Both Sides of the Table

JUNE 5, 2011

The earlier you invest the higher the chances the company won’t work out and thus you pay a lower price than later-stage investors. Another firm we saw tried to raise $15 million at a $60 million pre-money with similar metrics. So how exactly are prices determined? There is no great science to it. Here’s the problem.

Pre-Money Valuation 336

Pre-Money Valuation Valuation Silicon Valley Stock 336

View from Seed

SEPTEMBER 14, 2021

Warning – this assumes some basic knowledge of VC performance metrics. For context, seed-stage pre-money valuations are up 24% from H1 2020 to H1 2021. Early-stage valuations are up 70%, and late-stage valuations are up 103% (source Pitchbook ). For a primer, I would recommend refreshing yourself here.

Valuation 319

Valuation Pre-Money Valuation Distribution Early Stage 319

Both Sides of the Table

MAY 27, 2016

During the Q&A I was asked about how I make investment decisions in early-stage businesses. I was asked again in an LP meeting later in the week and then again at a founder breakfast gathering we hosted yesterday. I know that sounds trite but it’s the best way I can describe my early-stage investments.

Early Stage 254

Early Stage Non-Compete LP Later Stage 254

View from Seed

SEPTEMBER 14, 2021

Warning – this assumes some basic knowledge of VC performance metrics. For context, seed-stage pre-money valuations are up 24% from H1 2020 to H1 2021. Early-stage valuations are up 70%, and late-stage valuations are up 103% (source Pitchbook ). For a primer, I would recommend refreshing yourself here.

Valuation 295

Valuation Pre-Money Valuation Distribution Early Stage 295

Both Sides of the Table

FEBRUARY 15, 2016

I know it sounds obvious but just so you understand: There are more capital sources available for earlier-stage capital, the information on which they are evaluating the investment is less (it is almost certainly just team and product) and the risk of the investor getting things wrong is diminished. You are in a classic cap table pinch.

Burn Rate 150

Burn Rate Cap Table Valuation Software Review 150

Berkonomics

JUNE 16, 2022

We can invent lots of metrics to measure progress for a leader, including revenue, profit, employee satisfaction, cost containment, percentage of available market, and more. But these are all individual roads to Rio – which is the stated goal for the organization. What is your leadership end game goal?

Later Stage 62

Later Stage Early Stage Valuation Acquisition 62

Steve Blank

JUNE 15, 2010

Certain VC’s like the new class of Super-Angels and small VC funds specialize in the early stage of a startup where you are searching for a business model. And some larger funds that specialize in later stage deals may have a partner or two who likes to invest at this stage. Lean Startups ?

Founder 231

Founder Vesting Later Stage Early Stage 231

David Teten

JANUARY 9, 2018

That said, one limitation in early-stage investing particularly is that 2022’s growth sectors probably don’t fit neatly into a vertical we can define today. Many VCs focus on specific verticals, usually based on the sector in which a VC initially made her reputation. This model certainly makes sense. – Internal diversity.

Venture Capital 60

Venture Capital Private Equity Silicon Valley Differentiation 60

David Teten

JANUARY 9, 2018

That said, one limitation in early-stage investing particularly is that 2022’s growth sectors probably don’t fit neatly into a vertical we can define today. Many VCs focus on specific verticals, usually based on the sector in which a VC initially made her reputation. This model certainly makes sense. – Internal diversity.

Venture Capital 60

Venture Capital Private Equity Silicon Valley Differentiation 60

K9 Ventures

JUNE 5, 2015

I still wanted K9 to be the first institutional money in a company and work with “frighteningly early-stage” companies. As the check size increases, investors tend to look for more traction, established revenue models, proven unit-economics, and other metrics that were previously associated with later stage companies.

