Both Sides of the Table

JUNE 28, 2011

In this three-part series I will explore the ways that the Venture Capital industry has changed over the past 5 years that I would argue are a direct result of changes in the software industry, not the other way around. million in team costs to code, launch, manage, market & sell our software.

Venture Capital 334

Venture Capital Software PHP Open Source 334

Both Sides of the Table

FEBRUARY 15, 2016

There is much talk these days that startup valuations have decreased and may continue to do so and that the amount of time it takes to fund raise may take longer. The earlier the round, the less capital you need and the more reasonable your valuation the less time that is needed generally to raise capital. Only you know.

Burn Rate 150

Burn Rate Cap Table Valuation Software Review 150

Both Sides of the Table

JUNE 22, 2011

In addition to FOMO it is partly driven by massive increase in valuations for earlier-stage companies who raised money at bit seed prices but who still have product risk. million pre-money valuation is now raising $1 million at a $12 million valuation the next investor has nowhere to go but up (or sit out the investment).

Saudi Arabia 309

Saudi Arabia Valuation IPO Technical Review 309

Both Sides of the Table

APRIL 26, 2016

In an eCommerce or Internet Services business it is often the marketing costs (if purchased online) and in an enterprise software company it is often marketing plus enterprise sales reps. Enterprise software companies also should measure CAC even though it, too, is an imprecise science. This is how much you spend to get a new customer.

Metrics 150

Metrics Cost Acquisition Startup 150

Both Sides of the Table

AUGUST 14, 2009

I’m a software guy so I’m sure there are cases where building isn’t feasible. If you’re three s -hot kids from Stanford, Caltech or MIT you might be able to push valuation higher. Because I believe that getting the best possible angels around the table is far more important than ultimate valuation.

Silicon Valley 291

Silicon Valley Ireland Technical Review Valuation 291

Both Sides of the Table

AUGUST 23, 2010

Only later did I realize that this was part of Dharmesh Shah’s larger blog and that the software was based on the popular “stack overflow&# software. I felt that the Stack Overflow software made it much more obvious what I was supposed to do when I arrived. articles and leaves. No, really.

Silicon Valley 301

Silicon Valley Pre-Money Valuation Technical Review Software Review 301

Both Sides of the Table

APRIL 21, 2020

Nobody will be immune because in a bull market executives are paid to “innovate” so they sign software contracts and run projects. It takes time to sell in your software, get it implemented, prove the value, build a business case, gain executive support and then roll it out more broadly. What Do You Need to Prove to Raise an A Round?

Marketing 263

Marketing Valuation Churn Rate Balance Sheet 263

Both Sides of the Table

NOVEMBER 14, 2017

He came to work in our offices at Upfront Ventures as an EIR and immediately began building software to improve how storage was picked up, photographed, scanned and routed to a warehouse. Sam began drawing out plans for a new way to provide storage after he had horrific experiences with traditional storage after the storm.

Operations 286

Operations New York City Technical Review Startup 286

Both Sides of the Table

JANUARY 22, 2014

Traditional software vs. SaaS. I’ve watched VCs help with valuation support (spreadsheets, comps) on next round financing, participate in M&A meetings, interview senior job candidates – even help terminate tricky senior hires. Think of web vs. mobile. SEO marketing vs. social marketing.

Portfolio 364

Portfolio Chicago Sales Incubator 364

Both Sides of the Table

MAY 14, 2015

THIS is how absurd things have gotten: “I have to raise at a billion-dollar valuation” “Why? You don’t have the revenue or profit to support that valuation.” Marc Andreessen will forever be remembered for “ software is eating the world.” Since of course software isn’t dead.

Valuation 150

Valuation Silicon Valley Non-Compete Software 150

Both Sides of the Table

OCTOBER 1, 2009

This has a tangible impact on the valuation of start-ups and the pace of investment. In the first post in this three part series I described why I believe the VC market froze between September 2008 – April 2009. Bad stock markets mean less IPO’s and lower prices for M&A.

Technical Review 269

Technical Review Stock Hawaii Early Stage 269

Both Sides of the Table

AUGUST 24, 2015

So why invest in that period of uncertainty unless it’s early-stage and thus valuation matters less. You might also favor a quicker close at a slightly lower valuation than you had hoped in order to decrease risk. If you think that public market valuations have NO impact on private market fundings you’re fooling yourself.

Stock 150

Stock Finance Marketing Valuation 150

Both Sides of the Table

MAY 6, 2018

Let’s say you have built a SaaS company where a large part of the early revenue comes from a few big customers or a large part of the revenue is services based vs. software based. How to talk about valuation 13. Let me give you an example. the most counter-intuitive fund-raising advice you’ll get 8. Why “no” is ok in fund raising 9.

Revenue 236

Revenue Valuation Portfolio Restful 236

Both Sides of the Table

FEBRUARY 27, 2019

The law firm has done its job of preparing the stock option requests, board meeting minutes, 409a valuations. Create a Short Strategy / Discussion Deck Create a 5–10 page presentation in your favorite presentation software on any key issues you are grappling with. The meeting starts. The agenda should be purposeful.

Stock Options 226

Stock Options Metrics Stock Valuation 226

Both Sides of the Table

JUNE 1, 2011

If you take a snapshot during an extraordinary surge in valuations, M&A activity, IPOs and thus wealth creation you’d echo John Doerr’s famous quote from 1999 that, “The Internet is the greatest legal creation of wealth in history.&# That’s how it felt then and a bit how it feels in May 2011.

