The Startup Magazine
FEBRUARY 21, 2024
We engage intimately with businesses and their assets, understanding their operations, aspirations, and the hurdles they face. Are there new revenue streams you can tap into? Simultaneously, we conducted a thorough operational review to identify inefficiencies and areas for cost reduction. ARIF BHALWANI: Sure.
David Teten
AUGUST 19, 2019
So you’re interested in raising capital from a Revenue-Based Investor VC. A new wave of Revenue-Based Investors (“RBI”) are emerging. For background, see Revenue-Based Investing: A New Option for Founders who Care About Control. Rational burn profile, up to 50% of revenue at close, scaling down. Bigfoot Capital.
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Both Sides of the Table
SEPTEMBER 28, 2014
So if your costs are $500,000 per month and you have $350,000 per month in revenue then your net burn (500-350) is equal to $150,000. But those of us with longer memories remember that the revenue line can move south very quickly when the market overall turns south. Gross burn is the total amount of money you are spending per month.
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. Of the Inc. 5000 companies, only 6.5% raised from angels.
Berkonomics
DECEMBER 12, 2019
If a business were operating above breakeven and revenues and expenses steady, profits would flow to either the shareholders’ pockets or to working capital and taxes. As loan covenants become closer to being violated or after such an event, bankers have some latitude in deciding how to handle their accounts.
Up and Running
NOVEMBER 25, 2020
According to Franchising.com , there are more than 3,000 franchisors operating in the United States currently, and, “an average of 300 new brands start franchising each year.” Most franchisors calculate their royalties and marketing fees as a percentage of gross revenue and require franchisees to pay on a monthly basis.
Tim Keane
MARCH 9, 2011
If, on the other hand, there is some near term prospect of cash flow (say within six months or a year) but no ability to repay in the meantime, then the entrepreneur may try and find a way to finance his “pre-revenue period” using friends and family money that accepts a somewhat lower payment in recognition of a relationship beyond just investing.
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