Startup Professionals Musings

FEBRUARY 27, 2023

Most aspiring entrepreneurs look to their alma mater, or any university, as a source of classes that can help them, but neglect to think outside the box or take advantage of all the other resources to be found there. Access to entrepreneurs-in-residence, business mentors. Access to intellectual property and current research.

Arizona 276

Arizona Intellectual Property Accredited Investor Entrepreneur 276

Startup Professionals Musings

MAY 11, 2011

I often hear the qualms of business-smart but non-technical entrepreneurs, wondering if they really have a chance in this high-technology marketplace. If you are an entrepreneur, like Andrew Mason , CEO of Groupon, with a degree in music and no technical business partner to be found, your job is a bit harder. Marty Zwilling.

Technical Review 236

Technical Review Partner Entrepreneur Architecture 236

Startup Professionals Musings

SEPTEMBER 10, 2018

I always tell entrepreneurs that two heads are better than one, so the first task in many startups is finding a co-founder or two. Of course, all co-founders need to remember that allocated percentages will be diluted as angel and VC investors are brought in. The CFO may have a major financial background, but might be a minority owner.

Equity 238

Equity Cofounder Technical Cofounder Intellectual Property 238

ReadWriteStart

JUNE 1, 2020

I have often been asked about Startup Funding by entrepreneurs. Here is Startup Funding, a Comprehensive Guide for Entrepreneurs. Entrepreneurs are passionate as they want to change the world or solve a problem, but don’t expect the investors to be as passionate as you are about your business. Pre-Requisites of Funding.

Startup 150

Startup Entrepreneur Elevator Pitch Seed Stage 150

Startup Professionals Musings

NOVEMBER 8, 2021

Being called a lifestyle entrepreneur should be a point of pride, not an insult. Of course, even lifestyle entrepreneurs want to be happy, and want their business to be “successful.” Of course, that doesn’t dilute the owner’s equity, but it may well limit you to organic growth, versus international rollouts and acquisition options.

Entrepreneur 371

Entrepreneur Equity Dilution LLC 371

Startup Professionals Musings

DECEMBER 11, 2022

After many years of working with angel investors seriously trying to find new ventures worthy of their hard-earned money, I find their frustration often exceeds that of entrepreneurs sincerely looking for financial help. For seed stage funding, entrepreneurs should be looking to friends and family, crowd funding, and relevant institutions.

Due Diligence 271

Due Diligence Intellectual Property Entrepreneur Preferred Stock 271

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. Some people even believe that entrepreneurs must be born with the right genes, and no element of education is relevant.

Entrepreneur 373

Entrepreneur Chad Incubator Dilution 373

Startup Professionals Musings

SEPTEMBER 13, 2011

Moore titled “ Crossing the Chasm ” (1991), but most entrepreneurs have no idea how it relates to them. It takes focus to resist adding a long list of features that seem to make the opportunity larger, but dilute to focus of both you and potential customers. Everyone in the business world has heard of the book by Geoffrey A.

Marketing 238

Marketing Entrepreneur Technical Review Dilution 238

Startup Professionals Musings

AUGUST 4, 2014

Because these considerations can be quite complex, very emotional and have long-term implications, smart entrepreneurs don’t hesitate to get some legal advice at this early stage, in drawing up an agreement document to be signed by each of the co-founders. Keep your wits about you to make sure that dilution is done equitably and evenly.

Cofounder 261

Cofounder Stock Founder Technical Cofounder 261

Startup Professionals Musings

SEPTEMBER 27, 2023

When an entrepreneur first incorporates a business, they may find themselves the proud owner of 10 million shares of common stock, commonly called founder’s shares. every entrepreneur should incorporate early and file an 83(b) election with the IRS within 30 days of founding the company. This is called stock dilution control.

Stock 240

Stock .Net Vesting Founder Vesting 240

Hearpreneur

JANUARY 30, 2022

So, that’s why we are excited about 2022 because there will be more and more entrepreneurs and businesses. Here are the pivots other entrepreneurs see businesses making this year: #1- More options for solo travelers. The post 30 Entrepreneurs Reveal the Pivots They See Businesses Making in 2022 appeared first on Hearpreneur.

Entrepreneur 122

Entrepreneur Green Technical Review Social Media 122

Both Sides of the Table

MAY 9, 2018

This is a very common scenario when entrepreneurs pitch VCs and frankly is a very common scenario when VCs try to raise money from LPs. At night I had a group dinner where I met 6 new entrepreneurs and hung out with some old friends from law firms, banks and other VC funds. What do I do now? Some were interesting, some weren’t.

