Startup Professionals Musings

SEPTEMBER 14, 2016

Cash flow is a basic survival metric for every startup. Deferred payments start with stretching the payables period but, more importantly, include giving employee equity in lieu of a higher salaries and negotiating vendor deferred payments out of future revenues. Desperate entrepreneurs lose their leverage and die young.

Burn Rate 120

Burn Rate Hockey Stick Startup Salary 120

Startup Professionals Musings

MAY 4, 2016

Who would not want to joint the unicorns (recent startups with a current valuation of over $1 billion)? Before you bring on partners, develop intellectual property, raise capital, or generate revenues, you need to establish an official business entity. Establishing your brand with interactive social media.

Intellectual Property 120

Intellectual Property Startup Angel Groups Social Media 120

YoungUpstarts

NOVEMBER 20, 2019

On the other hand, if you arrive at a VC pitch without a comprehensive understanding of the industry you’re hoping to compete in, or without a clear path to profitability or a thoughtful product-development road map, you’ll likely leave empty-handed. You may be able to generate revenue, but VCs want exponential growth.

Technical Review 140

Technical Review Due Diligence Early Stage Differentiation 140

Startup Lessons Learned

SEPTEMBER 22, 2008

Master of 500 Hats: Startup Metrics for Pirates (SeedCamp 2008, London) This presentation should be required reading for anyone creating a startup with an online service component. He also has a discussion of how your choice of business model determines which of these metric areas you want to focus on.

San Francisco 167

San Francisco CPA SEM CTO Hire 167

Occam's Razor

APRIL 23, 2012

While there is a great deal of appreciation for the power of metrics/data, I've come to realize that Sr. Leaders don't quite appreciate the deep, and often corrosive, consequences of choosing metric x over metric y as a key performance indicator (KPI). It is a standard metric. Revenue vs. Economic Value.

Metrics 152

Metrics Analytics Search Channel 152

Steve Blank

NOVEMBER 5, 2009

This post describes how companies using the Customer Development model can increase their credibility, valuation and probability of getting a first round of funding by presenting their results in a “Lesson Learned&# venture pitch. Is there a profitable business model? Can it scale?” Did the VC’s like your team ?

Customer Development 262

Customer Development Developer Customer Silicon Valley 262

View from Seed

OCTOBER 15, 2014

Examples of housekeeping include the following list, though not every item will appear every time: Finance: Cash out date, burn rate, 409A valuation, cap table, common/preferred stock dashboard. A seed-stage mobile startup’s housekeeping section might look something like this: Section 3: Core Metrics.

Seed Stage 331

Seed Stage Cap Table Metrics Burn Rate 331

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

betashop.com

OCTOBER 8, 2012

I firmly believe that in this age where the product development life-cycle is so short and user feedback comes so quickly, you will know within a year whether you are focusing on a worthwhile one thing. Never, ever, choose your investors based on valuation. 10M post-money valuation = $100M target. Jason is a product guy.

Technical Review 108

Technical Review Technology Software Review Valuation 108

The Equity Kicker

JANUARY 10, 2020

Maybe they’ll pivot to something great eventually, but in the interim period, the valuation goes sideways – and that’s not a good place for a VC to be. They find a niche in the market where they can grow some revenues and then they raise some more money. And what are the metrics for customer love? What are your benchmarks?

Partner 68

Partner Early Stage Portfolio Metrics 68

K9 Ventures

OCTOBER 10, 2017

If the Micro-VCs are looking for Series A-like metrics, what does a company do when it’s just getting started? If it doesn’t have the product fully baked yet? And people are expensive (especially in the Bay Area), so some Pre-Seed financing goes towards recruiting the right minimal set of people who can help to build the product.

Seed Stage 82

Seed Stage Finance Later Stage Equity 82

Software By Rob

APRIL 2, 2014

With SaaS businesses the majority of revenue will be through monthly, quarterly or annual billing recurring payment plans. This is a common issue and the best mitigation strategy is to source an affordable, reliable, independent third party to work on the product for 3-6 months before the sale. Choose your payment processor carefully.

Affiliate 67

Affiliate Valuation Reputation Sales 67

Software By Rob

APRIL 2, 2014

With SaaS businesses the majority of revenue will be through monthly, quarterly or annual billing recurring payment plans. This is a common issue and the best mitigation strategy is to source an affordable, reliable, independent third party to work on the product for 3-6 months before the sale. Choose your payment processor carefully.

Affiliate 27

Affiliate Valuation Reputation Sales 27

Seeing Both Sides

JANUARY 13, 2015

My boss and mentor from Open Market, Gary Eichhorn , made the entire management team read it in the 1990s to hammer home its important lessons as we stumbled through the chasm on our way to scaling from zero to nearly $100 million in revenue in a few years. At each stage, there are different problems. Anyone up for a rewrite? 10-50 million.

Mezzanine 20

Mezzanine IPO Finance Business Model 20