What Entrepreneurs Should do about Price Fixing

Both Sides of the Table

I thought I’d try to look at it from a different lens, that of the entrepreneur. As an entrepreneur you should assume that. That is why I tell people not to shop deals too widely. So acknowledge it to yourself and be prepared to deal with it. This is super funny.

Which books would you recommend to a VC analyst-associate?

Gust

Insights from Leading Practitioners on the Art of Raising a Fund, Deal Structuring, Value Creation, and Exit Strategies. Raising Venture Capital for the Serious Entrepreneur. Venture Deals. The Business of Venture Capital. Mastering the VC Game. A Venture Capital Insider Reveals How to Get from Start-up to IPO on Your Terms. Term Sheets & Valuations. A Line by Line Look at the Intricacies of Term Sheets & Valuations.

Keep Term Sheets Simple for Quicker Cash to Spend

Startup Professionals Musings

Remember a term sheet agreement is not a deal until the check clears. Entrepreneurs sometimes assume an initial agreement with an Angel is a commitment, so they start spending before any money is received. It prevents the entrepreneur from selling early, at a loss to the investor.

Keep Term Sheets Simple for Quicker Cash to Spend

Gust

Remember a term sheet agreement is not a deal until the check clears. Entrepreneurs sometimes assume an initial agreement with an angel is a commitment, so they start spending before any money is received. It prevents the entrepreneur from selling early, at a loss to the investor.

A Primer on Angel Investment ‘Simple Term Sheets’

Startup Professionals Musings

Remember a term sheet agreement is not a deal until the check clears. Entrepreneurs sometimes assume an initial agreement with an angel is a commitment, so they start spending before any money is received. It prevents the entrepreneur from selling early, at a loss to the investor.

Both sides must be fair in a term sheet negotiation.

Berkonomics

These usually involve a handful of angel investors, and a few entrepreneurs, who all want to build the very best term sheet for their exciting nascent enterprise. As an example, twenty five years ago, most VCs used common share deal structures. By Basil Peters.

When Should Startup Founders Discuss Valuation with Seed VCs?

View from Seed

In short, more and more entrepreneurs are signaling their price expectations earlier in their seed fundraise process. In theory, there are three levels of pricing for an entrepreneur to potentially signal to a prospective investor: 1.

The Corrosive Downside of Acquihires

Both Sides of the Table

And a few teams of super talented, educated and bright entrepreneurs make a few mill. Many buying companies price these deals on the basis of $1 million per engineer on the team for an early-stage deal. And wants to structure a huge payout for the employees that will remain.

Who Invests In Investors: Homebrew LP Shares VC Performance Goals, Importance of Diversity & What They Look For In New Funds

Hunter Walker

We triangulate with investors, entrepreneurs and large company operators to assess probability of success and ability to attract in-demand entrepreneurs. Given the abundance of capital in today’s market, we want to feel that an entrepreneur will pick this team to sit with at the table.

LP 130

That convert you raised last year is a part of your cap table

VC Adventure

When it comes to convertible debt, I’ve had a few instances recently where “out of sight, out of mind” has created some misunderstandings around deal structures. Of course many entrepreneurs naturally focus on the main tab of their cap table spreadsheet that shows ownership by founder, investor, etc and for them this is the starting point of negotiating a round.

Knowing When It’s Time To Sell Your Startup

YoungUpstarts

However, for many successful entrepreneurs, weighing all of the personal and financial issues that go into this decision can be gut-wrenching. Each one can provide valuable lessons to the entrepreneur. The deal closed only four months later in August of 2012.

How to value your company for sale (Part 2)

A Smart Bear: Startups and Marketing for Geeks

Most entrepreneurs would love to be in a position to have to decide! Remember how the buyer has his own way of valuing the deal ? I just coached an entrepreneur who couldn’t decide whether to accept an offer for selling his business of nine years. Do you prefer Deal B?

Sales 261

Signaling Pricing Expectations Early in Seed Investment Discussions

Genuine VC

As more transparency to seed-round funding transaction details have emerged, especially with the advent of Angelist and accelerator programs (which both educate and even sometimes set terms & structure for graduating companies), I’ve noticed an increasing number of entrepreneurs signal pricing expectations much earlier in the seed fundraising process. By definition, all entrepreneurs should think that their endeavor is truly exceptional.

10 Tips for Startups Raising Money from Angels

VC Cafe

I could write a whole post on the 7-D model students follow (and I probably will) but I’d like to focus on a lecture at the end of the course, by a UK-based angel investor, who provided tips for entrepreneurs to make their company attractive for an angel.