Seed Stage 48

Seed Stage Venture Capital Early Stage Valuation 48

View from Seed

SEPTEMBER 14, 2021

Warning – this assumes some basic knowledge of VC performance metrics. For context, seed-stage pre-money valuations are up 24% from H1 2020 to H1 2021. Early-stage valuations are up 70%, and late-stage valuations are up 103% (source Pitchbook ). For a primer, I would recommend refreshing yourself here.

Valuation 156

Valuation Pre-Money Valuation Distribution Early Stage 156

Austin Startup

AUGUST 30, 2018

A tendency towards more money but less deals could be debilitating for early-stage companies. The tens-of-millions-of-dollars rounds aren’t going to the early-stage startups. So while the number of dollars pouring into Austin may be increasing, that metric is only favorable to businesses that warrant those sized-rounds.

Austin 48

Austin Early Stage San Francisco Later Stage 48

cdixon.org

AUGUST 3, 2012

Some observations: - Thousands of early-stage consumer web/mobile companies were started and funded in last 24 months. A few breakout early-stage consumer hits (Instagram, Pinterest) have reached tens of millions of users in record time. Hence, many early-stage consumer startups are switching to transactional models. -

Bridge Financing 86

Bridge Financing Early Stage Valuation Later Stage 86

Rob Go

AUGUST 12, 2013

Call me old school, but I think the impact of quantitative approaches on early-stage investing is pretty over-rated and misunderstood. Data is important and helpful (more on that later) but will not be core to what makes VCs successful, especially when it comes to identifying and sourcing the best early stage investment opportunities.

Hockey Stick 69

Hockey Stick Early Stage Later Stage Metrics 69

Berkonomics

MARCH 31, 2016

We can invent lots of metrics to measure progress for a leader, including revenue, profit, employee satisfaction, cost containment, percentage of available market, and more. But there is one overwhelming method of appraising the effectiveness of a business leader.

Later Stage 48

Later Stage Early Stage Valuation Acquisition 48

View from Seed

JUNE 16, 2015

So, the bar will be different for each investor, and for very early stage fundraising, the goal is to find true believers more than convincing skeptics. (My For series A or later investment rounds, the dynamic is similar, but there are some benchmarks that might be helpful to target to know if you are at least in the ballpark.

Boston 120

Boston Syndication Syndicate eCommerce 120

David Teten

DECEMBER 3, 2019

Data companies focused on early-stage startups include Aingel , fundsUP , Preseries , PredictLeads , and Sploda. Later stage investors are using for sourcing private company marketplace services focused on more established companies, listed below under “Step 11: Exit”. I used Ipreo heavily at one of my prior VC funds.

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

K9 Ventures

OCTOBER 12, 2015

Not to mention that in later stages, high valuations can almost be fatal for some companies that don’t have the operating metrics to justify those valuations once the market turns. This means more noise in the system for seed stage investors. More companies get funded at the early stages.

Venture Capital 48

Venture Capital Seed Stage LP Valuation 48

Rob Go

FEBRUARY 29, 2016

For early stage companies and for our new investment activity: I’m very bullish. Were you chasing the right metrics and did you have the right priorities? And the reality is that later stage companies have so much momentum, that it’s hard to make big changes without taking a lot of damage.

Marketing 28

Marketing Dilution Burn Rate Seed Stage 28

Small Business Force

FEBRUARY 21, 2014

In early stage companies (and even some later stage or mature ones), there is no one area where most entrepreneurs and small business owners are lacking in just basic fundamentals, than in dealing with their company's finances and financial management. Seek discounts and drag out payments to the limit.

Finance 37

Finance Management Forecast Entrepreneur 37

Startup Lessons Learned

JUNE 12, 2009

However, this financial bar has had the effect of excluding one segment of potential customers that Id really like to see there - early stage entrepreneurs who have all the intelligence and vision of their later stage counterparts, but simply cannot afford the cash flow to attend.

Lean 60

Lean Programming San Francisco Continuous Deployment 60

Duct Tape Marketing

SEPTEMBER 22, 2022

17:16] Is there a small set of metrics that you rely on? [19:43] Is there a small set of metrics that you rely on as. Mr. So look, you know, know as a SAS based company, you've got SA classic SA SA metrics and we are a very different organization in terms of marketing than I would say at other kind of corporations or big company.

