Startup Professionals Musings

AUGUST 7, 2015

Remember, investors are buying into the business, not the product. Investors are business experts, while the entrepreneur is more likely the product expert. In my experience, the team's credentials are more important than the product. Specific elements of your marketing and sales plans.

Product 120

Product Intellectual Property Liquidity Event Burn Rate 120

Startup Professionals Musings

AUGUST 10, 2019

No one wants to put in money until you have a product, and you need money to build the product. Startups are usually founded by product or service experts who don’t enjoy the various growth phases. The right investors and right time dilemma. Bootstrap if you can, otherwise climb the pyramid of family, friends, angels, and VCs.

Hockey Stick 243

Hockey Stick Cofounder Liquidity Event Startup 243

Up and Running

SEPTEMBER 19, 2017

Rule 1: Bootstrap until you have a viable product. Seeking that funding prior to launching a viable product, however, would have virtually ensured that Klemm would largely cede control of the company to PE investors. Takeaway lesson: A shocking number of technology startups never even get their first product out the door.

Private Equity 94

Private Equity Pre-Money Valuation Equity Startup 94

VC Adventure

JULY 15, 2021

One thing I’m particularly proud of in my career is founding Pledge 1% , an organization that encourages companies to give back to their communities by donating a portion of equity, profit, time, or product to nonprofits in its community. You can read the full announcement on Business Wire here.

Liquidity Event 108

Liquidity Event Equity Portfolio Community 108

Gust

DECEMBER 1, 2011

In most cases, the answers are (1) an outstanding product or technology; (2) a successful growth business built around that product; and (3) a top-notch team to build and execute the business. To add insult to injury, the more spectacularly successful the company, the more costly the mistakes can be.

IP 114

IP Intellectual Property Equity Liquidity Event 114

Startup Professionals Musings

DECEMBER 14, 2014

No one wants to put in money until you have a product, and you need money to build the product. Startups are usually founded by product or service experts who don’t enjoy the various growth phases. The right investors and right time dilemma. Bootstrap if you can, otherwise climb the pyramid of family, friends, Angels, and VCs.

Hockey Stick 268

Hockey Stick Cofounder Entrepreneur Liquidity Event 268

Women Entrepreneurs Can

NOVEMBER 19, 2022

They can also help you develop your product and sales channels. Investors receive a healthy return on investment when the company reaches a liquidity event. This is usually done through a prototype , which shows the key characteristics of your product. They also look for a robust business model and product/market fit.

Venture Capital 52

Venture Capital Early Stage Liquidity Event SEC 52

Steve Blank

JUNE 23, 2016

Second, the leaders of these companies tended to be those who excelled at finance, supply chain or production. ARM, a competitor, not only had a better, much lower power processor, but a better business model – they licensed their architecture to other companies that designed their own products.

Architecture 227

Architecture IRR Balance Sheet Liquidity Event 227

Berkonomics

JANUARY 5, 2023

Accounting and HR operations are combined as quickly as possible, as are customer service call centers, retaining specific product skills on the front line from the acquired company. The best performers from the acquired become candidates to outrank or replace their counterparts, showing that a business combination is not all one–sided.

Acquisition 62

Acquisition .Net Retention Sales 62

Pascal's View

DECEMBER 17, 2012

Responding to the question “ What do you see as the biggest investment opportunity for venture capital in 2013? ”, Dougherty said, “ If we have a broadly rebounding economy, the big corporations would begin to buy products and programs that they want to have, not just the ones that they have to have. I agree with Dennis.

Acquisition 38

Acquisition Merger Covenant Liquidity Event 38

Startup Professionals Musings

AUGUST 19, 2017

No one wants to put in money until you have a product, and you need money to build the product. Startups are usually founded by product or service experts who don’t enjoy the various growth phases. The right investors and right time dilemma. Bootstrap if you can, otherwise climb the pyramid of family, friends, angels, and VCs.

Hockey Stick 144

Hockey Stick Cofounder Entrepreneur Liquidity Event 144

Hunter Walker

MARCH 8, 2014

Your Work Will Matter : Past the point of product market fit, but before large company ossification. At a brand new startup you spend all your time trying to get the world to care about your product and fighting a lack of infrastructure. Here’s why: 1.