IPO 391

IPO Finance Valuation Naming 391

Both Sides of the Table

JULY 1, 2015

Startup companies continue to grow at unprecedented rates, raise enormous amounts of venture capital and achieve valuations that imply that they will continue to grow rapidly for the foreseeable future. My cautionary tale here is that we’re in the phase of the market where every corporate buyer of software is being paid to innovate.

Balance Sheet 150

Balance Sheet eCommerce Venture Capital Acquisition 150

Both Sides of the Table

JUNE 11, 2015

He’s had a ton of recent successes in enterprise software investments but also has a history in doing consumer deals. In fact, last time I grabbed a beer with Matt he mentioned that he had active investments now worth over a billion in valuation. What did I learn in working with Matt? He’s committed. NextPlus is in LA.

Silicon Valley 150

Silicon Valley Los Angeles San Francisco Architecture 150

Both Sides of the Table

APRIL 25, 2011

“How much is that software really worth? We were building a VC backed software business so I had to focus on the product business. They get “product business envy&# because they read too much TechCrunch about their product brethren raising money at crazy valuations and getting sold at even crazier ones.

Silicon Valley 332

Silicon Valley IP Dividend Finance 332

Both Sides of the Table

MARCH 6, 2015

If you want to understand the software trend that drove the creation of the seed-stage VC phenomenon I wrote about it that linked blog post but in short: cloud computing drove down the cost to create startups enabling a new category of investor. There was Ron Conway (SV Angel) – I think there was always Ron Conway! But not many others.

Seed Stage 150

Seed Stage Silicon Valley Syndicate Syndication 150

Both Sides of the Table

MAY 24, 2021

This is true in consumer but it’s also true in enterprise software. Case in point, Procore just went public and is trading at an $11 billion valuation. sold to Disney for $670 million and since our first investment was at < $10 million valuation we did quite well. This “overnight success” was first financed in 2004.

Venture Capital 363

Venture Capital LP Valuation Later Stage 363

Both Sides of the Table

JULY 26, 2022

Photo by Scott Clark for Upfront Ventures Focus on Cash While the headlines in 2020 & 2021 touted many massive fundraising events and heady valuations, we believed that for savvy investors it also represented an opportunity for real financial gains. How do we plan to do it?

San Francisco 408

San Francisco Early Stage Venture Capital Los Angeles 408

Both Sides of the Table

MARCH 1, 2011

The secret to the software sales process. Advice on startups raising capital: if you raise your first round at a super high valuation and don’t grow into your valuation, it makes it very hard to live for the long game.

Semantic 302

Semantic Acquisition Valuation Angel Investor 302

Both Sides of the Table

OCTOBER 15, 2009

One the one hand I feel great because we went out and built software that solved an industry problem. Back to BuildOnline, following the staggering decline in public market valuations throughout 2000 we were forced to cut our staff dramatically going from 92 employees to 38 in just one day (and down to 33 a month later).

Founder 299

Founder Technical Review Startup Venture Capital 299

Both Sides of the Table

MAY 23, 2012

If you want to understand the details of why this is, I covered it in detail in this post, Understanding Changes in the Software Industry. Yes, it’s true that FOMO (fear of missing out) is driving some irrational behavior and valuations amongst uber competitive deals and well-financed VCs.

Venture Capital 347

Venture Capital Technical Review LP Mobile 347

Both Sides of the Table

AUGUST 17, 2009

Assuming normal valuations at fund raising rounds you’ll be down to 6-12% after you’ve created a stock-option pool and raised capital. It you have a great software engineer that’s awesome. They have developers or friends help code their software without having legal agreements in place.

Founder Vesting 365

Founder Vesting Intellectual Property Stock Options IP 365

Both Sides of the Table

APRIL 3, 2010

Third, he notes that even if they do invest they’re likely to do so at a lower price because you can’t truly get an independent valuation. We had to buy expensive Sun servers, Oracle databases, Unix licenses and build complex software. .&# This is true and does happen. I’m sure this happens, too.

Venture Capital 265

Venture Capital Term Sheet Early Stage Silicon Valley 265

Both Sides of the Table

DECEMBER 5, 2010

Was it massively better software, better companies, better markets? MySpace would liked to have owned YouTube but didn’t have the public stock valuation to purchase them at the price that Google did. Third-party software companies will start to offer features to websites to actually drive social features. The Present Era.

Social Network 318

Social Network Networking Internet Technical Review 318

Both Sides of the Table

MARCH 30, 2016

Investors had grown too used to the idea that any deal you funded would get marked up to a higher valuation in the next round and that’s clearly not always true. Mutual funds had begun marking down the valuations of their private investments in high-profile deals. Fall turned to winter. 2015 turned to 2016. FOMO was NOMO.

Balance Sheet 150

Balance Sheet Burn Rate Valuation Forecast 150

Both Sides of the Table

OCTOBER 19, 2010

If you’re an OEM who wants to move more hardware but you don’t have the muscle to create an entire media ecosystem then you’re best off finding a partner who can build a software OS, app platform and search capabilities. and Excite in particular as well as all of the Internet companies with grandiose stock market valuations.

Distribution 386

Distribution Audience Video Internet 386

Both Sides of the Table

FEBRUARY 12, 2017

(there’s a great story from Jonah in the video but you have to watch to hear it :)) But it’s undeniable that it has become a digital media powerhouse having raised around $500 million in capital with a valuation reported at $1.7 An obvious vector for me would be software for the media industry.

Media 210

Media Los Angeles Russia Viral 210