Startup Professionals Musings

FEBRUARY 18, 2023

If the company has been around for more than a couple of years, and still has no product or revenue flow, there better be a good explanation. Look for examples of similar companies and revenue multiples achieved from acquirers. When did this effort really start, including pivots?

Sweat Equity 207

Sweat Equity Burn Rate Technical Review Intellectual Property 207

David Teten

AUGUST 19, 2019

So you’re interested in raising capital from a Revenue-Based Investor VC. A new wave of Revenue-Based Investors (“RBI”) are emerging. For background, see Revenue-Based Investing: A New Option for Founders who Care About Control. Rational burn profile, up to 50% of revenue at close, scaling down. Bigfoot Capital.

Revenue 60

Revenue Technical Review Software Review Equity 60

VC Cafe

JANUARY 30, 2023

It’s also worth checking YC’s series A due diligence checklist. A data room is a secure repository of information that is shared with potential investors during due diligence. Today, I want to share another resource that is a bit underrated – the data room.

Technical Review 103

Technical Review Due Diligence Cap Table Startup 103

The Startup Magazine

AUGUST 11, 2023

This suggests the firm should have a list of paying customers, consistent sales cycles, a clear value proposition, and a developing revenue pipeline in the ideal situation. Due diligence is often skipped or done on the fly while making direct investments because of the short time available to the investor.

Seed Stage 126

Seed Stage Technical Review Early Stage Due Diligence 126

The Startup Magazine

MARCH 30, 2022

Investing in startups doesn’t have to be as much of a gamble as you might think; it’s all about ignoring the hype and instead letting the underpinnings of the organization, and any performance figures and projections for future revenues, do the talking. Timing is crucial. Rigorous research is your responsibility.

Technical Review 136

Technical Review Due Diligence Angel Investor Startup 136

Both Sides of the Table

SEPTEMBER 15, 2022

Should SaaS companies trade at a 24x Enterprise Value (EV) to Next Twelve Month (NTM) Revenue multiple as they did in November 2021? We drew this conclusion after a meeting we had with Morgan Stanley where they showed us historical 15 & 20 year valuation trends and we all discussed what we thought this meant. What is a VC To Do?

Technical Review 416

Technical Review Pre-Money Valuation San Francisco Valuation 416

Startup Professionals Musings

AUGUST 7, 2020

In the short term you need customers to find you at any price, and in the longer term you need revenue, profit, and return loyalty. Hone your process for due diligence and integrating these new elements. Even a million users on your social media site won’t pay the bills until you sell some advertising or a premium service.

Technical Review 312

Technical Review Due Diligence Merger Social Media 312

Startup Professionals Musings

JULY 1, 2020

The norm for entrepreneurs is to be optimistic on revenue projections, and miserly on funding needs. Just don’t take the “shortcut” of not doing your due diligence on aspiring team members, strategic partners, investors, or vendors. Cheaper in the beginning can be more costly in the long run.

Due Diligence 306

Due Diligence Entrepreneur Startup Acquisition 306

Startup Professionals Musings

SEPTEMBER 24, 2018

Some analysis and due diligence along the following lines should be performed on every idea, as a reality check, before committing your efforts and other people’s money to building a business: Look for places where competitors are few. Even good social causes need to bring in revenue to continue their worthy efforts.

Technical Review 208

Technical Review Due Diligence Intellectual Property Internet 208

YoungUpstarts

MAY 18, 2015

The task of vetting a business prior to a potential purchase is referred to as due diligence. The time saved can be put towards revenue-generating activities and possibly go well past paying the charge of the CPA. Most speculators will find the due diligence process to be tedious at best. Efficiency is essential.

Due Diligence 100

Due Diligence CPA Merger Acquisition 100

Feld Thoughts

AUGUST 25, 2020

Primary learnings for the fellows include: Originating investment opportunities Conducting due diligence Syndicating transactions Executing transactions Supporting founders and portfolio companies.

Technical Review 100

Technical Review Due Diligence Syndicate Syndication 100

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. Surprises during due diligence. Dysfunctional or non-functional team members.

Due Diligence 271

Due Diligence Intellectual Property Entrepreneur Preferred Stock 271

David Teten

AUGUST 19, 2019

A new wave of Revenue-Based Investors are emerging who are using creative investing structures with some of the upside of traditional VC, but some of the downside protection of debt. I believe that Revenue-Based Investing (“RBI”) VCs are on the forefront of what will become a major segment of the venture ecosystem.

