David Teten

JANUARY 19, 2021

(co-written with Jamie Finney, Founding Partner at Greater Colorado Venture Fund. More and more startups are pursuing Revenue-Based VCs , but “RBI” doesn’t fit everyone. From RBI, Flexible VCs borrow the ability to reap meaningful returns without demanding founders build for an exit. Of the Inc. 5000 companies, only 6.5%

Cofounder 78

Cofounder Technical Review Equity Dividend 78

Austin Startup

FEBRUARY 4, 2019

L to R: Tiara Zolniez (Co-Founder & Sales), Dr. Roshawnna Novellus (Co-Founder & CEO), Alisha Griffey (COO) The Forrest Four-Cast: February 4, 2019 Fifty diverse startups will aim to impress a panel of judges and a live audience with their skills, creativity and innovation at SXSW Pitch Presented by Cyndx.

Startup 50

Startup Cofounder Technical Review Equity 50

David Teten

AUGUST 19, 2019

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. For background, see Revenue-Based Investing: A New Option for Founders who Care About Control. Bigfoot Capital.

Revenue 60

Revenue Technical Review Software Review Equity 60

Startup Professionals Musings

OCTOBER 9, 2021

A popular myth these days is that finishing college only dilutes your entrepreneurial instincts, and the best of the best, including Bill Gates, Steve Jobs and Mark Zuckerberg, dropped out early to hasten their success. Get involved in startup-business incubator activities with peers at school. I agree with Robert E.

Entrepreneur 373

Entrepreneur Chad Incubator Dilution 373

Startup Company Lawyer

MARCH 14, 2010

After the recent announcement of the Series Seed Financing documents by Marc Andreesen, Brad Feld points out that there are now four sets of “open source&# equity seed financing documents: TechStars Model Seed Funding Documents (by Cooley). Y Combinator Series AA Equity Financing Documents (by WSGR). under $500K).

Finance 70

Finance Software Review Term Sheet Liquidation Preference 70

Altgate

DECEMBER 15, 2010

@altgate Startups, Venture Capital & Everything In Between Skip to content Home Furqan Nazeeri (fn@altgate.com) ← No one wants to tell you your baby is ugly More on Liquidation Preferences → Pre-Money Valuation vs Number of Founders Posted on December 15, 2010 by admin Here’s a chart of the day worth sharing.

Pre-Money Valuation 66

Pre-Money Valuation Valuation Cofounder Founder 66

ReadWriteStart

APRIL 4, 2023

From paying attention to fees to balancing what works for you, here are 13 answers to the question, “Is crowdfunding for startups a good idea? While these fees may seem reasonable at first glance, they can add up quickly and significantly impact the amount of capital that the startup receives from the crowdfunding campaign.

Startup 141

Startup Campaign Cofounder Venture Capital 141

Startup Professionals Musings

OCTOBER 28, 2018

A popular myth these days is that finishing college only dilutes your entrepreneurial instincts, and the best of the best, including Bill Gates, Steve Jobs and Mark Zuckerberg, dropped out early to hasten their success. Get involved in startup-business incubator activities with peers at school. I agree with Robert E.

Chad 242

Chad Incubator Startup Dilution 242

Both Sides of the Table

DECEMBER 1, 2009

This is part of my ongoing series on Startup Advice. I was reading one of my favorite websites for entrepreneurs, VentureHacks, this weekend and noticed that they are running a long piece on how to pick a co-founder. I advocate treating them like a co-founder in every way except when they join and how much equity they get.

Hiring 289

Hiring Cofounder Dilution Startup 289

www.avc.com

SEPTEMBER 22, 2011

To be clear, these are hires we are talking about, not co-founders. Co-founders are an entirely different discussion and I am not talking about them in this post. This "best value" can be the valuation on the last round of financing. The other important data point is the number of fully diluted shares.

Equity 64

Equity Employee CTO Hire Fractional CTO 64

Both Sides of the Table

JUNE 5, 2015

Over the years I’ve written extensively about the downsides of convertible notes for startups such as here , here and here. So how DOES a VC think about financings at early stages? If you’re a solo founder and haven’t built out your team or engineers I’m likely to want 15+%. It’s very simple.

Pre-Money Valuation 150

Pre-Money Valuation Option Pool Post-Money Valuation Dilution 150

Feld Thoughts

JULY 29, 2011

Finance Friday’s gets off the ground with today’s post by introducing you to an imaginary startup, the entrepreneurs that we’ll being following throughout the series, and their first challenges: splitting up the founders’ equity and addressing the case where one of the founders provides the initial seed capital for the business.

