Up and Running

SEPTEMBER 19, 2017

When you accept outside money, particularly a private equity (PE) investment, however, that changes. In this article, I’ll provide some personal stories of how investors have navigated the balance between raising private equity capital and not losing control of their startup. Rule 1: Bootstrap until you have a viable product.

Private Equity 94

Private Equity Pre-Money Valuation Equity Startup 94

Up and Running

DECEMBER 1, 2015

Of course, not every equity compensation story is a David Choe Story. If you’re thinking about extending equity to an employee or a vendor (as in the example above), you should know that the topic is multi-faceted. In this article, I’m going to examine: What equity compensation is. Different types of equity compensation.

Equity 60

Equity Employee Stock Options Vesting 60

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. Though RBI will displace some traditional equity VC, its much bigger impact will be to expand the pool of capital available for early-stage entrepreneurs. . So what is Revenue Based Investing?

Revenue 60

Revenue Term Sheet Founder Technical Review 60

David Teten

SEPTEMBER 6, 2018

Most of my research is also relevant to private equity. I thought it would be helpful to compile my past articles in one place. Just as with any company, the most important issue is the team; see “ How to Negotiate a Partner Role at a Venture Capital or Private Equity Firm “ . 3) Raise capital. 6) Due diligence.

Technical Review 60

Technical Review Private Equity Management Cap Table 60

David Teten

SEPTEMBER 6, 2018

Most of my research is also relevant to private equity. I thought it would be helpful to compile my past articles in one place. Just as with any company, the most important issue is the team; see “ How to Negotiate a Partner Role at a Venture Capital or Private Equity Firm “ . 3) Raise capital. 6) Due diligence.

Technical Review 60

Technical Review Private Equity Management Cap Table 60

ConversionXL

JANUARY 18, 2022

In this article, you’ll learn the difference between brand marketing and product marketing, and how to balance both to stand out above the crowd. Both companies offer heaps of resources, from blog articles to webinars. Use brand marketing strategies to build brand equity. Brand vs product marketing: Friends or foe? Image source.

Marketing 110

Marketing Product Audience Equity 110

Startup Professionals Musings

OCTOBER 17, 2022

Venture capitalists (VCs) have long been seen as the top of the pyramid for startup funding sources, but in fact angel investors now fund over twice as many companies, according to a classic Crunchbase article. This can cause early investor dilution, lower ultimate returns or leave the startup stranded.

Angel Investor 342

Angel Investor Venture Capital Silicon Valley Portfolio 342

Both Sides of the Table

SEPTEMBER 29, 2013

It should help some entrepreneurs to better access early-stage capital and should allow some angel investors better access to deal flow. Syndicates can move faster in early-stage deals than rounding up 40 individual investors. I haven’t proof read this article. For starters, what is AngelList Syndicates?

Syndicate 356

Syndicate Syndication Cofounder Early Stage 356

The Startup Magazine

APRIL 17, 2019

In this article, we will cover 5 investing ideas that only an experienced stock trader would give you. It is better to accept what your risk tolerance is at an early stage instead of stranding yourself in a constant cycle of worry further down the line. There is no such thing as too much knowledge! Spread out where you invest.

Stock 92

Stock Early Stage Software Review Equity 92

David Teten

DECEMBER 15, 2018

If you can’t find a banker which will buy such an early-stage company (which is likely), I suggest at least mail directly all the likely acquirers with whom you have an existing relationship. Since your early days, hopefully you kept a list of likely acquirers and made an effort to get to know them. Consider a banker.

Startup 60

Startup Later Stage Technical Review Software Review 60

genylabs.typepad.com

SEPTEMBER 24, 2011

Working for Equity Instead of Cash. has an article on service firms waiving their fees and instead taking equity in their clients. As the article points out, this approach was common during the 90s Interent boom. At the same time I had equity in a company that was in horrible shape with no hope of survival.

Equity 40

Equity Technical Review San Jose Stock 40

Up and Running

NOVEMBER 26, 2018

In this article, we’ll take a quick look at the big picture, and then talk through options for funding. The rare exception is a special case, in which investors know an entrepreneur well and are ready to invest in them at an early stage. Deciding to take on some kind of debt is quite common. Nobody invests in ideas or plans.

SBA 161

SBA Venture Capital Angel Investor Technical Review 161

David Teten

MARCH 28, 2012

This study is effectively a sequel to the study David Teten led with Chris Farmer of General Catalyst on best practices of venture capital and private equity funds in originating new deals , published in Journal of Private Equity , Harvard Business Review , Institutional Investor , etc. Are VCs a different breed of “investors”?