Liquidity Event 134

Liquidity Event Early Stage Seed Stage Startup 134

Berkonomics

SEPTEMBER 20, 2018

Most entrepreneurs and certainly all investors would like to see “a positive liquidity event” (a good sale of the business) someday. This could be our intellectual property, our geographic reach, our superior product, our management team, or perhaps our dominant position. So, that’s the reason for this insight.

Liquidity Event 48

Liquidity Event Intellectual Property Naming Acquisition 48

Berkonomics

AUGUST 3, 2023

Some businesses require very little capital and the founder can self-finance the enterprise and retain 100% of its ownership and control from ignition through liquidity event (startup through sale). For those of you who fit that description, nice work. There is a lot to say about retaining control.

Private Equity 118

Private Equity Valuation Cap Table Accredited Investor 118

Berkonomics

OCTOBER 28, 2021

You probably know, and I’m just lecturing here, that this is the actual market you measure for your product or service, since it is limited to those who use or can use your offering and those you can reach. So, is your (SOM) serviceable obtainable market large enough? This lesson is important. .

Liquidity Event 62

Liquidity Event .Net Differentiation Entrepreneur 62

Steve Blank

JULY 19, 2010

In their mind, since they thought of the idea of the company, spec’d the product, found the first customers and worked their tails off, they are entitled to vest all their stock over time and run their company. Where’s My Liquidity Event. If you don’t find this business model there is no company.

Vesting 251

Vesting Liquidity Event Venture Capital Founder Vesting 251

Startup Professionals Musings

JULY 19, 2013

No one wants to put in money until you have a product, and you need money to build the product. Startups are usually founded by product or service experts who don’t enjoy the various growth phases. The right investors and right time dilemma. Bootstrap if you can, otherwise climb the pyramid of family, friends, Angels, and VCs.

Founder 245

Founder Hockey Stick Cofounder Liquidity Event 245

Berkonomics

MARCH 21, 2019

To grow your business to a size that will be attractive to a VC or angel making an investment now, you’ve got to show that the business will be large enough at the time of the investor’s liquidity event (cashing out) to make the investment attractive at all. So, you’ve got to play with the numbers to determine your level of comfort.

Hockey Stick 63

Hockey Stick Liquidity Event Valuation Balance Sheet 63

Startup Professionals Musings

DECEMBER 11, 2015

When comparing competition, don’t use fuzzy terms such as improved usability, faster, less expensive and more productive. Investors need a liquidity event to get their money out. Most large competitors no longer do new products internally and are looking to partner and invest if you don’t declare war.

Intellectual Property 120

Intellectual Property Liquidity Event Exit Strategy Angel Investor 120

Startup Professionals Musings

FEBRUARY 13, 2016

Investors are looking for a concise description of your product or service without technical jargon or fuzzy marketing terms with value quantified in customer terms. Since investors are buying a part of your company (not your product), this is the most important question, and is one often not answered.

Sweat Equity 120

Sweat Equity Advisory Board Liquidity Event Startup 120

Berkonomics

SEPTEMBER 19, 2013

It is up to management to scale the development, marketing and production based upon resources available. The liquidity event and beyond' Most failed entrepreneurs blame undercapitalization for the cause of the failed business. Investors do not like to hear this excuse, even if absolutely true. Any business can use more money.

Liquidity Event 81

Liquidity Event Angel Investor Email Entrepreneur 81

Berkonomics

DECEMBER 28, 2017

As you follow these insights from ignition to liquidity event, you’ll detect a continuing theme, emphasizing the need for deep and wide relationships that the CEO and senior staff can call upon for advice and guidance. Forming business relationships at the highest level. Analyzing your commitments of time to business.

Balance Sheet 97

Balance Sheet Liquidity Event Government Restful 97

Startup Professionals Musings

SEPTEMBER 7, 2015

Entrepreneurs often ask me why investors expect financial projections for a new startup even before the product is built and while the market is still being defined. Show a liquidity event and investor return at the end of the period. You shouldn’t invest in an undefined business.

Liquidity Event 120

Liquidity Event Startup Initial Public Offering Equity 120

Startup Professionals Musings

AUGUST 13, 2012

Every plan must start with the problem you are solving, not a description of your company and product. This is not the place for a detailed product specification, but an explanation of how and why it works, including a customer-centric quantification of the benefits. Solution and benefits. Skip the technical jargon and hyperbole.

Business Plan 283

Business Plan Sweat Equity Exit Strategy Intellectual Property 283

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. Founders take a lot less risk, raise multimillion-dollar seed rounds and have the ability to cash out way before a liquidity event.

