these struggling ventures into the Facebooks’, Twitters’, and Zyngas’ before anyone else appreciated these companies could have hundreds of millions of users with off-the-chart revenue and profits. Really smart money recognizes it’s a bubble and bets against it.) The question is, are we in a new tech bubble?

Investment Bankers 310

Investment Bankers Stock Valuation Venture Capital 310

Steve Blank

FEBRUARY 10, 2016

Keen Home appeared on the TV show, Shark Tank , in 2012, landing one of the highest valuations in the show’s history. …That’s how you know you have a good team because some people are going to have bad days inevitably and you trust your team members to pick you up. Thankfully my team members always have.

Silicon Valley 120

Silicon Valley Ohio Entrepreneur Columbus 120

Steve Blank

APRIL 1, 2020

Your revenue plans are no longer valid. What’s your monthly cash burn at your new low revenue level? The CEO should dial through as many of the largest existing customers to get a firsthand understanding of the magnitude of any revenue shortfall. Others are cutting their valuations. How many months of cash do you have?

South Korea 333

South Korea Salary Business Model China 333

Steve Blank

MAY 13, 2010

After a bit more discussion, I discovered the “problem in getting traction” meant revenue was zero. In reality, once you think you found the right model, most startups will go through multiple iterations on optimizing revenue and their business model.) We’re in Customer Validation but we can’t seem to close a deal.”

Founder 199

Founder Cofounder Business Model Customer Development 199

Steve Blank

OCTOBER 24, 2017

— Unremarked and unheralded, the balance of power between startup CEOs and their investors has radically changed: IPOs/M&A without a profit (or at times revenue) have become the norm. Typically, this caliber of bankers wouldn’t talk to you unless your company had five profitable quarters of increasing revenue.

Founder 245

Founder Technical Review CTO Hire IPO 245

Steve Blank

JULY 15, 2010

Until 1995 startups going public typically had a track record of revenue and profits. Suddenly there was a public market for companies with limited revenue and no profit. Being acquired has lots of math challenges about your valuation, amount of money raised, percent of founder ownership, type of investor, etc. Lessons Learned.

Venture Capital 297

Venture Capital IPO Liquidity Event Entrepreneur 297

Steve Blank

JANUARY 4, 2010

Now with customers and early revenue, it was out raising its first round of venture money. In fact, Google’s offer for $15 Million was equal to the highest valuation from the venture firms. For its first year IMVU had funded itself with money from friends and family. The question was: what did the founders want to do?

Hockey Stick 276

Hockey Stick Venture Capital Startup Cofounder 276

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. Revenue per customer? Revenue, Gross Margin?

Cofounder 429

Cofounder Seed Stage Valuation Metrics 429

Steve Blank

NOVEMBER 5, 2009

This post describes how companies using the Customer Development model can increase their credibility, valuation and probability of getting a first round of funding by presenting their results in a “Lesson Learned&# venture pitch. Get back up and running.

Customer Development 262

Customer Development Developer Customer Silicon Valley 262

Steve Blank

MAY 9, 2017

Their need to get into high-profile deals has driven late-stage valuations into unicorn territory. Meanwhile every other department in the company would be making their plan – meaning the company was burning cash without bringing in revenue. A unicorn is a startup with a market capitalization north of a billion dollars.

Restful 222

Restful Silicon Valley Puerto Rico San Jose 222