Both Sides of the Table

MAY 28, 2018

He or she wants to know how long the money you will raise will last and whether this is long enough to warrant taking a risk on funding you. This part of a series to help you raise venture capital ?—?the Simply put, a VC wants to evaluate how much cash you’re raising and whether this amount is realistic.

Burn Rate 247

Burn Rate Valuation Pre-Money Valuation Dilution 247

David Teten

JANUARY 19, 2021

Similar to the explosion of seed funds in the past decade, we (and some limited partners too ) believe these Flexible VCs are on the forefront of what will become a major segment of the venture ecosystem. We detail below the major categories of VC: VENTURE CAPITAL TYPOLOGY. FLEXIBLE VC VS. OTHER VENTURE CAPITAL MODELS.

Cofounder 78

Cofounder Technical Review Equity Dividend 78

YoungUpstarts

SEPTEMBER 14, 2020

AI is getting tremendous attention and significant venture capital, but AI tools frequently underwhelm in the trenches. I suggest, however, that the attention might be warranted on its merits. GPT-3 is getting the benefit of that spotlight. Because Not Every Problem Is A Nail.

Technical Review 246

Technical Review Connecticut Algorithm Warrant 246

Both Sides of the Table

APRIL 19, 2011

He tells the story of how he was out of cash, stressed out, nobody in LA or Silicon Valley would give him money, he had finally found an investor in Minneapolis but his venture bank was going to shut him down for breaking a “covenant&# in their agreement by not having enough cash in the bank. The answer? Something so simple.

Acquisition 304

Acquisition Warrant Customer Term Sheet 304

Both Sides of the Table

OCTOBER 11, 2009

Frankly, they don’t have enough skin in the game to warrant the time & energy. Tags: Start-up Advice startup technology vc venture capital. If it takes you a while to get going don’t be surprised if you don’t get the attention you want despite their best intentions. Not enough wisdom. What do you think?

Advisory Board 306

Advisory Board Startup Equity Valuation 306

David Teten

AUGUST 19, 2019

I’ve been a traditional equity VC for 8 years, and I’m now researching new business models in venture capital. I believe that Revenue-Based Investing (“RBI”) VCs are on the forefront of what will become a major segment of the venture ecosystem. Village Capital: Alternative Investment Strategies to Drive Inclusive Innovation.

Revenue 60

Revenue Term Sheet Founder Technical Review 60

Both Sides of the Table

SEPTEMBER 28, 2014

If you were able to raise at a $50 million post-money valuation and have $2 million in the bank and the markets turn you better be sure that your valuation warrants raising at at least $50 million even in a tough market or I’d be more cautious about a higher burn. If you’re raised at $250 million+ valuation even more cautious.

Burn Rate 383

Burn Rate Balance Sheet .Net Valuation 383

Agile VC

OCTOBER 23, 2012

The same is not true for venture capital of course, since the underlying startups VCs invest in aren’t publicly selling their equity. But even though it’s episodic, the ecosystem seems to pay more attention to average VC industry returns than is probably warranted.

LP 176

LP Accredited Investor Carried Interest Portfolio 176

David Teten

AUGUST 19, 2019

I’ve been a traditional equity VC for 8 years, and I’m now researching new business models in venture capital. RBI normally requires founders to pay back their investors with a fixed percentage of revenue until they have finished providing the investor with a fixed return on capital, which they agree upon in advance.

Revenue 60

Revenue Technical Review Software Review Equity 60

Reid Hoffman

JULY 30, 2020

This is why top venture capital firms like Greylock and others are actively investing, especially at the seed and Series A stages. A risky, high-impact decision might warrant more consideration. But this decision window is only a default; smart entrepreneurs modify their decision window based on the context.

Hiring 36

Hiring Warrant Software Review Technical Review 36

www.inc.com

SEPTEMBER 24, 2011

Dave Graham Business Venture Capital Private Equity GlobalLogic Inc. Venture Capital Firms. Equity payments are structured as common stock or as warrants, which give Arizona Bay the right to purchase equity in a clients company at an agreed-upon price at some point in the future. Were not a venture capital firm.".

Arizona 40

Arizona Equity Iowa Venture Capital 40

Both Sides of the Table

MAY 23, 2010

Often when startups who have raised venture capital need another round of financing they will turn to their existing investors to give them money before raising from outsiders. You might have legitimate concerns that warrant not funding the ongoing operations. This bonus is often in the form of either a discount (e.g.