Stock Options 333

Stock Options Stock Vesting Common Stock 333

Austin Startup

MARCH 27, 2012

The panel was full of tech CEO's who had seen liquidity events in the past year. Apparently he's been pioneering new methods for team productivity with his new company. The four people on stage represented about a billion dollars in exits for Austin tech companies. Craig had just sold LifeSize Communications to Logitech.

Liquidity Event 70

Liquidity Event Austin Product 70

Startup Professionals Musings

MAY 13, 2011

Every plan must start with the problem you are solving, not a description of your company and product. This is not the place for a detailed product specification, but an explanation of how and why it works, including a customer-centric quantification of the benefits. Solution and benefits. Skip the technical jargon and hyperbole.

Business Plan 290

Business Plan Sweat Equity Exit Strategy Intellectual Property 290

Steve Blank

MARCH 18, 2011

The reward for doing so was a liquidity event via an Initial Public Offering. Startups needed millions of dollars of funding just to get their first product out the door to customers. A hardware startup had to equip a factory to manufacture the product. Here’s how: Order of Battle. Wide Adoption.

Internet 334

Internet IPO Silicon Valley Agile 334

Berkonomics

AUGUST 27, 2020

Bankers, investors, strategic partners, and ultimately your buyer or even attorneys providing opinions for an IPO, will all be most impressed by your thoughtful early management decision to make their lives easier and their job more productive. The post What’s a “data room” and how do you use it? first appeared on BERKONOMICS.

Software Review 62

Software Review Due Diligence Intellectual Property IPO 62

Berkonomics

SEPTEMBER 13, 2011

This could be your intellectual property, your geographic reach, your superior product, your management team, or perhaps your dominant position. Next, have the group focus upon column three, ignoring the obvious gain our company would make in liquidity to shareholders. It is in revisiting column two of the chart.

Intellectual Property 67

Intellectual Property Liquidity Event Acquisition Distribution 67

Gust

AUGUST 5, 2012

Every plan must start with the problem you are solving, not a description of your company and product. This is not the place for a detailed product specification, but an explanation of how and why it works, including a customer-centric quantification of the benefits. Solution and benefits. Skip the technical jargon and hyperbole.

Business Plan 182

Business Plan Sweat Equity Exit Strategy Intellectual Property 182

YoungUpstarts

MARCH 11, 2015

This can result in value even if the company has not sold one product! Usually valuations for startup companies are performed using either projected financial statements or implied using the price paid for a recent round of financing. Common shares can have value, even if other stakeholders contractually get paid first.

Valuation 100

Valuation Stock Options CPA Merger 100

Startup Professionals Musings

APRIL 22, 2010

Every plan must start with the problem you are solving, not a description of your company and product. This is not the place for a detailed product specification, but an explanation of how and why it works, including a customer-centric quantification of the benefits. Solution and benefits. Skip the technical jargon and hyperbole.

Business Plan 186

Business Plan Exit Strategy Sweat Equity Intellectual Property 186

Berkonomics

JUNE 8, 2017

Some businesses require very little capital and the founder can self-finance the enterprise and retain 100% of its ownership and control from ignition through liquidity event (startup through sale). For you who fit that description, nice work. There is a lot to say about retaining control. It’s an option, even though an expensive one.

Private Equity 106

Private Equity Valuation Cap Table Accredited Investor 106

Berkonomics

MAY 7, 2015

If you attempt to create a manufacturing business where the total available market for your products is only $30 million, even success leading to a dominant share of the market would not allow your company to scale it to a size of great interest to investors. Email readers, continue here…] This lesson is important.

Liquidity Event 48

Liquidity Event .Net Differentiation Business Plan 48

Business Plan Blog

DECEMBER 9, 2013

Regardless of how solid the product or service is, if an entrepreneur does not consider the following fundamentals, they’ll find it difficult to attract Angel investment: - Type of industry. Angels realize their ROI during a liquidity event. Company’s stage of development and capital requirements. Geographic location.

Angel Investor 71

Angel Investor Exit Strategy Liquidity Event Seed Stage 71

Rob Go

JULY 17, 2014

As former operators and product-oriented entrepreneurs, Dave, Lee, and I tend to think of our firm as a startup company and our approach to investing as our product. It shows that things are working and there is product/market fit, but there is a long way to go towards building an enduring company of great consequence.

Seed Stage 69

Seed Stage Early Stage Due Diligence Liquidity Event 69