SEO 84

SEO Channel Campaign Audience 84

Duct Tape Marketing

JANUARY 4, 2023

17:16] Is there a small set of metrics that you rely on? [19:43] Is there a small set of metrics that you rely on as. So the emphasis and the laser focus on metrics is like, not optional. (18:49): 14:08] As a mature organization, how do you balance the need for branding versus the need to acquire more users? [17:16]

SEO 86

SEO Audience Channel Campaign 86

Austin Startup

JUNE 26, 2019

And, there were unexpected delays and conflicts from some incredible innovation partners committed to childcare and early childhood education (ECE). Related: when people say that execution is the most important metric of who will win, keep in mind that executing a fundraise is almost paramount. That’s a metric! Hello Chris Yeh!)

Silicon Valley 54

Silicon Valley Startup B2C Sweat Equity 54

This is going to be BIG.

SEPTEMBER 7, 2012

There are a lot of people that artificially group together performance metrics for venture, and try to extrapolate successful stratagies from it. I think I'm terrific at helping early stage teams by rolling up my sleeves and doing what's necessary--getting them hires, PR, product strategy help to find that market fit.

Later Stage 99

Later Stage Down Round Pre-Money Valuation Early Stage 99

Hippoland

AUGUST 31, 2018

Then I asked him about his metrics, which are good, but they are were not at series A level. All of those investors told him that he was too early. So, I thought it might make sense to take a step back and talk about all the stages of early stage fundraising here in the Silicon Valley. This was surprising to me.

Pre-Money Valuation 90

Pre-Money Valuation Valuation Silicon Valley Early Stage 90

Reid Hoffman

JANUARY 19, 2021

Signing an office lease might not seem like a board-level decision, but with early-stage startups, that lease might very well be a financial liability that significantly exceeds the company’s total cash in the bank. As we discussed earlier, CEO changes rarely make sense in the early stages of a startup.

Startup 36

Startup Cofounder Advertising Hiring 36

Hippoland

AUGUST 31, 2018

Then I asked him about his metrics, which are good, but they are were not at series A level. All of those investors told him that he was too early. So, I thought it might make sense to take a step back and talk about all the stages of early stage fundraising here in the Silicon Valley. This was surprising to me.

Pre-Money Valuation 48

Pre-Money Valuation Valuation Silicon Valley Early Stage 48

abovethecrowd.com

APRIL 20, 2016

Anything that hints of a down round brings questions about the success metrics that have already been “booked.” Some later-stage investors may be tempted to become Sharks themselves and start including structured terms into their own term sheets. Competition also has access to capital. Take as much market share as you can.

IPO 40

IPO Silicon Valley Term Sheet Valuation 40

David Teten

JANUARY 13, 2015

For early-stage founders, I suggest AngelList and Crunchbase. For later-stage companies, I suggest the Association for Corporate Growth online community, Axial , and Preqin. Prove more through metrics. I truly believe in the meritocracy of Silicon Valley – when you have solid metrics.

Venture Capital 60

Venture Capital Advisory Board Greece Cofounder 60

Up and Running

DECEMBER 9, 2014

Maybe you are wondering which metrics to track, or whether or not you should take out a loan for your business. They cover funding for small businesses from the initial funding stage to later stages of growth, and other areas in between. Which metrics do you most rely on to understand your business itself.

Small Business 95

Small Business Finance Forecast Metrics 95

Seeing Both Sides

JANUARY 13, 2015

Some VCs prefer investing at the earliest stages and then cycle off the board of directors. Others prefer to come in at the later stages, post product-market fit, and not have to deal with the risk and roller coaster of the early stages. Financing: Do we have the metrics to support a growth or mezzanine round?

Mezzanine 20

Mezzanine IPO Finance Business Model 20