Cracking the Code

FEBRUARY 23, 2011

It would have been easy to explain the difference by changes in the 2010/2011 revenue growth projections but unfortunately that is not the case. In comparison, the overall technology sector growth was projected at 9-10% in early 2010 and this forecast did not change significantly today. revenues while large caps are trading at 6.4x.

Software Review 101

Software Review Technical Review Valuation Europe 101

The Equity Kicker

DECEMBER 2, 2015

Mahesh Vellanki from Redpoint put up an interesting post yesterday about ecommerce valuations. His major point is that revenue multiples aren’t that high, largely because the market is highly competitive and margins are low – often because of Amazon. revenue multiple because it’s strong on both these metrics.

Forecast 60

Forecast eCommerce Net Present Value Revenue 60

David Teten

AUGUST 6, 2015

So often I speak with companies that have charged ahead building an ultra-complex daily or weekly model with thousands of assumptions and complex dashboard outputs, when their potential investors simply want a high-level 24 month forecast with 12 months of reconciling historical data.”. HOW TO MAKE YOUR CELLS READABLE.

Balance Sheet 60

Balance Sheet Software Review Forecast Acquisition 60

Up and Running

OCTOBER 3, 2018

Set a specific time each month to review it , comparing forecasts to actuals and revising as necessary. Financial Summary: Explain your business model, startup costs, revenues, and liabilities to the company. Milestones and metrics that you’ll need to hit to be viable. Milestones and metrics. Be specific. Financial plan.

El Paso 61

El Paso Business Plan Technical Review Forecast 61

The Next Web

FEBRUARY 27, 2014

One of the questions I get, more often than not, is what is the appropriate valuation of my business. multiple interested investors competing for the deal, and driving up your valuation in the process). Never have an investor think they are the only investor pursuing your business, as that will hurt your valuation.

Valuation 167

Valuation Forecast Seed Stage .Net 167

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. What I did is I learned the art of a pro forma and the value of a pro forma which basically is a forecast. Which metrics do you most rely on to understand your business itself. Two, revenue. What do you do?

Small Business 95

Small Business Finance Forecast Metrics 95

Agile VC

MAY 26, 2011

In another we decended into a debate about our 5 year forecasts (I built the models so fielded most of these questions), and it became clear they probably weren’t the best fit for our Series A round (this group is no longer in the early-stage VC business). It was a pretty good valuation for the time. It was a $4.7M

Term Sheet 178

Term Sheet Silicon Valley Technical Review Social Network 178

David Teten

SEPTEMBER 23, 2017

An investor had few hard metrics other than the actual financials, and little technology to make the process scaleable. Over the past few decades, better metrics became available, and investors could take a more analytical, data-driven approach. ” Historically, investing was a manual, artisan process.

Private Equity 60

Private Equity Venture Capital Equity Technical Review 60

Startup Professionals Musings

AUGUST 13, 2012

In fact, a business plan is needed more by you than investors, as the blueprint for your company, team communication, and progress metrics. Clearly define the customer, channel, and revenue model associated with this solution. In this section, you need to be passionate about revenue, profit, and volume growth. Exit strategy.

Business Plan 283

Business Plan Sweat Equity Exit Strategy Intellectual Property 283

Cracking the Code

MARCH 12, 2010

So, here is the first edition, including the recent Q4 2009 earnings and the updated 2010 forecast. Given the predictability of SaaS GAAP revenues on a quarterly basis, the fact that the 08/09 projections were unchanged is not a surprise. Detailed SaaS Spreadsheet (Valuation and CAC benchmark). SaaS 13 Index Valuation.

Software Review 63

Software Review Technical Review Cloud Forecast 63

Startup Professionals Musings

MAY 13, 2011

In fact, a business plan is needed more by you than investors, as the blueprint for your company, team communication, and progress metrics. Clearly define the customer, channel, and revenue model associated with this solution. In this section, you need to be passionate about revenue, profit, and volume growth. Exit strategy.

Business Plan 290

Business Plan Sweat Equity Exit Strategy Intellectual Property 290

Ben's Blog

AUGUST 17, 2020

OH in South Park, San Francisco (or on Zoom from Big Sky, Montana): “OMG, crazy – that firm just paid 100x revenue to invest in [insert hot startup here] – what could they be thinking?” How valuation multiples work Why did multiples become a shortcut-heuristic for estimating valuations in the first place?

Valuation 36

Valuation Balance Sheet Cofounder Forecast 36

Startup Professionals Musings

AUGUST 8, 2016

Remember you can’t sustain a business or social cause with no revenue or profit. The smart ones identify and budget innovative approaches, and use metrics to tools to monitor effectiveness. Generate a 5-year financial forecast from opportunity data. Be able to differentiate your offering from competitors.

