Haystack

JANUARY 12, 2020

For those following this blog and the seed market over the past decade, you may have noticed that every year, we see increases across the board — more investors, newer funds, and funds that get larger. Rather, this short blog is filled only with my own observations from being in the middle of the evolving seed market since 2013.

Seed Stage 106

Seed Stage Cram Down Early Stage Cofounder 106

Startup Professionals Musings

APRIL 17, 2013

In the interim, there is no market for the shares, and no dividends or interest. That means writing down and signing the terms of the agreement, after making sure everyone understands them. Insist on paying market rates for commercial loans, since the IRS can instigate some nasty consequences on “gifts.”

Cram Down 230

Cram Down Angel Investor Equity Dividend 230

Startup Professionals Musings

NOVEMBER 11, 2015

In the interim, there is no market for the shares, and no dividends or interest. That means writing down and signing the terms of the agreement, after making sure everyone understands them. Insist on paying market rates for commercial loans, since the IRS can instigate some nasty consequences on “gifts.”

Cram Down 120

Cram Down Angel Investor Equity Dividend 120

Rob Go

SEPTEMBER 2, 2014

This forces some level of intellectual honestly about one’s position in the market, and can push you to try to see around corners and respond. In a frothy market, rounds can get done in this way at pretty high prices (or valuation caps for notes) albeit with less value-added investors involved. Getting Crammed Down.

Cram Down 66

Cram Down Institutional Investors Dilution Seed Stage 66

Startup Professionals Musings

JUNE 2, 2013

Angels expect at least a working prototype and a hint of market acceptance (traction) before investing. The target market better be a big one, like over a billion dollars, with a double-digit growth rate, large enough to absorb multiple entrants. Before that, rely on friends, family, and fools. Scalability.

Cram Down 269

Cram Down Angel Investor Intellectual Property Venture Capital 269

Growthink Blog

MAY 23, 2011

Technical progress and market traction are much slower and cost a lot more than anticipated. A " black swan " investor appears out of the blue and backs the company - less impressed by the technology than by the talent, desire, and grit of the entrepreneur. There are a lot of dark, hard days.

Angel Investor 112

Angel Investor Venture Capital Sweat Equity Cram Down 112

The Next Web

SEPTEMBER 29, 2013

The two most important considerations are team dynamics and where you fit in the market. You’re basically tinkering with everything at this stage – product, marketing, sales, partnerships, etc. You’re tinkering with your marketing and sales channels. How it applies to your marketing channels. Tough situation.

Metrics 136

Metrics Cofounder Cram Down Liquidity Event 136

Rob Go

MAY 21, 2014

Care just went public, is an $80M+ revenue business, and has a multi-hundred million dollar market cap (not a vapor private valuation). The three businesses above don’t market themselves in flashy or audacious ways. The more and better the caregivers in the network, but more valuable it is for consumers.

Boston 57

Boston Cram Down Indiana eCommerce 57

Steve Blank

NOVEMBER 2, 2009

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.) Marketing demand creation programs (Search Engine Marketing, Public Relations, Advertising, Lead Generation, Trade Shows, etc.)

Lean 244

Lean Silicon Valley Startup RSS 244

A Crowded Space

MAY 31, 2016

The great companies that are breaking out will be fine in any market. In addition, in the more dire cases, these investors may see their holdings crammed down by a reverse split where the preferred converts to common on a x:1 basis, so x shares of preferred go to 1 share of common. A 5% equity stake could get cut down to 1%.

Cram Down 60

Cram Down Pay to Play Angel Investor Warrant 60