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. Undefined business model or very low gross margins. Surprises during due diligence.

Due Diligence 308

Due Diligence Intellectual Property Preferred Stock Seed Stage 308

Startup Professionals Musings

MAY 27, 2016

That may be an extreme case, but I’ve found that even with the proposals that include compelling paradigm shifts in technology, a hard look at the entrepreneur is often the most significant due-diligence that an investor can undertake. Even social entrepreneurs need milestones, quantifiable results, and revenue to sustain their value.

Technical Review 134

Technical Review Intellectual Property Due Diligence Angel Investor 134

Growthink Blog

DECEMBER 27, 2017

Be prepared for due diligence. It’s critical that the data you present is verifiable, since any serious investor will conduct extensive due diligence. In describing the competitive landscape, show how your business model creates competitive advantages, and – more importantly – defensible barriers to entry.

Venture Capital 129

Venture Capital Business Plan Technical Review Private Placement 129

Up and Running

MARCH 14, 2018

Your revenue or business model. Show what you’re projecting in revenue (per product) over the next three to five years. Show you’ve done some due diligence on this exit strategy, including the companies you’re targeting, and why it would make sense three, five, or 10 years down the road.

Hockey Stick 164

Hockey Stick Exit Strategy Technical Review Angel Investor 164

David Teten

JANUARY 19, 2021

More and more startups are pursuing Revenue-Based VCs , but “RBI” doesn’t fit everyone. Flexible VC 101: Equity Meets Revenue Share. By tying payments to actual revenues, founders and investors remain aligned around the company’s real-time performance, good or bad. Flexible VC: Revenue -based. Of the Inc.

Cofounder 78

Cofounder Technical Review Equity Dividend 78

Startup Professionals Musings

NOVEMBER 4, 2011

are eliminated during due diligence. Like the business plan, a financial model is required as much for your own use as to impress angel investors. In most cases, a Microsoft Excel spreadsheet is adequate, with projection formulas for revenue, costs, and cash flow over the next five years. Free trials don’t count.

Intellectual Property 249

Intellectual Property Angel Investor Technical Review Elevator Pitch 249

venturedig.com

NOVEMBER 1, 2009

The business models within the social media realm are much different than traditional businesses. In social networking, they’re ever-changing, backed by eye-opening revenue and have very little documentation. For this reason, this piece will be routinely updated with new models and new feedback from your comments.

Social Network 55

Social Network Business Model Networking CPA 55

ReadWriteStart

JUNE 1, 2020

Funding might be a need in some cases — but it’s not an absolute necessity. ? The business should be self-sustainable. The primary source of your funds should be your paying customers, i.e., your business should generate enough revenues and profits to fund the growth and expansion. Incubators and Accelerators.

Startup 150

Startup Entrepreneur Elevator Pitch Seed Stage 150

Startup Professionals Musings

SEPTEMBER 23, 2010

are eliminated during due diligence. Like the business plan, a financial model is required as much for your own use as to impress angel investors. In most cases, a Microsoft Excel spreadsheet is adequate, with projection formulas for revenue, costs, and cash flow over the next five years. Free trials don’t count.

Angel Investor 224

Angel Investor Intellectual Property Technical Review Elevator Pitch 224

YoungUpstarts

SEPTEMBER 10, 2018

Pitch it to someone with a startup or business related background, but who doesn’t have experience in your industry. Our business model back then was very complex, and it included a B2C as well as a B2B business model, that wasn’t being implemented yet. Don’t describe a 100% theoretical business model.

Programming 124

Programming Chile B2B B2C 124

Feld Thoughts

AUGUST 25, 2015

As dollars flowed into the industry, cooperation was replaced by competition, to the detriment of deal flow, due diligence, ability to add value and, of course, returns. We should invest where our background and instincts and due diligence convince us the anticipated return will far exceed our evaluation of the risk.

Venture Capital 70

Venture Capital SBIC Technical Review Silicon Valley 70

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. Undefined business model or very low gross margins. Surprises during due diligence.

Due Diligence 120

Due Diligence Intellectual Property Preferred Stock Seed Stage 120

Startup Professionals Musings

MAY 19, 2023

Solution and business model innovation require pushing the limits. A business model is not an after-thought. Passion and ego are no substitute for a business model that makes sense. Recurring revenue is the foundation for growth. Self-demanding beats boss-demanding every time.