Revenue 60

Revenue Term Sheet Founder Technical Review 60

Startup Professionals Musings

SEPTEMBER 27, 2014

Some analysis and due diligence along the following lines should be performed on every idea, as a reality check, before committing your efforts and other people’s money to building a business: Look for places where competitors are few. Even good social causes need to bring in revenue to continue their worthy efforts.

Technical Review 267

Technical Review Due Diligence Entrepreneur Intellectual Property 267

Startup Professionals Musings

APRIL 8, 2015

If the company has been around for more than a couple of years, and still has no product or revenue flow, there better be a good explanation. Look for examples of similar companies and revenue multiples achieved from acquirers. due diligence employees investors startup' When did this effort really start, including pivots?

Technical Review 120

Technical Review Due Diligence Sweat Equity Burn Rate 120

VC Cafe

SEPTEMBER 10, 2021

My 12 year old daughter, who kindly agreed to help with due diligence, is a big fan of Toya’s games because the games allow her to role-play, interact with friends, be social and express herself by creating her own story through digital items. Revenue in Q2 2021 was up 127% to $454.1m. . My Farm by Toya. million to 42.1

Technical Review 178

Technical Review South Korea Due Diligence IP 178

YoungUpstarts

AUGUST 10, 2017

Startups don’t demonstrate due diligence. Investors want to see in-depth financial reports that reinforce the startup has an organized business model with potential for revenue growth. Here are the biggest bookkeeping mistakes I consistently see that prevent startups from raising money: 1.

Software Review 124

Software Review Technical Review Due Diligence Startup 124

YoungUpstarts

MAY 23, 2018

They’re people who like to build things, or they’re people who like to connect with others, but they’re rarely people who like to fill in spreadsheets and review reports and come up with predictive data models that tell them how long they can keep operating on their current revenue. Often, founders have an entrepreneurial mindset.

Due Diligence 133

Due Diligence Startup Finance Leadership 133

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. Surprises during due diligence. Dysfunctional or non-functional team members.

Due Diligence 308

Due Diligence Intellectual Property Preferred Stock Seed Stage 308

NZ Entrepreneur

SEPTEMBER 29, 2021

Addressing real world problems, they thrive in uncertainty, generating new jobs and new revenue streams in new markets. Take part in startup investment due diligence. If you are asked to be on a startup board, be sure to do due diligence on the venture and the team. This is a good place to start.

Technical Review 88

Technical Review Software Review New Zealand Due Diligence 88

The Startup Magazine

JUNE 2, 2021

Thus, as a merchant, if you don’t accept any of these payment types it could cause you to lose out on sales revenue from consumers who use them. For merchants who have many younger customers who are more inclined to utilize these methods, this can represent significant lost revenue.

Management 113

Management eCommerce Technical Review Due Diligence 113

YoungUpstarts

SEPTEMBER 12, 2018

Research shows that companies with greater gender and racial diversity drive nearly 15x more sales revenue than companies with homogenous teams, proving that it literally pays to build an inclusive team. When you think you’ve found the right hire, do your due diligence to ensure it’s a two-way fit. Foster what you find.

Hiring 100

Hiring Technical Review Silicon Valley Due Diligence 100

YoungUpstarts

DECEMBER 14, 2016

Watch out for complex areas such as accounting for revenue, inventory, contingencies, equity instruments and consolidation. If this is a potentially convoluted area for your business, it’s a good idea to clean it up prior to entering due diligence. Books and records. Tax positions and filing requirements.

Acquisition 100

Acquisition Intellectual Property Technical Review Due Diligence 100

Growthink Blog

DECEMBER 27, 2017

Be prepared for due diligence. It’s critical that the data you present is verifiable, since any serious investor will conduct extensive due diligence. Detail all revenue streams. Be sure to include all revenue streams. Be sure to explain how your company would overcome potential negative trends.

Venture Capital 129

Venture Capital Business Plan Technical Review Private Placement 129

YoungUpstarts

NOVEMBER 20, 2019

You may be able to generate revenue, but VCs want exponential growth. At the end of the pitch, ask them about their time frame for completing due diligence and their decision-making process. Like you, they’re looking for opportunity. Be ready when it counts. and give them the opportunity to ask you some questions as well.