Startup 290

Startup Burn Rate Warrant Bankruptcy 290

Genuine VC

MARCH 16, 2015

Pursuing the underlying data, it’s as you’d expect that most of the rounds raised so far are Seeds and Series As, and many haven’t even raised any meaningful capital at all. And, of course, the larger growth rounds just haven’t happened yet since the startups aren’t mature enough to warrant 8-figure capital raises.

Cofounder 100

Cofounder Stealth Warrant Venture Capital 100

Both Sides of the Table

MARCH 11, 2010

This is part of my ongoing series on Raising Venture Capital. Recently I’ve been debating with a number of young startup companies that are raising money in the next few months, “what is the right about of capital to raise at a startup?&#. It’s a tricky question with no clear answer. There are trade offs.

Venture Capital 319

Venture Capital Startup Silicon Valley Warrant 319

YoungUpstarts

NOVEMBER 11, 2015

Could your offering be deemed cheap or high-quality enough to warrant customers abandoning the existing marketplace? TX Zhuo is a managing partner of Karlin Ventures , an L.A.-based based venture capital firm that focuses on early-stage enterprise software, e-commerce, and marketplaces.

New York City 100

New York City Warrant Chicago Early Stage 100

Up and Running

SEPTEMBER 26, 2016

See Also: 17 Venture Capital Blogs You Should Be Reading. And that’s an important message we want to get across here—before you get into the process of trying to obtain venture debt, understand what the banks are looking for so you don’t waste your time. See Also: What Do Venture Capital Firms Want? No, it’s not.

Covenant 60

Covenant Institutional Investors Balance Sheet Warrant 60

Gust

SEPTEMBER 27, 2014

These can be based on things like location (some only invest in a particular country or state), industry (a Life Science fund is simply not going to invest in a new social network for real estate agents), or valuation (a seed fund will not usually invest in a company that is advanced enough to warrant a $10m pre-money valuation), etc.

Angel Groups 159

Angel Groups Elevator Pitch Software Review Deal Flow 159

Austin Startup

AUGUST 30, 2018

So while the number of dollars pouring into Austin may be increasing, that metric is only favorable to businesses that warrant those sized-rounds. Quake, the venture capital firm I co-founded, is expanding to Austin and will be launching its first cohort in the city this month.

Austin 48

Austin Early Stage San Francisco Later Stage 48

Hearpreneur

JULY 30, 2016

Three major changes could increase their chances of experiencing sustainable growth: access to angel/venture capital, learning effective pricing/negotiation skills and business mentorship. But only around 2% will actually achieve revenues over $1 million dollars. So what could possibly shift and increase their growth?

Technical Review 48

Technical Review Technical Cofounder Entrepreneur CTO Hire 48

Lightspeed Venture Partners

DECEMBER 10, 2012

This is a loan with a 15% warrant attached at a zero strike price. They often do get warrants attached to their loans, but for nowhere near 15% of the company; usually an order of magnitude less. Another source of loans is Venture Debt firms, including Triplepoint , Pinnacle , WTI and many others.

Covenant 156

Covenant Warrant Southern California Los Angeles 156

Startup Company Lawyer

MARCH 14, 2010

If you don’t, please educate yourself on this site, Venture Hacks and the term sheet series by Brad Feld/Jason Mendelson, among other places. If you really want to understand the nuances in venture capital financing documents, please review the NVCA model venture capital financing documents. . under $500K).

Finance 70

Finance Software Review Term Sheet Liquidation Preference 70

Growthink Blog

MAY 21, 2014

There were some great responses to my post last week as to the poor returns experienced by venture capital fund investors. Some suggested that the blame for this lied more with the very difficult market and deal conditions of the past decade than with the VC investment model itself. Investment Flexibility.

San Diego 72

San Diego Warrant IRR Investment Bankers 72

Board Effect

JUNE 10, 2019

This is a prime opportunity to ask if another company finds enough value in your company to warrant giving you advance royalty payments so you can get started and benefit both companies. If you’re interested in more of a partnership, you’ll also find opportunities to work with venture capital partners or local angel investors.

Small Business Administration 70

Small Business Administration SBA Startup Database 70

Gust

SEPTEMBER 17, 2014

Me: So, you raised venture capital? If you want to give them a 50% discount offer them $1 of common-stock warrants (no liquidation preference) for every $1 of stock they buy. If you want to give them a 33% discount you offer them half of a $1 common-stock warrant for every $1 share they purchase. On the phone ….