Technical Review 229

Technical Review Due Diligence Business Model Demand 229

Startup Professionals Musings

AUGUST 23, 2020

Solution and business model innovation require pushing the limits. A business model is not an after-thought. Passion and ego are no substitute for a business model that makes sense. Recurring revenue is the foundation for growth. Self-demanding beats boss-demanding every time.

Technical Review 324

Technical Review Entrepreneur Due Diligence Business Model 324

Up and Running

JULY 6, 2021

eCommerce has become a major business , so it’s no surprise you’re considering joining the 7.9 million online businesses that sell products via the web. Research published by Statista in March 2021 showed revenue from eCommerce in the United States reached $431.6 billion in 2020 and is expected to reach $563.4 billion by 2025.

eCommerce 163

eCommerce Startup Business Model Demand 163

Austin Startup

NOVEMBER 12, 2017

Let’s talk first about an angel round to individual investors, all of whom may be duly accredited but many of whom may have no background that enables them to understand fully your idea and your business model. Is third-year revenue of $10M good or bad? A price of $2 per share means nothing in itself.

Term Sheet 48

Term Sheet Technical Review Due Diligence Merger 48

Lightspeed Venture Partners

OCTOBER 7, 2012

The two founders invested $40k in the business, and plan to license it rather than manufacture it because manufacturing seems too hard. They won a design award at a trade show, but have no revenue and no orders. Doing the research to form your own view of a company’s prospects is called due diligence.

Technical Review 110

Technical Review Technical Cofounder Valuation Pre-Money Valuation 110

David Teten

DECEMBER 3, 2019

However, in private markets, there is more room to optimize across all 11 steps of the investing process: firm management , marketing, fundraising , origination , manage relationships, due diligence, negotiation, monitoring, portfolio acceleration , reporting, and. 6) Due diligence. I personally use Salesforce.

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

Startup Professionals Musings

OCTOBER 6, 2018

Solution and business model innovation require pushing the limits. A business model is not an after-thought. Passion and ego are no substitute for a business model that makes sense. Recurring revenue is the foundation for growth. Self-demanding beats boss-demanding every time.

Technical Review 233

Technical Review Due Diligence Business Model Demand 233

Tim Keane

OCTOBER 19, 2006

Due diligence: An Entrepreneurs Perspective » October 19, 2006. Of course, everyone understands that somewhere in the equation theres revenue, whether directly or indirectly. Of course, everyone understands that somewhere in the equation theres revenue, whether directly or indirectly. Thinking about pricing.

Software Review 60

Software Review Wisconsin Technical Review Angel Investor 60

Austin Startup

AUGUST 20, 2017

Make your choices only after you’ve done some due diligence with other companies where they’ve served. Your business works as intended if you can attract customers that fit into the context of your operation. Do they perceive enough value to pay prices that create for you a profit margin that matches your business model?

Technical Review 48

Technical Review Software Review Cap Table Securities and Exchange Commission 48

YoungUpstarts

NOVEMBER 4, 2020

Doing so also closed their doors to a source of revenue they relied heavily on to keep their business alive and operating. Through this economic turmoil some businesses have collapsed and others have flourished. There were certain companies who appreciated the experience and Expo’s due diligence.

Technical Review 279

Technical Review United States eCommerce Due Diligence 279

Duct Tape Marketing

FEBRUARY 3, 2022

You're selling your culture, you're selling your client list, you're selling your business model, but that's it, you have no tangible also, you know, agencies, don't typically service clients in a localized market. Are they all SMBs small businesses or do you have enterprise really big clients? It's part of a law firm.

Entrepreneur 80

Entrepreneur Technical Review Cofounder Valuation 80

YoungUpstarts

DECEMBER 2, 2019

In fact, remote work is on the rise – especially in the form of virtual assistants – and it’s one of the primary reasons why more small businesses are opting to outsource work. Inefficiencies can often cost businesses between 20-30% of their annual revenue. They help filter communication.

Technical Review 147

Technical Review Due Diligence Technical Support Bootstrapping 147

Early Growth Financial Services

OCTOBER 29, 2013

They covered a lot of territory—including what is essential in analyzing your business model and its economics, the funding options to consider including revenue based financing, pulling together a fundraising game plan, and what’s required with regard to documentation and due diligence.