Technical Review 140

Technical Review Due Diligence Early Stage Differentiation 140

Startup Professionals Musings

MAY 27, 2016

That may be an extreme case, but I’ve found that even with the proposals that include compelling paradigm shifts in technology, a hard look at the entrepreneur is often the most significant due-diligence that an investor can undertake. Even social entrepreneurs need milestones, quantifiable results, and revenue to sustain their value.

Technical Review 134

Technical Review Intellectual Property Due Diligence Angel Investor 134

David Teten

JULY 24, 2019

Here’s how to do your due diligence first. Earn more consulting revenue from expert networks. True Search. ZRG Partners. Further reading: Ready to join a new management team? How to Sell Your Professional Background. How operating executives can work with the private equity and VC industry.

Venture Capital 60

Venture Capital Private Equity Technical Review North America 60

Startup Professionals Musings

APRIL 10, 2016

If the company has been around for more than a couple of years, and still has no product or revenue flow, there better be a good explanation. Look for examples of similar companies and revenue multiples achieved from acquirers. When did this effort really start, including pivots?

Sweat Equity 120

Sweat Equity Burn Rate Technical Review Intellectual Property 120

NZ Entrepreneur

DECEMBER 10, 2020

The snowball effect meant one person’s confidence inspired the next which Sutton says reduced the due diligence workload for him. “I was then able to say to the rest of the angel groups that the others invested.”. He found many private investors were interested in him as much as StockTrim. “It Lesson 9.

Technical Review 103

Technical Review Software Review Due Diligence Startup 103

Board Effect

APRIL 28, 2021

IRS Form 1023 (titled Application for Recognition of Exemption Under 501 of the Internal Revenue Code) is an official IRS tax form that the IRS uses for nonprofits to apply for tax-exempt status. Due Diligence in Applying for 501(c)(3) Status. IRS Form 1099. Form 1023 is very important at the start of the process.

Software Review 98

Software Review Technical Review Due Diligence Government 98

YoungUpstarts

SEPTEMBER 15, 2015

Here are seven ways that advisors can immediately help your small business achieve the next level of success: Assist With Strategies & Connections to Have Record Revenue & Profit in 2016. Have a CTO Advisor Provide Their Guidance & Due Diligence Suggestions on a Large Upcoming Technology Expenditure.

CTO Hire 100

CTO Hire Fractional CTO Small Business Hiring 100

Up and Running

MARCH 14, 2018

Your revenue or business model. Show what you’re projecting in revenue (per product) over the next three to five years. Show you’ve done some due diligence on this exit strategy, including the companies you’re targeting, and why it would make sense three, five, or 10 years down the road. How will you make money ?

Hockey Stick 164

Hockey Stick Exit Strategy Technical Review Angel Investor 164

Both Sides of the Table

OCTOBER 19, 2014

Again, I think the company would slug me if released revenue data, but … wow. By September 26th we had submitted a term sheet which was signed on October 4th and financing was closed in less than 30 days. So I hope that offers you insights into how companies move through the VC system. Domain Knowledge. Clear path to execution.

Technical Review 373

Technical Review North America Los Angeles Cofounder 373

Startup Professionals Musings

JULY 9, 2021

I suggest a simple Excel spread sheet loaded with your revenue, cost, and margin targets covering the first five years of your business. Investors will expect it for due diligence.

Elevator Pitch 390

Elevator Pitch Entrepreneur Due Diligence Angel Investor 390

Startup Professionals Musings

SEPTEMBER 14, 2022

I recommend you work only with financial and broker organizations who have done the due diligence required, and who have a track record of success. It better be an established company, with millions of dollars in annual revenue and profits, following generally accepted accounting, reporting, and audit procedures.

Merger 261

Merger OTC IPO Due Diligence 261

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

Up and Running

SEPTEMBER 8, 2014

get to revenue, b.) how many customers you’ll acquire and when, how many you’ll retain in year one, how many will churn out (leave you), the average revenue each customer will spend, etc.). This is when you start sharing stuff about your market potential without having first done some deep due diligence on your market opportunity.

Hockey Stick 114

Hockey Stick Technical Review Due Diligence Seattle 114