The Startup Magazine

AUGUST 9, 2022

As part of our Founder interview series , The Startup Magazine caught up with Salo Sterental, Co-Founder of the SoStereo, a marketing firm that enables brands and artists alike to unlock the marketing power of music. Salo: We help brands unlock the marketing power of music. TSM: Music is an important tool in marketing strategy.

Cofounder 148

Cofounder Founder Miami Marketing 148

View from Seed

OCTOBER 24, 2019

The reality is that if a founder raised every one of these rounds, and lead investors always got their “target” ownership, the level of dilution would be ridiculous. No good investor would want the founder/CEO of a company to have insufficient ownership by the series A, and every founder I know is sensitive to taking too much dilution.

Dilution 149

Dilution B2B Burn Rate Early Stage 149

Both Sides of the Table

MAY 28, 2018

There are many things a VC is looking for in reviewing your business plan but beyond things the like the quality of revenue, margins, OPEX and CAPEX there’s a really simple rule I call, “Cash In, Cash Out, Milestones Achieved.” Usually that’s the point in the meeting where a VC realizes that this meeting isn’t going to go very well.

Burn Rate 247

Burn Rate Valuation Pre-Money Valuation Dilution 247

Duct Tape Marketing

OCTOBER 11, 2023

Shattering The Mold: Unleashing the Creator Economy in B2B Marketing written by John Jantsch read more at Duct Tape Marketing The Duct Tape Marketing Podcast with Christie Horsman In this episode of the Duct Tape Marketing Podcast , I interviewed Christie Horsman, who brings a decade of expertise in both B2B and B2C marketing within the SaaS arena.

B2B 80

B2B Marketing B2C Community 80

Both Sides of the Table

MARCH 19, 2013

The line of reasoning goes, “Services businesses are not scalable and the market won’t reward this revenue so make sure that third-parties do your implementation or clients do it themselves. We only want software revenue.” It’s Profitable Revenue Covering Your Fixed Costs. Let me explain why: 1.

Technical Review 403

Technical Review Software Review Startup API 403

Both Sides of the Table

SEPTEMBER 28, 2014

by Michael Woolf that is worth any startup founder reading to get a sense of perspective on the reality warp that is startup world during a frothy market such as 1997-1999, 2005-2007 or 2012-2014. 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.

Burn Rate 383

Burn Rate Balance Sheet .Net Valuation 383

Both Sides of the Table

MARCH 21, 2013

I think it’s important for enterprise startups to layer in professional services into your revenue stream. deliver profitable revenue that while on gross margins of 50% vs. software at 85-95% it is still profits to help you cover fixed costs. Integrate PS Work Into Sales & Marketing Processes. rollout support.

Software Review 321

Software Review Software IP Technical Review 321

YoungUpstarts

JULY 31, 2019

For start-ups in hot markets, the problem also manifests itself in fundraising. Founders need seed capital to get their operations up and running, and to begin generating revenue. The kicker, of course, is that at some point you have to pay that debt down to actually scale. . This also applies in acquisition conversations.

Cofounder 127

Cofounder Burn Rate Technical Cofounder Seed Capital 127

Both Sides of the Table

NOVEMBER 14, 2017

What sized team can I afford in order to sell, market & provide service to these customers? But expanding beyond our core customers was going to take more effort than simply launching in new markets. We realized that operating a business in distributed markets presented multi-city coordination efforts that we weren’t prepared for.

Operations 286

Operations New York City Technical Review Startup 286

Startup Professionals Musings

OCTOBER 13, 2021

For example, a few years ago, the company Beepi had a vision to build a new market for buying and selling used cars, but became overly focused on fundraising to grow fast, and ignored many customer complaints. It’s easy to say “yes” to one more feature request after another, until the potential for real impact gets diluted.

Dilution 334

Dilution Metrics Acquisition Revenue 334

SoCal CTO

SEPTEMBER 27, 2011

I've talked about this topic before in How Investors Think About Valuation of Pre-Revenue Startups. In other words, the loss of compensation for the early employee as compared to market rate should be viewed as equivalent to the equity for that same dollar amount from an investor. Same Value for Sweat Equity as Investment Dollars?

Early Stage 391

Early Stage Equity CTO Hire Sweat Equity 391

This is going to be BIG.

JANUARY 18, 2024

While they might be generally smart, they’re unsophisticated investors who don’t know what the market is for where you are. They might not understand how a pre-revenue startup could be worth anything, let alone be valued at $5mm. How long do they think it will take to make a return if there is one?