Portfolio 144

Portfolio Private Equity Venture Capital Early Stage 144

YoungUpstarts

OCTOBER 28, 2015

This article highlights their advice on issues ranging from financing to patent trolls: While startups may believe lawyers are too costly, working with one early on avoids potentially serious problems later. They also need to decide whether to structure terms as an equity deal or a convertible security deal. Incorporation.

Convertible Security 100

Convertible Security IP Technical Review Software Review 100

David Teten

AUGUST 19, 2019

This structure offers some of the benefits of traditional equity VC, without some of the negatives of equity VC. I’ve been a traditional equity VC for 8 years, and I’m now researching new business models in venture capital. We don’t have any equity or control over the business….”. “As Key elements: . “We

Revenue 60

Revenue Technical Review Software Review Equity 60

Gust

DECEMBER 1, 2011

When meeting with early stage entrepreneurs for the first time, after reviewing a demo or hearing their pitch, I often ask them to articulate what they’re most focused on building. What: The foundational corporate formation, governance, equity issuance and intellectual property assignment documents. What is a startup really?

IP 114

IP Intellectual Property Equity Liquidity Event 114

David Teten

MAY 14, 2013

I’m giving a talk next month on “ How Private Equity Funds Raise Capital and Source Deals with Social Media” at Terrapinn’s Private Equity Latin America & Real Estate Latin America conference in Miami. I discuss this topic in more depth in an earlier article I wrote. What else do you think I should discuss?

Private Equity 114

Private Equity Social Media Equity Media 114

A Smart Bear: Startups and Marketing for Geeks

FEBRUARY 21, 2011

It’s among the most-asked questions on startup forums, and an issue we’re dealing with right now at WPEngine as we bring on new employees: How do you decide how much equity (shares) to give a new employee or partner? That’s a much tighter range than you had before you started reading this article! What about $Y/mo?&#

Equity 276

Equity Salary Hiring Institutional Investors 276

www.instigatorblog.com

OCTOBER 23, 2010

Changing Equity Structures for Early Startup Employees Tweet Recently someone asked me for advice on how much equity they should give to their early employees. His company had just closed an early round of funding and he wanted to cement the employee relationships. Those first employees will take 0.5-1%

Equity 41

Equity Employee Startup Vesting 41

Startup Professionals Musings

MARCH 1, 2010

After bootstrapping, friends and family are the most common funding sources for early-stage startups. A startup incubator is a company, university, or other organization which provides resources for equity to nurture young companies, helping them to survive and grow during the startup period when they are most vulnerable.

Technical Review 149

Technical Review Bootstrapping Startup Venture Capital 149

www.drowningamerican.com

JUNE 22, 2012

Next → How we Hire for Sweat Equity (Part 2)… Posted on April 7, 2011 by Travis Biziorek. Early Stage Web Start-Up Seeking Developers. A lot of the initial, early risk has been mitigated through our work over the last year. equity in the company. Musings on Life and the American Dream. Post navigation.

Sweat Equity 40

Sweat Equity Equity Hiring Technical Review 40

Scalable Startup

AUGUST 9, 2018

This article is based on my experiences and the typical mistakes I see every week in startup land. This article focuses on the first two options. At this stage you’re essentially selling yourself and your cofounders. You’re less vulnerable, pay less equity for your funding, and you have some very specific things to talk about.

Technical Cofounder 20

Technical Cofounder Silicon Valley Early Stage Cofounder 20

Eric Friedman

JANUARY 23, 2022

I finalized my notes for the ODX Accelerator program, the early stage accelerator I am building at On Deck , and I wanted to summarize here. I love the start of programs, when teams are excited – all at the earliest stages of company creation. What equity you give early stage advisors matters.

Early Stage 78

Early Stage Equity .Net Vesting 78

NZ Entrepreneur

MAY 27, 2019

If you’re scared about giving up on control or equity, then read on. In my opinion, founders or early stage companies should only have a team of two or three people. Get entrepreneur articles by email once a month. You can’t be everywhere, you can’t do everything and eventually you WILL need a team to grow further.

Technical Cofounder 69

Technical Cofounder Cofounder Technical Review Software Review 69

Gust

NOVEMBER 8, 2012

In April 2012, Congress passed the JOBS Act , which authorizes equity crowdfunding and liberalizes some requirements regarding the issuance of securities by privately held companies. Now all eyes are on the SEC as it adopts regulations to implement the new law with the hope that it won’t get tied up in red tape.

