Lightspeed Venture Partners
SEPTEMBER 23, 2012
The entrepreneurs had made $150k in revenue running classes for four months at a gym in New York, selling out the classes at $35/class. They plan to franchise the model (presumably including selling equipment plus a certification program). post money valuation. implying a $600k post money valuation.
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. So the entrepreneur was willing to accept a valuation more than $10M lower than a previous valuation.
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betashop.com
OCTOBER 8, 2012
But, you can iterate and iterate on features, but you cannot iterate your way to a business model. I’ve seen too many businesses get stuck or fail because of their endless pursuit for the magic new feature that is going to help them gain traction. Understand whether your business is a VC business or not.
Lightspeed Venture Partners
NOVEMBER 12, 2012
And his business is taking on a very crowded market that has been around for a long time. When asked why the company is worth a $1M post money valuation, he said, “What it comes down to is passion.” He did not talk about any product features that actually focused on his baby boomer target market.
Lightspeed Venture Partners
OCTOBER 1, 2012
On the other hand, a 7% royalty means that Kevin and Barbara got to keep 93% of future revenues. But if the company is sold for less than their post money valuation, they would prefer to get their money back. He might have been better off letting them work for him, instead of him working for Mark and Daymond.
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