Software Review 381

Software Review Churn Rate Due Diligence New York 381

Startup Professionals Musings

APRIL 27, 2019

Moore titled “ Crossing the Chasm ,” but most entrepreneurs have no idea how it relates to them. It takes focus to resist adding a long list of features that seem to make the opportunity larger, but dilute to focus of both you and potential customers. Product development chasm. Another common chasm is never-ending product development.

Technical Review 255

Technical Review Dilution Early Stage Product Development 255

Startup Professionals Musings

JANUARY 15, 2021

When an entrepreneur first incorporates a business, they may find themselves the proud owner of 10 million shares of common stock, commonly called founder’s shares. every entrepreneur should incorporate early and file an 83(b) election with the IRS within 30 days of founding the company. This is called stock dilution control.

Vesting 298

Vesting Dilution Stock Founder Vesting 298

Both Sides of the Table

MAY 28, 2018

One entrepreneur refrain I sometimes hear is “We want to raise some extra money for M&A activities.” Of course there are times where 15% dilution is more appropriate and other times it can be 33% but in a first meeting we’re just trying to establish general ranges for reasonableness. This is a red flag for VCs.

Burn Rate 247

Burn Rate Valuation Pre-Money Valuation Dilution 247

Startup Professionals Musings

AUGUST 24, 2016

I always tell entrepreneurs that two heads are better than one, so the first task in many startups is finding a co-founder or two. Of course, all co-founders need to remember that allocated percentages will be diluted as Angel and VC investors are brought in. The CFO may have a major financial background, but might be a minority owner.

Equity 120

Equity Cofounder Technical Cofounder Intellectual Property 120

Startup Professionals Musings

DECEMBER 16, 2017

Entrepreneurs who require funding for their startup have long counted on self-accredited high net worth individuals (“angels”) to fill their needs, after friends and family, and before they qualify for institutional investments (“VCs”). Here again, the entrepreneur will be the one hurt most, by having fewer funding sources to access.

Angel Investor 190

Angel Investor Accredited Investor IRR Angel Groups 190

Gust

APRIL 11, 2014

Let’s get right down to business: Dilution of founders’ and other early shareholders’ equity in startups is frequently a subject of intense interest and debate. That’s the concept of what some call mathematical dilution. That is not economic dilution, but rather its opposite ( accretion ).

Dilution 162

Dilution Equity Pre-Money Valuation Prospectus 162

Startup Professionals Musings

MAY 9, 2014

Entrepreneurs who require funding for their startup have long counted on self-accredited high net worth individuals (“angels”) to fill their needs, after friends and family, and before they qualify for institutional investments (“VCs”). Here again, the entrepreneur will be the one hurt most, by having fewer funding sources to access.

Angel Investor 278

Angel Investor Angel Groups Accredited Investor IRR 278

The Startup Magazine

MARCH 14, 2022

India has always been renowned as the land of entrepreneurs. The equity dilution at this nascent stage is on desirable terms; such investing can lead to profitable returns. After England, it was India which was described by many as the “nation of shopkeepers”. And this has been the way of life here in India. 2) Seed funding.

Technical Review 144

Technical Review Due Diligence India Startup 144

YoungUpstarts

APRIL 19, 2012

When not approached carefully, growth can destroy value as it outstrips a company’s managerial capacity, processes, quality, and financial controls, or substantially dilutes customer value propositions. Growth requires the entrepreneur to install more processes, procedures, controls, and measurement systems. Growth overwhelmed them.

Dilution 209

Dilution Virginia Management Washington 209

Startup Professionals Musings

OCTOBER 13, 2021

As a long-time business consultant and investor, especially to entrepreneurs, I recognize your sparkle of vision , to build the ultimate world-changing product. I found these maladies summarized well in a new book, “ Radical Product Thinking ,” by entrepreneur Radhika Dutt. While the idea was great, they failed on execution.

Dilution 334

Dilution Metrics Acquisition Revenue 334

Both Sides of the Table

JULY 22, 2010

And for some strange reason entrepreneurs didn’t share this information. I’ve started from day one trying to build total transparency into my process with entrepreneurs. This starts with understanding how VCs and entrepreneurs often see valuation differently. Back then VentureHacks didn’t exist.

Valuation 405

Valuation Liquidation Preference Pre-Money Valuation Term Sheet 405

Startup Professionals Musings

JANUARY 31, 2020

In my work with new startups, I often find people who believe that the terms “ entrepreneur ” and “ inventor ” are interchangeable. In my experience, most successful entrepreneurs have indeed created a new product, but most people who claim to be inventors have a hard time starting a business.

Founder 312

Founder Intellectual Property Dilution Startup 312

Gust

NOVEMBER 1, 2011

in the case of one investment round, no subsequent investment and therefore no dilution). I have seen some complex methods for accommodating anticipated dilution, but here is an easy way to adjust the pre-money valuation of the current round. Then: Post-money Valuation = Terminal Value ÷ Anticipated ROI. million ÷ 20X.