Silicon Valley 187

Silicon Valley San Francisco Intellectual Property Accredited Investor 187

Austin Startup

JUNE 27, 2017

If you’re talking to a funding source not listed in this article, it’s important to ask them whether they are writing checks for new investments. Don’t see a firm in this article that should be? Click here if you think we missed any capital sources or some of the data is incorrect.

Venture Capital 54

Venture Capital Austin Texas Private Equity 54

Both Sides of the Table

SEPTEMBER 28, 2014

Plus, most early-stage M&A fails so this isn’t likely a good use of capital for a young company). In that article I linked to I outline the difference between gross margin & net margin. So money spent should add equity value or create IP that eventually will. We want a strong balance sheet (um, ok.

Burn Rate 383

Burn Rate Balance Sheet .Net Valuation 383

Seeing Both Sides

AUGUST 28, 2017

Early stage entrepreneurs will also still likely value experienced advice on company-building from seasoned venture capitalists. In short, token sales allow early stage companies to skip the series B round and beyond. Shift of value from equity holders to token holders. Fuzzy Governance.

Early Stage 20

Early Stage Equity Venture Capital Government 20

Seeing Both Sides

AUGUST 28, 2017

Early stage entrepreneurs will also still likely value experienced advice on company-building from seasoned venture capitalists. In short, token sales allow early stage companies to skip the series B round and beyond. Shift of value from equity holders to token holders. Fuzzy Governance.

Early Stage 20

Early Stage Equity Venture Capital Government 20

View from Seed

SEPTEMBER 14, 2021

Another framing that I found to be helpful when asking this question to myself is Tim Urban’s AI article on WaitButWhy. For context, seed-stage pre-money valuations are up 24% from H1 2020 to H1 2021. Early-stage valuations are up 70%, and late-stage valuations are up 103% (source Pitchbook ).

Valuation 319

Valuation Pre-Money Valuation Distribution Early Stage 319

David Teten

JANUARY 9, 2018

That said, one limitation in early-stage investing particularly is that 2022’s growth sectors probably don’t fit neatly into a vertical we can define today. In a prior life, I served as a consultant to Goldman Sachs Special Situations Group, Carl Icahn’s organization, and some other very large private equity investors.

Venture Capital 60

Venture Capital Private Equity Silicon Valley Differentiation 60

David Teten

JANUARY 9, 2018

That said, one limitation in early-stage investing particularly is that 2022’s growth sectors probably don’t fit neatly into a vertical we can define today. In a prior life, I served as a consultant to Goldman Sachs Special Situations Group, Carl Icahn’s organization, and some other very large private equity investors.

Venture Capital 60

Venture Capital Private Equity Silicon Valley Differentiation 60

View from Seed

SEPTEMBER 14, 2021

Another framing that I found to be helpful when asking this question to myself is Tim Urban’s AI article on WaitButWhy. For context, seed-stage pre-money valuations are up 24% from H1 2020 to H1 2021. Early-stage valuations are up 70%, and late-stage valuations are up 103% (source Pitchbook ).

Valuation 295

Valuation Pre-Money Valuation Distribution Early Stage 295

David Teten

DECEMBER 12, 2017

As a globally focused LP in early stage VC funds, we at Blue Future Partners have observed a growing trend of firms investing substantially in software tools, whether developing proprietary solutions or adopting off the shelf tools. But what tools are they using themselves to automate their own processes?

Early Stage 60

Early Stage Technical Review Software Review Venture Capital 60

The Next Web

AUGUST 26, 2013

Before you start talking to large VCs, find some early stage investors. Stefan Tirtey, Partner at Doughty Hanson Ventures , created this document with Berlin early stage investors. I’ve seen a few businesses where the first investors took huge pieces of equity for very little money. 10-20% for employees.

Management 120

Management Cofounder Startup Bootstrapping 120

Haystack

JULY 8, 2018

I recently shared this article and tweeted this , and I was quite surprised by the thread it triggered and the reaction it generated. So, that’s why I’m writing this short post specifically for 1) employees of early-stage startups and 2) the earliest investors in these startups, who are often themselves new to the entire sector.

Early Stage 95

Early Stage Dilution Private Equity Common Stock 95

Steve Blank

JUNE 11, 2009

Yet for every founder there are 10-20 other employees who take the near-equivalent risks in joining an early-stage company. If you’re not a founder (by choice, timing or temperament,) you may be an early employee or a later stage startup employee. This means you still need to have a resilient personality, and be agile.

Cofounder 229

Cofounder Founder Silicon Valley Technical Cofounder 229