Knowledge Is Power: Convertible Note Financing Terms, Part II

Gust

In this installment, I’ll dig into the “how” by dissecting an example term sheet based on a real deal. A term sheet keeps things relatively straightforward by summarizing the most significant deal terms in outline form, whereas the deal documents themselves (often referred to as definitive agreements ) — even for a relatively simple convertible debt financing — inevitably contain some densely written legalese. These deal terms are simple but significant.

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

Tim Keane

Who the entrepreneur takes money from (see this post ) is always more important than the terms. "  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.    If the entrepreneur can bootstrap.

That convert you raised last year is a part of your cap table

VC Adventure

When it comes to convertible debt, I’ve had a few instances recently where “out of sight, out of mind” has created some misunderstandings around deal structures. Of course many entrepreneurs naturally focus on the main tab of their cap table spreadsheet that shows ownership by founder, investor, etc and for them this is the starting point of negotiating a round.

Knowledge Is Power: Convertible Note Financing Terms, Part V

Gust

As we conclude our convertible note financing series, there are assorted terms commonly seen in term sheets and deal documents that are worth touching on briefly. This is the norm for West Coast deals, but it’s often the case in dealing with East Coast investors (more commonly for VC financing rounds rather than angel seed rounds) that the lead investor wants its lawyers to draft the documents.

Knowledge Is Power: Convertible Note Financing Terms, Part IV

Gust

This week we move on to something near and dear to the hearts of entrepreneurs and investors alike: The exit, more formally known as a “ liquidity event.” To account for scenarios in which the startup is acquired before it has a chance to complete a priced equity financing round, most term sheets and deal documents contain a “ change in control ” provision. Invested Interests angel investment deal terms fundraising startups venture capital

Why Leave A Six Figure Corporate Job For Internet Entrepreneurship?

Entrepreneurs-Journey.com by Yaro Starak

Sunil contacted me asking if he could apply to become a columnist on Entrepreneurs-Journey. I asked him what are the highlights of his “career&# as an entrepreneur so I could be confident in his credibility and he had stories to tell that we could all learn from. For now, Sunil answers the question of why leave a well paying corporate job to become an online entrepreneur… My name is Sunil and the title of this blog post refers to me.

Selling Your Business: An Interview with Louis Crosier

Growthink Blog

Among other impressive accomplishments, Louis is the author of "Selling Your Business: The Transition from Entrepreneur to Investor." Specifically, Louis is an expert on helping entrepreneurs realize their financial dreams by selling their businesses and investing their proceeds wisely. While you can listen to the interview yourself here , two of my favorite points were as follows: -1- Your choice of corporate structure (e.g., Which are the most favorable to the entrepreneur?

Build Your Startup on a Vacant Domain Name

David Teten

That’s why our portfolio company Plated.com decided to structure a lease option – they offered the prior owner a small monthly lease fee for 1 year, with an option to buy at the end of the year. As an entrepreneur, you can identify un-monetized or under-monetized domain names, and then approach the owner with your startup idea. I mentioned earlier World Accelerator.com , a unique accelerator program which helps entrepreneurs build value on top of premium domain names.

Build Your Startup on a Vacant Domain Name

David Teten

That’s why our portfolio company Plated.com decided to structure a lease option – they offered the prior owner a small monthly lease fee for 1 year, with an option to buy at the end of the year. As an entrepreneur, you can identify un-monetized or under-monetized domain names, and then approach the owner with your startup idea. I mentioned earlier World Accelerator.com , a unique accelerator program which helps entrepreneurs build value on top of premium domain names.

Should You Co-Found Your Company With a Software Development Shop (2 of 2)?

David Teten

I’ve seen a range of options for supporting entrepreneurs, which I can rank from least to most involvement in companies by investors: financier VCs, e.g., Correlation Ventures. That said, I’m not sure of the most appropriate structure.

Piercing the Corporate Veil of Sweat Equity

grasshopperherder.com

Three Card Monty Corporate Structures. This is my least favorite thing in the world, being offered sweat equity in a corporate structure that is unnecessarily convoluted. If you’re in a complex structure with several multinational entities, that risk is compounded.

Cracking The Code: The Bessemer 10 laws of SaaS - Fall 2008.

Cracking the Code

A simple example would be if Customer A signs a one-year deal at $10,000 per month, and Customer B signs a three-year deal at $5,000 per month. Consistently delivering a deal per month in this progression gives you a total of 78 months of cumulative recognized revenue.