6 Keys To Managing Funding From People Close To You

Startup Professionals Musings

Cohen and John Kador, in their classic book “ What Every Angel Investor Wants You to Know ,” includes these great points of practical advice on this subject: Manage expectations before the fact.

The Damaging Psychology of Down Rounds

Both Sides of the Table

a) doing what is effectively a down round preemptively when I don’t have to, by underpricing my current round in this market vs. b) accepting the market price along with some risk of taking a down round in the future, if I don’t hit my milestones, why would I ever choose b)?” I would love it if other people would weigh in on the comments section below if you’ve had experiences with down rounds. The Damaging Psychology of Down Rounds.

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The Good The Bad And The Ugly Of Funding From Friends

Startup Professionals Musings

Cohen and John Kador, in their classic book “ What Every Angel Investor Wants You to Know ,” includes these great points of practical advice on this subject: Manage expectations before the fact. That means writing down and signing the terms of the agreement, after making sure everyone understands them. For entrepreneurs, friends and family money usually represents the smallest increment of funding, yet requires the most time to manage.

Why Seed Funds Have Scaled

Haystack

Much has been written about the fact that traditional seed stage funds have grown in size and dollars under management. If the 2010’s were about the institutionalization of seed funds, I believe the next decade ahead will be a test of who can stake out their territory as these forces rise from the bottom and cram down from the top.

How To Take Money From Friends And Still Be Friends

Startup Professionals Musings

Cohen and John Kador, in their classic book “ What Every Angel Investor Wants You to Know ,” includes these best points of practical advice I’ve seen recently on this subject: Manage expectations before the fact. That means writing down and signing the terms of the agreement, after making sure everyone understands them. For entrepreneurs, friends and family money usually represents the smallest increment of funding, yet requires the most time to manage.

Founders Finding Funding From Friends May Be Fools

Startup Professionals Musings

Cohen and John Kador, in their recent book “ What Every Angel Investor Wants You to Know ,” includes these best points of practical advice I’ve seen recently on this subject: Manage expectations before the fact. That means writing down and signing the terms of the agreement, after making sure everyone understands them. For entrepreneurs, friends and family money usually represents the smallest increment of funding, yet requires the most time to manage.

5 Ways to Make Your Startup a Choice Investment

Startup Professionals Musings

I like the work just published by Bob Rice in “ The Alternative Answer ,” which does a great job of summarizing the investment universe, starting with the “conventional” stocks, bonds, and real estate, but moving on through more esoteric alternatives, including hedge funds, private equity, real assets, managed futures, and finally venture funding. Here are the top five, as outlined by Rice in his book, which match my own experience: Management team.

Want to Know How First Round Capital was Started?

Both Sides of the Table

They chose the name First Round Capital because they thought capital would be deployed most efficiently at smaller seed stage rounds considering the cost to build an internet business had come down drastically. He also says it is important to be able to participate in follow on rounds so as not to get “crammed down”. They did not take salaries during the first two years and invested more money in the firm than they received from management fees.

Startup Fairy Tales and Other Tall Tales That Venture Capitalists Tell

Growthink Blog

Management has the wrong pedigree, is geographically undesirable, competes in the wrong industry, and/or has a business model that lacks "scalability credibility" with the venture community. Venture capital funds are usually 7 - 10 year partnerships whereby the general partners - the “VC” - manage the capital of the limited partners, usually institutions (endowments, pension funds, etc.).

Lean Startups aren't Cheap Startups

Steve Blank

In times when venture capital is hard to get, investors extract high costs for failure (down-rounds, cram downs , new management teams, shut down the company.) Lean Startups aren’t Cheap Startups « Steve Blank (tags: startup product-management strategy) [.]

Lean 233

Are Investors Being Unreasonable? - Startups and angels: Along the.

Tim Keane

"  The problem has been that too-high valuations and too generous terms have spawned painful down rounds that squash the entrepreneur and his early investors.    New money, usually VC money, comes in and crams down those early investors and takes substantial shares from the entrepreneur.    New money, usually VC money, comes in and crams down those early investors and takes substantial shares from the entrepreneur. 

Does raising money mean you should start scaling?

The Next Web

Howard Marks is a serial entrepreneur and Managing Director of LA tech accelerator StartEngine. Sometimes you’ll see that the lifetime value of your customers has gone way down because now you’re doing volume you’ve harvested all your ‘ideal’ early adopters. Once the money is spent, young entrepreneurs are usually faced with this situation: The Cram Round - Founders raise money at a lower valuation than the first round and now understand what anti dilution clauses really mean.