Due Diligence 41

Due Diligence Equity Business Model Finance 41

Startup Professionals Musings

SEPTEMBER 24, 2016

Solution and business model innovation require pushing the limits. A business model is not an after-thought. Passion and ego are no substitute for a business model that makes sense. Recurring revenue is the foundation for growth. Self-demanding beats boss-demanding every time.

Technical Review 120

Technical Review Due Diligence Startup Business Model 120

infochachkie.com

SEPTEMBER 24, 2011

There is an inherent conflict in a consultant’s business model and the needs of a startup. For instance, if a consultant proposes to help you with public relations, pay them a commission equivalent to the greater of a flat fee per story placed or a percentage of revenue generated from the PR coverage.

Equity 40

Equity Silicon Valley Cofounder Technical Review 40

Tim Keane

JANUARY 12, 2010

3]   However, if they are built bottom up, they demonstrate and make explicit a range of business model assumptions the entrepreneur is using to think about his business and its revenue model.   Pre-bubble Siliicon Valley deals were popularly valued at multiples of revenue.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Startup Professionals Musings

SEPTEMBER 23, 2015

Solution and business model innovation require pushing the limits. A business model is not an after-thought. Passion and ego are no substitute for a business model that makes sense. Recurring revenue is the foundation for growth. Self-demanding beats boss-demanding every time.

Technical Review 120

Technical Review Due Diligence Business Model Demand 120

Business Plan Blog

SEPTEMBER 5, 2013

But, they are also looking at your ability to turn a business concept into a realistic business model. Additionally, if you don’t have the revenue to pay for key hires that are necessary for the business’ current success then you likely are not attractive to investors.

Entrepreneur 53

Entrepreneur Due Diligence Valuation Business Plan 53

reidhoffman.org

NOVEMBER 12, 2013

we had no revenue. But with so many investors still licking their wounds from the dot-com bust, many focused on proven business models, such as advertising or e-commerce. As a result, we knew that our pitch would need to steer into investors’ biggest concern: the lack of revenue. Investors see a lot of pitches.

Entrepreneur 111

Entrepreneur Revenue Viral Networking 111

Up and Running

MAY 28, 2015

There’s a lot of questions about what do you actually need in terms of information, if you’re going to do your forecasting, and how does one put together a revenue forecast if you’ve never started a business or your business is brand new. It is a very difficult proposition. There seems to be a lot of questions.

Lean 60

Lean Business Plan Video Software Review 60

View from Seed

MARCH 15, 2017

Internally, the scarcity of tangible business metrics – product usage or revenue multiples for example – can make an investment decision feel daunting. So, the decision-making process at seed then seems neurotic – a tug-of-war without the rope to champion convictions while pressure testing business mechanics.

Due Diligence 265

Due Diligence Seed Stage Portfolio Metrics 265

Steve Blank

NOVEMBER 5, 2009

Chasing funding versus chasing customers and a repeatable and scalable business model, is one reason startups fail. Is there a profitable business model? The Traditional VC Pitch Entrepreneurs who pursue the traditional product development model don’t have customer data to answer these questions. Can it scale?”

Customer Development 264

Customer Development Developer Customer Silicon Valley 264

Tim Keane

AUGUST 21, 2006

Can you think of the whole process of due diligence not primarily as a verification of high growth process but perhaps as a joint learning activity? As the venture progresses from financing to revenue (whether financed by an investor or the entrepreneur) that first big, critical issue has to be the first miss on projections.

Milwaukee 60

Milwaukee Due Diligence Wisconsin Angel Investor 60

Austin Startup

FEBRUARY 25, 2020

They won’t demand a five-year pro-forma revenue projection for a 10k pre-seed check. In all of these cases, if one simply performs even an ounce of due diligence, over 90% of bad actors can be filtered out. The investors are typically more experienced with venture investing, which is great for founders.

Technical Review 65

Technical Review San Francisco Artificial Inteligence Cofounder 65

Steve Blank

JULY 2, 2009

Ps: my limited perspective comes with self recognition of a lack of hands on experience always enjoy it when I stop in to read here Steve Reply Aamir , on July 2, 2009 at 10:18 am Said: Awesome post Steve… but isn’t drawing the business model for a gaming company going to be easy? Make game, market, sell, profit?

Silicon Valley 120

Silicon Valley Technical Review RSS Software Review 120