Venture Capital 161

Venture Capital Valuation Pre-Money Valuation Post-Money Valuation 161

The Startup Magazine

AUGUST 9, 2022

TSM: Going back to your early career decisions, tell us what factors influenced your decision to be an entrepreneur? Salo: I think I always wanted to be an entrepreneur without realizing what “entrepreneurship” was or what an entrepreneur is/does. I also happened to love talking to other entrepreneurs.

Cofounder 147

Cofounder Founder Miami Marketing 147

Startup Lessons Learned

JULY 5, 2010

Brant and Patrick undertook a difficult challenge: to provide a generally accessible introduction to Customer Development, without diluting its impact or dumbing-down its principles. The Entrepreneur’s Guide is an easy read. Many “airport business books&# urge entrepreneurs to never give in. I think theyve succeeded.

Customer Development 166

Customer Development Developer San Francisco Customer 166

The Startup Lawyer

MARCH 1, 2011

I hate non-dilution rights and if you are an entrepreneur you should, too. I’m not talking about price-based anti-dilution protection that is typical in an angel or VC round. But the fact that the startup’s founders are being diluted by such an issuance should provide enough protection.

Dilution 89

Dilution Equity Stock Startup 89

Startup Professionals Musings

NOVEMBER 7, 2022

Make sure everyone comes with an entrepreneur mindset for real innovation. In my experience, team members with an entrepreneur mindset are rare in mature companies, due to a growing focus on low risk fixed processes, narrow job roles with specialized expertise, and long-term tenure. Entrepreneurs crave more ownership.

Advisory Board 359

Advisory Board Incubator Dilution Agile 359

Startup Professionals Musings

OCTOBER 7, 2022

One of the big questions that every entrepreneur struggles with is how much funding they should request from investors in the first round. Most professional investors will expect preferred stock, a board seat, rights to later rounds and perhaps anti-dilution protection. Are you flexible on the terms of the investment?

Preferred Stock 304

Preferred Stock Exit Strategy Equity Angel Investor 304

YoungUpstarts

SEPTEMBER 23, 2017

While starting out as an entrepreneur, you won’t have enough cash or experience to start and run a start up on your own, so you may believe it’d be best to include others with more experience to guide you in the direction you’re heading. We all decided right away that we’d put in our own money and sweat as equity.

Cofounder 124

Cofounder Sweat Equity Equity Dilution 124

Up and Running

JULY 2, 2014

of our company in exchange for the $300K, and my business partner and I each diluted from 50% ownership down to 33.3% ownership and never dilute. Now, if you’re a savvy investor or entrepreneur, I’m sure your jaw just dropped as you read that. The deal we made with him was he’d get 33.3%

Technical Review 118

Technical Review Angel Investor Due Diligence Dilution 118

YoungUpstarts

JULY 31, 2019

Billions of dollars are being poured into companies that have yet to clear the value chasm, as entrepreneurs use early traction that isn’t necessarily financially-oriented, but shows a certain level of uptick or success, to raise capital and convince early stage investors that their horse is the one to bet on.

Cofounder 127

Cofounder Burn Rate Technical Cofounder Seed Capital 127

Startup Professionals Musings

MAY 8, 2022

Most entrepreneurs struggle with many startup founders quandaries in building their business, and these key dilemmas are probably the biggest source of pain and failure for the entrepreneur lifestyle. The downside is loss of control and financial dilution. The dilemma is that these goals are usually mutually exclusive.

Founder 325

Founder Hockey Stick Cofounder Liquidity Event 325

ReadWriteStart

JANUARY 27, 2011

This partnership speaks to a core philosophy of the program where we encourage entrepreneurs to get as much customer validation as possible before raising too much money, use other people's channels if you can get to them, don't burn too much cash, and all that good fiscal conservative stuff. LetsGiftIt.

Dilution 114

Dilution Revenue Finance Entrepreneur 114

Startup Professionals Musings

JULY 24, 2022

Every entrepreneur and every company I know has orbit-shifting intentions. Overcoming execution obstacles is combating dilution, not compromising, for these innovators. Entrepreneurs and startups are in the best position to find and run with orbit-shifting rather than linear innovations.

Marketing 313

Marketing Dilution Social Network Government 313

Austin Startup

JULY 6, 2018

Re: cash, the more “unbundled” types of accelerators (less formalized, less equity) tend to not provide any cash upfront, but also typically “cost” less in equity, often just 1–2% of your fully diluted capitalization. Anti-Dilution. See: Startup Accelerator Anti-Dilution Provisions; The Fine Print. Market Focus.

Dilution 48

Dilution Startup Technical Review Equity 48