How To Raise Seed Money Right (And Wrong)

YoungUpstarts

I need to admit to a personal bias right up front: I am not the biggest fan of borrowing seed money. In fact, when I founded Fit Body Boot Camp , I never took a single of cent of seed money, mainly because I wanted to maintain total control of my vision. Also, I have invested and continue to invest in many upstarts myself, so I’m certainly not against other entrepreneurs seeking out seed money. DO Raise Seed Money Through Sales.

Don’t Forget Grants If You Need Early Seed Money

Startup Professionals Musings

In the US, many entrepreneurs see grants as “free money,” since they are not loans and don’t have to be repaid. If you meet all the requirements, complete all the paperwork, and submit your grant application today, it will likely be six to nine months before you see any money. Professional help costs money. Money has always been tight for high-tech entrepreneurs who need to raise capital from investors willing to gamble on a new idea.

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Sources of Seed Money

The Entrepreneurial Mind

Even thought money for entrepreneurial ventures is tougher to find than it was in the boom times, there still is money out there. Even seed stage ventures can find backing if they are patient, determined, and have a strong enough business model. Susan Schreter in an article at Business on Main identifies twenty seed stage funds from around the country. Business on Main sponsored post business on main seed funding susan schreter

Don’t Forget Grants If You Need Early Seed Money

Gust

In the US, many entrepreneurs see grants as “free money,” since they are not loans and don’t have to be repaid. If you meet all the requirements, complete all the paperwork, and submit your grant application today, it will likely be six to nine months before you see any money. Professional help costs money. Money has always been tight for high-tech entrepreneurs who need to raise capital from investors willing to gamble on a new idea.

5 Tips for Beginning Bitcoin Investors

The Startup Magazine

You’ve heard about that teenager or grandmother or your brother-in-law’s co-worker’s cousin who invested a little bit of money in bitcoin and struck it rich and you want part of the action. That is why setting realistic profit targets (and smart stop losses) is key to making money in bitcoin.

The Top 3 Financial Perks of Launching a Startup Company During College

The Startup Magazine

You should never ignore the opportunity for money off of the things you need to get set up. If money is your worry, then it’s time to be proactive. In return, you may be able to get your hands on some seed money for your college startup.

Ready, Set, Drive!: 8 Signs That Now Is the Time to Launch Your Trucking Business

The Startup Magazine

You Have Access to Seed Money. You’ll have to buy your own truck, purchase your own commercial insurance and may need money to tide you over as you seek your first clients. Have you always wanted to start your own trucking business?

A Quality Benchmark for Accelerators: The Global Accelerator Network

Feld Thoughts

Provide some sort of seed capital to their founders. Accelerators business david cohen entrepreneur global accelerator network Seed money TechStars United States Venture Capital When David Cohen and I came up with the idea for the Global Accelerator Network (GAN) in 2010, we counted roughly 100 accelerator programs around the US that were founded following the Techstars model.

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How much capital should you raise?

Version One Ventures

Many new founders think that because they’ve secured their seed round, it will be easy to find investors for the next round, and the next… However, a startup needs to demonstrate significant progress between funding rounds. Final thoughts Unless you’re able to bootstrap your startup until you reach profitability, you’ll need to raise money at some point in your company’s lifecycle. Take the money, but do it wisely. News funding Investor Seed money start-ups venture capital

How to deal with the Series A crunch

Version One Ventures

With headlines declaring that more than 1,000 seeded startups will soon be orphaned, it’s only natural that startups are concerned about the future funding landscape. Seed financing grew from 89 fundings in Q1 2009 to more than 500 in Q3 2012. That means there are a lot more seeded startups out there: an excess demand for a limited supply of Series A financings. Traditionally, I’ve advised startups to raise enough money to sustain them for 18 months.

4 Tips For Startups During A Pandemic

YoungUpstarts

Are you paying money for SaaS services that are no longer relevant or can be taken on by employees? Now is the time for laser focus: to concentrate all available assets on your money makers. Contributing seed money to an employee’s HSA or 401K, or instituting a match program for contributions, can encourage employees to save. by Juan Pablo Segura, President and Co-Founder of Babyscripts.

4 Best Websites To Apply For Accelerators And Incubators

YoungUpstarts

Accelerators are mainly focused on helping companies achieve business growth in a short period of time, typically a few months, hence the term “accelerator” They support young companies by providing mentorship and seed money. Started in 2004, it has helped over 500,000 startup founders to receive seed money and has raised over $1 billion in investment capital for them. by Melvin Wong , founder of Kodorra.

The Silliness Of Recapping Seed Rounds

Feld Thoughts

A company raises $1m of seed money from angels in a convertible note with a $6m cap. Assuming equity is raised at or above that cap, the total dilution, before the new money, is 16.6% (equivalent to an equity financing of $1m at a $6m post money valuation. ” They are running out of money. The term sheet converts all the convertible debt into a post-money valuation of $100, essentially making the convertible debt worthless.

Startup Accelerator Fail: Most Graduates Go Nowhere

ReadWriteStart

They offer seed money and mentoring in exchange for equity, normally about 7%. It takes years for companies to get traction and get an exit, so if you’re trying to optimize for making money now you’ll make some pretty terrible decisions. I would be very wary of any accelerator that thinks it will make money in the short term.”. Startup accelerators continue to grow in popularity.

How Investors Think About Valuation of Pre-Revenue Startups

SoCal CTO

They might have some seed money and are thinking or raising a Series A based on success of an early release (MVP). He just post: Establishing the Pre-money Valuation of Pre-revenue Startups. A lot of my time is spent helping early-stage companies get to proof points so that they can raise capital. Because of this, I've always tried to stay up-to-speed on how early-stage investors look at valuation of companies. What are they really looking for?