Equity 137

Equity Finance Pre-Money Valuation Denver 137

Hunter Walker

AUGUST 8, 2023

Obvious caveats to my POV here, most specifically: exposure is limited to largely the US/SiliconValley ecosystem, driven by our own portfolio, my friends and co-investors, the funds I’m a LP in, and our institutional LP relationships. Valuations. Whatever gets reported is just the tip of the iceberg. Soft Acquisition Market.

Portfolio 98

Portfolio Cap Table LP Valuation 98

Hunter Walker

JANUARY 15, 2016

By the end of 2004 I had brought on two co-founders: John Vars – who is now the Chief Product Office at TaskRabbit, and Steven Reading took over Sales and Revenue. How do founders think about whether it’s time to move on or not? Ben Horowitz talks about asking founders what secret they know that no one else does.

Technical Review 48

Technical Review Startup Cofounder SMS 48

Startup Professionals Musings

NOVEMBER 15, 2014

A popular myth these days is that finishing college only dilutes your entrepreneurial instincts, and the best of the best, including Bill Gates, Steve Jobs and Mark Zuckerberg, dropped out early to hasten their success. Get involved in startup-business incubator activities with peers at school. business entrepreneur Harvard startup'

Chad 279

Chad Incubator Dilution LLC 279

David Teten

NOVEMBER 17, 2011

This is the third of three blog posts on financial modeling for startups. The first was on best practices in building financial models , and the second was a template financial model for a startup. Download the Startup Options Valuation model here. Valuing startups is a far fuzzier process.

Employee 155

Employee IRR Startup Mexico 155

Austin Startup

MARCH 7, 2021

Austin, Dallas, Houston, San Antonio form a massive startup Megalopolis that is attracting top talent, impact-focused investors, and the most innovative companies in the world. Startups and investors should treat Texas like one big city. These are all potential customers and strategic partners for startups.

Texas 90

Texas San Antonio Houston Dallas 90

www.inc.com

SEPTEMBER 24, 2011

Finance | Tuesdays. Advisor. ); STARTUP. Financing a Small Business. Financing A Small Business. Personal Finance. Before Roving Software could receive its first round of financing from professional investors, in early 1999, he had to put all the stock arrangements in writing. Innovation | Fridays.

Fractional CTO 40

Fractional CTO Equity Iowa Technical Cofounder 40

thestartuplawyer.com

FEBRUARY 24, 2010

Contact The Startup Lawyer: Home Page About Contact FAQs Glossary Ryan Roberts Law: Home Page Social Networks: Facebook Twitter LinkedIn Flickr Delicious Digg Last.FM He obviously never launched a startup and got shafted by a co-founder. He obviously never launched a startup and got shafted by a co-founder.

Cofounder 40

Cofounder Founder Preferred Stock Startup 40

The Startup Lawyer

AUGUST 22, 2011

Here’s a list of the top 5 deal terms that cause harm to startups at the seed financing stage and therefore should be avoided: 5. Whatever the form of control, seed investment is way too early to be even thinking about losing any amount of control of your startup. Non-Dilution. Dividend (that pays out).

Angel Investor 99

Angel Investor Dividend Dilution Cofounder 99

Scott Edward Walker

APRIL 9, 2012

Introduction We are in the golden age of seed financing. Venture capital funds, seed funds, super angels, angel groups, incubators, and “friends and family” are all playing the seed financing game and investing early in startups in an attempt to land the next Facebook. This post was originally published on TechCrunch.]

Preferred Stock 87

Preferred Stock Finance Common Stock Liquidation Preference 87

Scott Edward Walker

APRIL 8, 2013

I’m using Twitter as a form of micro-blogging to share interesting blog posts, articles and podcasts relating to entrepreneurship and startups, M&A and legal issues. “Be careful not to have too many co-founders; it’s the most expensive dilution you’ll ever face.” Cheers, Scott. Top 5 Tweets.

Dilution 49

Dilution Cofounder RSS Finance 49

Both Sides of the Table

APRIL 14, 2012

What I want to talk about today is one of the insider baseball discussions of our industry this past week: The odd fact of the $500 million financing round completed just before the company sold for a B. But a healthy percentage of successful startups have potential buyers “showing interest.” Was this a good thing?

Valuation 316

Valuation Balance Sheet Dilution Term Sheet 316

David Teten

JANUARY 21, 2021

(co-written with Jamie Finney, Founding Partner at Greater Colorado Venture Fund. This essay is part of a series on alternative VC: I: Revenue-Based Investing: a new option for founders who care about control. III: Why are Revenue-Based VCs investing in so many women and underrepresented founders?

Equity 78

Equity Revenue Cofounder Colorado 78

View from Seed

JANUARY 28, 2016

When we talk about seeds, we mean your first outside round of financing at the earliest stages of your business. In my prior post, I talked about the rise of the pre-seed and a more nuanced definition of a pre-seed based on milestones, not financing labels. This staged approach is often much better for the founders as well.