Liquidation Preference 153

Liquidation Preference Valuation Term Sheet Stock 153

David Teten

MARCH 2, 2013

While I don’t ultimately agree with the article’s conclusions, I think it warrants consideration. I recently had an extensive debate with Tom about why and whether small funds (like mine, ff Venture Capital ) tend to outperform large funds (like his). We thought that you’d be interested in our conversation.

LP 114

LP Securities and Exchange Commission Silicon Valley Venture Capital 114

Both Sides of the Table

SEPTEMBER 11, 2009

But to assume that you don’t need a deck to pull out if asked or if the situation warrants is wrong. Tags: Start-up Advice startup technology vc venture capital. Sometimes this is enough to pry the VC out of their shell and into an active discussion. Again, 90% of communication is non verbal.

Venture Capital 238

Venture Capital Warrant Atlanta Sales 238

Haystack

DECEMBER 18, 2019

4/ Software- and fintech enablement: This is a topic on its own that warrants more investigation.

B2B 90

B2B North America Malaysia Warrant 90

K9 Ventures

MAY 14, 2011

The limited partners may themselves run the gamut from individuals, family offices, venture capital funds to institutional LPs. This now means that they will slowly start behaving less like Angels, and more like institutional venture capital funds. Preferred Stock / Warrants. However, there is a difference.

Preferred Stock 125

Preferred Stock Seed Stage Incubator Early Stage 125

Haystack

DECEMBER 30, 2018

The current President still has a very large and strong base of support, and I do not see that support changing enough to warrant other big changes in 2019. When will the music stop? Everyone thinks we are headed for a downturn. December public market volatility was pretty messy.

Lock-up Period 103

Lock-up Period IPO New York Warrant 103

David Teten

OCTOBER 1, 2015

I’ve seen a range of options for supporting entrepreneurs, which I can rank from least to most involvement in companies by investors: financier VCs, e.g., Correlation Ventures. portfolio operator VCs, e.g., Andreessen Horowitz, ff Venture Capital, First Round Capital, Google Ventures. mentor VCs, e.g., most VCs.

Software Developers 60

Software Developers Software Development Software Review Technical Cofounder 60

Both Sides of the Table

MARCH 3, 2010

The exception in my mind is if the topic of the panel warrants you talking about how your business operates as part of the learning experience. Tags: Entrepreneur Advice Raising Venture Capital Sales & Marketing Advice Start-up Advice Startup Advice. Make sure they know your name, your company and what you do.

Audience 284

Audience Venture Capital Restful Warrant 284

Both Sides of the Table

AUGUST 1, 2010

It’s just that he’s a “super seed&# investor in a firm, Founder Collective , that I really respect (and with whom I’ve done two deals and hope to do a third) and I’m a partner in a venture capital firm, GRP Partners. So we’re bound to frame the issue in slightly different terms.

Post-Money Valuation 298

Post-Money Valuation Term Sheet Warrant Partner 298

Both Sides of the Table

SEPTEMBER 2, 2009

But it is clearly not warranted in all cases. I think the following circumstances warrant consideration, but there is no doubt it is deal specific. Tags: Pitching VCs Start-up Advice VC Industry startup technology vc venture capital. The entrepreneur would be free to “swing for the fences&# with the VC’s.

Founder 329

Founder Liquidation Preference Term Sheet Participating Preferred 329

Austin Startup

MARCH 23, 2017

From the date of its issuance the clock starts, applying constant pressure that can suffocate a company with ever-accruing interest, fixed payment amounts, prepayment penalties, dilutive warrants, or even personal guarantees forced upon the founders (as if they didn’t already have enough skin in the game).

Dilution 54

Dilution Equity Warrant Distribution 54

www.instigatorblog.com

OCTOBER 23, 2010

A standard programmer who writes “generic&# LAMP or C++ is easily replaceable and therefor warrants little ownership unless finding cash to pay a replacement is tight. Early stage funding often bets subsatntial equity because the founders have liitle choices and thus the worth of the investor is really quite high. This is a great post.

Equity 41

Equity Employee Startup Vesting 41

David Teten

MARCH 24, 2011

As a separate topic: Adam commented that he got negative feedback from some investors on Founder Institute’s warrants in his company. We welcome feedback on how we can run the most entrepreneur-friendly angel network.

New York 122

New York Warrant Angel Groups Architecture 122

Professor VC

JULY 25, 2013

Mike Markkula presenting Steve Jobs with first investment in Apple I recently watched an excellent documentary on PBS, Something Ventured: Risk, Reward, and the Original Venture Capitalists. Angel Investors Silicon Valley term sheets venture financing venture capital'

Term Sheet 46

Term Sheet Silicon Valley Syndicate Syndication 46