.Net 88

.Net Cap Table Startup Technical Review 88

Steve Blank

APRIL 10, 2019

We slept under the tables, and pulled all-nighters to get to first customer ship, man the booths at trade shows or ship products to make quarterly revenue – all because it was “our” company. Before these three went public, they weren’t unicorns – that is their market cap was less than a billion dollars. That made sense.

Stock Options 334

Stock Options Stock Vesting Common Stock 334

Startup Professionals Musings

DECEMBER 11, 2022

Getting investors to trust you with their money is always a challenge, and it’s even more difficult in the early stages, where you don’t have a significant revenue stream, a few customers, or maybe even a product yet. At these stages, it’s all about you, and your ability to communicate and execute effectively. Surprises during due diligence.

Due Diligence 271

Due Diligence Intellectual Property Entrepreneur Preferred Stock 271

Startup Professionals Musings

NOVEMBER 7, 2022

After many years in business, working in large companies as well as startups, I’m no longer surprised at why mature and successful companies struggle with introducing innovative new ventures as the market and environment changes. The time to start is now, with all the volatility and change in the market, and customers looking for answers.

Advisory Board 359

Advisory Board Incubator Dilution Agile 359

A Smart Bear: Startups and Marketing for Geeks

FEBRUARY 26, 2019

They don’t know how to analyze a market or competition, so they make it up instead learning how to do it. The implication is that this was unknowable or bad luck, but the truth is, this was a predictable result of not understanding the market. Sometimes that’s airtight product/market it. Selling to the mid-market is hard.

Restful 202

Restful Founder Revenue Acquisition 202

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. Flexible VC: Revenue -based. Of the Inc.

Cofounder 78

Cofounder Technical Review Equity Dividend 78

Both Sides of the Table

AUGUST 3, 2010

How much dilution should I take for it?&# My friend’s company was pre-revenue. Me: “Zero dilution. It meant that the management teams hadn’t figured out a product / market fit for their own businesses. Want to cut prices and go for market share? BUT … it’s your company. Your choice.

Merger 276

Merger Technical Review Early Stage Dilution 276

ReadWriteStart

JUNE 1, 2020

The primary source of your funds should be your paying customers, i.e., your business should generate enough revenues and profits to fund the growth and expansion. The next reason is to establish a competitive advantage over your competition and quickly acquire a substantial market share. Both of which are expensive and time-consuming.

Startup 150

Startup Entrepreneur Elevator Pitch Seed Stage 150

Up and Running

JULY 1, 2020

You may grow to tap new markets or increase sales in your current markets. While it’s called a business plan, it can be written and utilized to successfully enter a new market, launch a product, or weigh the potential of adding an employee. A business plan for a new employee in a new market.

Business Plan 152

Business Plan Forecast Operations Dilution 152

ReadWriteStart

JANUARY 27, 2011

I have discussed at length why revenue sharing channel deals may serve as perfectly fine alternatives to raising equity (or even complements) because of their non-dilutive nature. I also advised Andrew to greatly tighten his product and go-to-market strategy. million in revenue. Note, I said, validated. Safarclick.

Dilution 114

Dilution Revenue Finance Entrepreneur 114

Both Sides of the Table

SEPTEMBER 17, 2011

.&# Still, I’ll bet that functionally you divide areas of competence like sales & marketing, product, engineering, biz dev, etc. I usually encourage people to think about titles like, “Founder & CTO&# or “Founder & VP Marketing.&#. Dilute your cash, equity or both. and my favorite].

Operations 292

Operations CTO Hire Startup Early Stage 292

Both Sides of the Table

SEPTEMBER 16, 2010

As I’ve highlighted I believe we’re in a unique period similar to 2005-08 where the biggest tech firms of Silicon Valley (and some media companies) are scooping up small software companies as “talent acquisitions&# versus accretive revenue / profit generators. Total disruption on the funding market? I doubt it.

Cap Table 283

Cap Table Angel Investor Liquidation Preference Deal Flow 283

YoungUpstarts

MAY 6, 2019

Market Research. In this stage, you will also search the market to check if your idea is viable. If there is a gap in the market, there will be demand. Now the question is: How to find gaps in the market? MVP is the product that you can bring to the market. Next is marketing. There is a simple rule of thumb.

Startup 113

Startup Technical Cofounder Merger Early Stage 113

Hearpreneur

JANUARY 30, 2022

Thanks to Adam Wood, Revenue Geeks ! #7- Social media is obviously one of the most powerful marketing tools we have at our disposal and it is becoming a non-optional part of a strong marketing strategy. 17- Embrace digital marketing. The way marketing is done is changing. 7- Start outsourcing.