Cofounder 120

Cofounder Finance Founder Syndicate 120

Startup Professionals Musings

OCTOBER 15, 2016

A popular myth these days is that finishing college only dilutes your entrepreneurial instincts, and the best of the best, including Bill Gates, Steve Jobs and Mark Zuckerberg, dropped out early to hasten their success. Get involved in startup-business incubator activities with peers at school. I agree with Robert E.

Entrepreneur 120

Entrepreneur Chad Incubator Dilution 120

View from Seed

JANUARY 26, 2016

It’s become increasingly common for startups to raise several seed rounds, and this has led to a bifurcation in the seed stage between what are known as “pre-seed” (or “genesis”) and institutional seed rounds. The entire funding progression of startups pushed out to the right.

Seed Stage 120

Seed Stage Early Stage Cofounder Finance 120

David Teten

AUGUST 21, 2019

Most founders who are raising capital look first to traditional equity VCs. Revenue-Based Investing (“RBI”) is a new form of VC financing, distinct from the preferred equity structure most VCs use. For more background, see Revenue-Based Investing: A New Option for Founders who Care About Control. Less or no dilution.

Revenue 60

Revenue Liquidation Preference Equity Cofounder 60

A Smart Bear: Startups and Marketing for Geeks

JULY 11, 2011

SEOmoz founder and figurehead Rand Fishkin wrote a typically transparent, thoughtful blog post about his struggle of whether to raise a Series B. The typical arguments against: (a) unfair to employees/co-founders, (b) now you’re not hungry so you care less, work less, (c) swinging for fences without attention to detail is imprudent.

.Net 230

.Net Cofounder Dilution Finance 230

K9 Ventures

MAY 6, 2015

Conventional wisdom in the startup world dictates that two founders are ideal for a startup. There are lots of famous pairs of duo co-founders: Larry Page and Sergey Brin, Jerry Yang and David Filo, Hewlett and Packard, Bill Gates and Paul Allen. They prefer teams of two or three over a solo founder.

Cofounder 48

Cofounder Founder Silicon Valley Technical Cofounder 48

This is going to be BIG.

DECEMBER 28, 2013

Every time he opens his mouth about founder diversity, he seems completely out of his league to address the topic. The biggest question I think VC''s face right now is whether or not, in the future, the best founders will look and act like the best founders of the past. That''s less than 10%. That''s 25%.

Venture Capital 152

Venture Capital Cofounder IRR Dilution 152

The Startup Lawyer

FEBRUARY 4, 2011

Great news — your startup just got accepted to an incubator! But before your startup signs up and cashes that $[XX,000] check, your startup’s co-founders should sit down and evaluate the incubator’s offer. Pre-money valuations startups receive from incubators are typically low…really low.

Incubator 105

Incubator Pre-Money Valuation Option Pool Advisory Board 105

Startup Company Lawyer

MAY 4, 2009

Adeo Ressi , the founding member of TheFunded , recently announced the establishment of TheFunded Founder Institute. The Founder Institute helps founders launch innovative companies by providing training, services, and company-building assignments, such as incorporating the business, filing provision patents, and setting up books and records.

Founder 28

Founder Warrant San Francisco Intellectual Property 28

David Teten

DECEMBER 2, 2019

You’ve decided to launch a technology-enabled startup with a positive social impact! Now the bad news: some venture capitallists have a bias against startups with an explicit positive social impact, on the grounds that they have a smaller addressable market, and that the founders are not sufficiently focused on creating shareholder wealth.

Technical Review 60

Technical Review SBIR Dilution Silicon Valley 60

Business Plan Blog

OCTOBER 4, 2013

Aligning the Startup Team Strategy with the Capitalization Strategy. The single most important factor to raising capital for any tech startup is the management team. Furthermore, a startup works differently than a large corporation. Don’t make everyone a founder. Be sure to leave plenty of equity for investors.

Part-Time VPE 79

Part-Time VPE Fractional VPE Cofounder CTO Hire 79

The Next Web

SEPTEMBER 29, 2013

Before StartEngine, Howard co-founded Activision and founded Acclaim Games. . In startup-land, people seem to think raising money is a signal that their business is sound and they should start scaling as soon as possible. The main challenge, as we’ll discuss below, is that startups need to internalize two conflicting attitudes.

Metrics 136

Metrics Cofounder Cram Down Liquidity Event 136

The Startup Lawyer

MARCH 1, 2010

“The Series Seed Documents are a standardized set of documents that can be quickly and easily deployed for a seed investment: to help get a company financed properly, legally, quickly, and intelligently.&#. The drafters are “open sourcing&# the documents so that they may be continually improved by the startup community.

Preferred Stock 79

Preferred Stock Term Sheet Redemption Registration Rights 79