Haystack

AUGUST 18, 2019

If you’ve been following my tweets lately, you’ve read some of my quick musings on the state of the seed market this summer. years is not a long arc – I have not experienced a prolonged down market as a private investor. We know private markets hold the key to 100x or even 1,000x multiples. In short, in my 6.5

Seed Stage 108

Seed Stage Cap Table Early Stage Malaysia 108

View from Seed

JUNE 30, 2015

I think it’s much better to think of things in terms of company milestones , which are: Inception –> Early Product-Market Fit –> Strong PMF –> Scaling Growth. Or maybe your market hasn’t quite developed as quickly as you’d hoped. Almost all VCs actually invest across this spectrum.

Seed Stage 120

Seed Stage Syndicate Syndication Dilution 120

View from Seed

JANUARY 26, 2016

There are a number of factors that have contributed to the rise of pre-seed rounds, but the strongest have been the frothy late-stage financing market, coupled with both the scaling-up of some of the early winners in the institutional seed ecosystem and the scaling-down of some larger funds that retrenched after the financial crisis.

Seed Stage 120

Seed Stage Early Stage Cofounder Finance 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. The founder sacrificed having potentially “smarter money” around the table, but got the same amount of dollars in the bank for less dilution.

Cram Down 66

Cram Down Institutional Investors Dilution Seed Stage 66

Hunter Walker

JANUARY 20, 2015

One reason Satya and I thought we had Product Market Fit for starting Homebrew was behavior we saw as angel investors. If you just need the money, stick unknown angels in an AngelList Syndicate so they have more limited information rights. Avoid these folks. You can reference check angels just like you would VCs or employees.

Cap Table 48

Cap Table Warrant Syndicate Syndication 48

Rob Go

AUGUST 26, 2013

Over the past couple years, there has been an emerging bifurcation in the seed investing market. Most seed rounds tended to look like “genesis rounds” This market gap, coupled with the capital efficiency of software brought on the rise of seed funds. in a round was very challenging for most.

Valuation 68

Valuation Seed Stage Syndicate Syndication 68

View from Seed

JANUARY 28, 2016

So when it comes to what the market regards as “pre-seeds,” we simply do the same things we typically do, but slightly tuned to this stage of company. This is the best time to fundraise because that’s when you are able to command a meaningfully higher valuation for your next round to minimize your own dilution.

Cofounder 120

Cofounder Finance Founder Syndicate 120

Professor VC

JULY 25, 2013

Another area where I''m not sure I stand is with some of the more formal referral and syndication programs that are emerging now. AngelList (which I remain a big fan) also recently launched a syndicate program. In this program, an angel can ask the entrepreneur for an allocation of the round and then syndicate through AngelList.

Term Sheet 46

Term Sheet Silicon Valley Syndicate Syndication 46

Austin Startup

MARCH 7, 2021

Texas is the most promising technology market in the United States. If you want to launch a new business, this is a great market to launch from because you can easily reach all of the major Texas cities with one office. The larger Dallas metro-region is the fourth largest in the country and Houston metro-region is the fifth.

Texas 90

Texas San Antonio Houston Dallas 90

Both Sides of the Table

APRIL 3, 2010

They said that they didn’t want the extra money or dilution. Because angels will have their money in real estate, the stock market, etc. In my third seed deal we co-invested with a seed fund and then syndicated the rest to strategic angels. We offered them more : $750k-1 million. We took the $500k.

Venture Capital 265

Venture Capital Term Sheet Early Stage Silicon Valley 265

Both Sides of the Table

FEBRUARY 25, 2010

We were trying to optimize around a few criteria: price, size of round, number of syndicate partners and, of course, terms. But we weren’t optimizing for dilution – we were building a $1 billion+ company and we wanted the runway to succeed. If you remember your history the market crashed the next week. Yes, this was stupid.

Technical Review 301

Technical Review Term Sheet Due Diligence Venture Capital 301

Rob Go

JANUARY 28, 2016

So when it comes to what the market regards as “pre-seeds,” we simply do the same things we typically do, but slightly tuned to this stage of company. This is the best time to fundraise because that’s when you are able to command a meaningfully higher valuation for your next round to minimize your own dilution.

Cofounder 28

Cofounder Finance Founder Syndicate 28

Hunter Walker

SEPTEMBER 5, 2021

I really liked Jason Lemkin’s “ Do You Have a Weak Investor Syndicate ” blog post from earlier in the summer. Since things are going well, our collective belief is that a few more milestones will be rewarded by the market, so let’s push further. Startup CEOs Should Test Strength of Cap Table Every ~6 Months To Know Where They Stand.

Cap Table 95

Cap Table Seed Stage Syndicate Syndication 95

www.paulgraham.com

APRIL 28, 2010

As a company gets more established,its valuation gets closer to an actual market value. Some angel investors join together in syndicates. Whatkind of anti-dilution protection do they want? The angel now owns 200/1200 shares, or a sixth of thecompany, and all the previous shareholders percentage ownershipis diluted by a sixth.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

www.paulgraham.com

APRIL 28, 2010

Mechanics Angel investors often syndicate deals, which means they join togetherto invest on the same terms. In a syndicate there is usually a"lead" investor who negotiates the terms with the startup. Dont feel like you have to join a syndicate, though. Dilution is normal. So its your choicewhether you get diluted. [

Angel Investor 63

Angel Investor Syndicate Syndication Dilution 63

Rob Go

MAY 20, 2014

As seed rounds have become much more common, it’s been said that the “seed is the new series A” This is sort of true – it used to be that Series A’s would often happen pre-product, and certainly before product-market fit. In that case however, the founders might end up taking a lot of dilution.

Valuation 76

Valuation Dilution Post-Money Valuation Syndicate 76

Austin Startup

AUGUST 1, 2017

TL;DR: In a market that has historically idolized huge, splashy financings and exits, an increasing number of entrepreneurs are realizing that everyone else’s definition of success — particularly among certain large VCs — isn’t necessarily aligned with their own.

Liquidation Preference 48

Liquidation Preference Common Stock Valuation Silicon Valley 48