Entrepreneur 124

Entrepreneur Green Technical Review Social Media 124

Startup Professionals Musings

MARCH 14, 2020

Getting investors to trust you with their money is always a challenge, and it’s even more difficult in the early stages, where you don’t have a significant revenue stream, a few customers, or maybe even a product yet. At these stages, it’s all about you, and your ability to communicate and execute effectively. Surprises during due diligence.

Due Diligence 308

Due Diligence Intellectual Property Preferred Stock Seed Stage 308

A Smart Bear: Startups and Marketing for Geeks

MARCH 1, 2010

Hanging your hat on just one advantage that you can own completely is stronger than diluting your message across many advantages. If nothing else, this should get your juices flowing and make future sales calls and marketing messages more effective. Don't dilute your message. Your homepage becomes laser-focused. Most Expensive.

Open Source 239

Open Source Dilution Software Developers Software Development 239

View from Seed

APRIL 30, 2015

In many instances, you raise an institutional round to either fulfill a product strategy or go-to-market strategy or you’re increasing sales and marketing hires, so you have better visibility into what needs to happen in the next six, 12, 18 months. Traction and revenue? These are value-creation milestones. Business model?

Term Sheet 120

Term Sheet Equity Startup Seed Stage 120

Ben's Blog

MAY 24, 2021

House of Representatives’ Subcommittee on Investor Protection, Entrepreneurship, and Capital Markets (Committee on Financial Services) hearing on “Going Public: SPACs, Direct Listings, Public Offerings, and the Need for Investor Protections” May 2021. IPO market. In the first quarter of 2021 alone, SPACs raised $87.9

SEC 36

SEC Accredited Investor IPO Technical Review 36

David Teten

AUGUST 21, 2019

Or should they look to one of the new wave of Revenue-Based Investors? Revenue-Based Investing (“RBI”) is a new form of VC financing, distinct from the preferred equity structure most VCs use. For more background, see Revenue-Based Investing: A New Option for Founders who Care About Control. Less or no dilution.

Revenue 60

Revenue Liquidation Preference Equity Cofounder 60

Both Sides of the Table

OCTOBER 1, 2009

In the first post in this three part series I described why I believe the VC market froze between September 2008 – April 2009. When the market run started in March people were relieved that “the world wasn’t ending” so they started spending again. Unemployment coupled with a stock market drop will stop this spending cold IMHO.

Technical Review 269

Technical Review Stock Hawaii Early Stage 269

Both Sides of the Table

JUNE 17, 2017

70–80% of the costs of most startups are employee costs so what you’re really talking about when a company is unprofitable is that they are growing their staff ahead of their revenue. Revenue When I look at an income statement I start by focusing on the revenue line. You need to understand the “quality” of the revenue.

Stock Options 227

Stock Options Startup Dilution Venture Capital 227

Both Sides of the Table

JUNE 5, 2011

2 preamble issues having read the comments on TC today: 1: I know that the prices of startup companies is much great in Silicon Valley than in smaller towns / less tech focused areas in the US and the US prices higher than many foreign markets. I can’t control the market. Private markets for stocks are the opposite.

Pre-Money Valuation 336

Pre-Money Valuation Valuation Silicon Valley Stock 336

YoungUpstarts

MAY 31, 2016

The single biggest reason that the average company struggles or even fails is due to their lack of focus and dilution of their greatest resource, which are people. Is a marketing plan important? Develop and evolve your company’s product brands through your customer’s eyes. Is high yield important? Are promotional materials important?

Technical Review 100

Technical Review Leadership Early Stage Initial Public Offering 100

Both Sides of the Table

JANUARY 4, 2014

– while the other might want a quick sale and pocket some bucks while the tech market is hot. It either needed to get more aggressive in pricing, pivot to a new business or business model or raise more capital (and take the dilution) in order to have more time to figure things out. Those are the easy cases.

Founder 340

Founder Sacramento Cofounder Technical Review 340

YoungUpstarts

OCTOBER 16, 2016

But entrepreneurs face other concerns that compete with this growth focus, including hiring, maintaining current revenue sources and distinguishing themselves from the competition. As your business thrives, the providers who support you with banking, marketing and other services should change as your demands change.

Cofounder 100

Cofounder Balance Sheet Small Business Administration Technical Review 100

Both Sides of the Table

JULY 16, 2013

Because at least while the VC spigot is open and flowing for high-potential individuals that fit a pattern that some VCs seem to favor they can access cheap capital that isn’t terribly dilutive and can use the to fund development and swing for the fences with limited focus on monetization. And the dilution that goes with it.

Burn Rate 412

Burn Rate Dilution Revenue Valuation 412