Intellectual Property 120

Intellectual Property Entrepreneur Elevator Pitch Exit Strategy 120

Startup Professionals Musings

AUGUST 7, 2015

Every customer understands that your solution has to generate more revenue than cost, but you should not put that data in a customer pitch. Of course, these should never be in a customer pitch, but investors expect an overall strategy with specific budgets, milestones and metrics. Immediate investment requirements and use of funds.

Product 120

Product Intellectual Property Liquidity Event Burn Rate 120

Startup Professionals Musings

OCTOBER 12, 2010

That’s because a company’s value is a composite of all of the quantitative and qualitative factors that comprise a company: revenues, expenses, risks, growth prospects, quality of the management team, competitive advantages, strength of the intellectual property, and so forth. In business, one important measure is the value of the company.

Intellectual Property 223

Intellectual Property .Net Valuation Distribution 223

Duct Tape Marketing

JUNE 20, 2023

12:22] Would you look at the value derived by digital technologies differently than by producing customer value or revenue? [14:23] And the model we had in mind, there's a book called Valuation, which our, our firm has had an updated every year for the past 20 years or more. So this was a very conscious step on our part.

Technical Review 66

Technical Review Silicon Valley Generative AI Arizona 66

Gust

AUGUST 5, 2012

In fact, a business plan is needed more by you than investors, as the blueprint for your company, team communication, and progress metrics. Clearly define the customer, channel, and revenue model associated with this solution. In this section, you need to be passionate about revenue, profit, and volume growth. Exit strategy.

Business Plan 182

Business Plan Sweat Equity Exit Strategy Intellectual Property 182

Berkonomics

DECEMBER 19, 2013

Revenue projections: What will happen to the company if the revenues and earnings projected on a worst case basis are not achieved as predicted? Valuation and fund-raising : How did you arrive at your proposed pre-money valuation? When and under what conditions should the CEO and management of the company be changed?

Pre-Money Valuation 105

Pre-Money Valuation Liquidity Event Cofounder Valuation 105

Startup Professionals Musings

APRIL 22, 2010

In fact, a business plan is needed more by you than investors, as the blueprint for your company, team communication, and progress metrics. Clearly define the customer, channel, and revenue model associated with this solution. In this section, you need to be passionate about revenue, profit, and volume growth. Exit strategy.

Business Plan 186

Business Plan Exit Strategy Sweat Equity Intellectual Property 186

Cracking the Code

JANUARY 22, 2009

For SaaS companies, we found that MRR is the best metric on which to base sales commissions. While it may make sense to offer very slight adjustments for favorable payment terms and one time revenue, net additions to MRR should dominate the sales rep’s thoughts. How do you clawback revenue from the sales guy? Cindy said.

Software Review 91

Software Review Clawback Sales Salary 91

Cracking the Code

SEPTEMBER 2, 2008

The Deutsche Bank report has a very interesting chart on the topic presenting the Free Cash Flow margins vs. the revenue growth four years post IPO for select software leaders: As you can see, with 20% Free Cash Flow margin and a 50% growth rate, Salesforce is well positioned in the pack! SaaS 13 Index Valuation. for Lawson?

Software Review 48

Software Review Software Technical Review Cloud 48

David Teten

AUGUST 7, 2019

Likely signs of a Value investment: the company has challenges in filling out the round; the investors have more negotiating leverage than the founders during the closing process; the company has significantly better metrics (e.g. LTV / CAC, revenue growth, etc.) THEREFORE: we don’t need to be valuation-sensitive.

Venture Capital 60

Venture Capital Valuation Stock NDA 60

Austin Startup

SEPTEMBER 17, 2017

Further, you demonstrate on your spreadsheet that a venture return to early investors is plausible at a valuation that gives you enough equity to get the job done and to take care of you and your team at exit time. But, the manner in which you get paid can swing your valuation considerably.

Valuation 48

Valuation Forecast Seed Money Business Model 48

Startup Professionals Musings

NOVEMBER 2, 2018

As an investor myself, I look for a balanced story focused on the major elements that drive profitability, including the following: A 5-year financial forecast achieving a positive cash flow early. You need some innovative new approaches, including digital marketing, as well as metrics to measure effectiveness.

Intellectual Property 48

Intellectual Property Initial Public Offering Merger Acquisition 48

Up and Running

MAY 15, 2019

Within any model, there are things breweries can focus on to stand out and increase revenue. There are overhead tradeoffs, but I’m seeing it more and more.” “It helps you plan, helps you get a return, and ultimately helps you generate revenue.”. Metrics: Know your numbers. Managing your own distribution is ideal.

Oregon 24

Oregon Jordan Software Review Distribution 24

Duct Tape Marketing

DECEMBER 14, 2017

We’ve had over 20,000 people download that free tool that we built, and the key metric there is if somebody has used that free tool, their conversion rate on our paid product is three times higher than those who have not. Matt Watson: That worked well for us. We built a product two years ago that’s been very successful for us.

Kansas City 40

Kansas City CTO Hire Las Vegas Software Developers 40