Doing The Right Thing In A Recap

Feld Thoughts

Six weeks ago I wrote a post titled The Silliness Of Recapping Seed Rounds. My answer was simple – I would have given the early seed investors some percentage of the company as part of the financing. Given the amount raised, the new financing, and the cap, I would have asked the seed investors to waive the terms and instead accept a smaller percentage of the company than they would have otherwise gotten. Investments fg angels recap seed

Startup Accelerator The Brandery Opens Applications For 2013

YoungUpstarts

The Brandery provides each company with $20,000 in seed money, training sessions with other entrepreneurs and industry experts, and networking with more than 60 mentors who work with startups to provide insights and help grow each idea into an investable, scalable product. They continue to have success building their teams and raising money.”

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5 Unusual Ways To Fund A Business Without Going Into Debt

YoungUpstarts

If you have a great idea for a new business but you need the money to make it happen, consider one of these unusual ways to fund your business without going into debt. Additionally, RocketHub will let you keep the money you raised, even if you didn’t meet your goal. Even though you likely want to start working full-time at your new business right away, you might need to either stay at your day job or work a side job to help raise money for your business.

Designing a Corporate Entrepreneurship Program – A Qualcomm Case Study (part 1 of 2)

Steve Blank

The bootcamp requested that participants do what entrepreneurs do before requesting seed funding – Discover, Network and Accelerate. (In Our employees faced the typical impediments to corporate entrepreneurship – lack of employee time, skills, connections, pre-seed money, and official sources to discuss and manage the risk/rewards tradeoffs of sticking your neck-out.

Designing a Corporate Entrepreneurship Program – A Qualcomm Case Study (part 1 of 2)

Steve Blank

The bootcamp requested that participants do what entrepreneurs do before requesting seed funding – Discover, Network and Accelerate. (In Our employees faced the typical impediments to corporate entrepreneurship – lack of employee time, skills, connections, pre-seed money, and official sources to discuss and manage the risk/rewards tradeoffs of sticking your neck-out.

The Corrosive Downside of Acquihires

Both Sides of the Table

Let’s assume $2 million in seed money. If the money comes from professional investors it usually has a “liquidation preference” meaning that their money comes out before the founders or common stock. (If They founded their last company with no money in their pocket. That way investors (dead money for the buyer) and founders (flight risk) don’t get all the spoils while the faithful staff who will stick around get nothing.

4 Best Websites to Apply for Acceleration and Incubation Programs

Kodorra

Accelerators are mainly focused on helping companies achieve business growth in a short period of time, typically a few months, hence the term “accelerator” They support young companies by providing mentorship and seed money. Started in 2004, it has helped over 500,000 startup founders to receive seed money and has raised over $1 billion in investment capital for them.

8 Guidelines For Friends And Family Startup Funding

Startup Professionals Musings

Since they don’t know you (yet), their first integrity check on you as a person is whether your friends and family believe in you strongly enough to give you seed money for your new idea. If you set around quietly waiting for someone you know to offer you money to fund a startup, you will probably have a long wait. On the other hand, if you open every conversation with “I need money,” you won’t have any friends or any money.

6 Tips To Tell Your Story Effectively

YoungUpstarts

Did the seed money really come from tips you made as a waiter, or did it have something to do with that gift your parents gave you? by Adam Witty, Founder and CEO of Advantage | ForbesBooks. Computing pioneer Alan Kay said, “Scratch the surface in a typical boardroom and we’re all just cavemen with briefcases, hungry for a wise person to tell us stories.”. Storytelling is the hot trend in business communications.

How the Seed-Stage VC Trend Began, The Downsides of Unicorns & Much More

Both Sides of the Table

*. If you are a 20-something tech entrepreneur you could be forgiven for thinking that seed-stage investors, Angellist Syndicates and widely available angel money always existed. I was out to raise my first seed money in my second startup of $500,000. Some quick highlights include: The Role of a Seed Stage VC. Jeff and his peer group have done an excellent job at creating a new category of seed-stage VC. Each VC raises money – say $90 million.

[Event] Global Entrepreneurship Week 2011 To Hit Record 123 Countries

YoungUpstarts

Movers & Changers Forum: Finalists in this mtvU/NYSE Euronext competition will ring the opening bell at the New York Stock Exchange on the opening day of GEW and compete for $25,000 in seed money to help start their companies. The entrepreneurship movement around the world is growing from strength to strength, and much of that momentum can be attributed to the annual Global Entrepreneurship Week.

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A Year in Review: 2016

Version One Ventures

At the same time, seed money is still abundant due to the proliferation of micro VC over the past few years. They started with a simple question: if 100 startups raise a Seed round, how many of those will go on to raise a Series A, and then a Series B ? The challenge here is that founders – having an easy time raising their seed rounds and maybe Series A – can be lulled into thinking that each subsequent round will be just as easy.

Fundraising pitches are not actually pitches.

Hippoland

But then one day, I pitched 2 seed partners at a VC firm. Although you do not need a deck to raise seed money, this is why I like to use a deck in my conversations with seed investors. It may not be a fair assessment of how you’ll lead a company, but with limited data points, this is what seed investors are paying attention to. The startup industry should stop using the word “pitch”.

8 Key Actions for Entrepreneurs Needing Early Money

Startup Professionals Musings

Since they don’t know you (yet), their first integrity check on you as a person is whether your friends and family believe in you strongly enough to give you seed money for your new idea. If you set around quietly waiting for someone you know to offer you money to fund a startup, you will probably have a long wait. On the other hand, if you open every conversation with “I need money,” you won’t have any friends or any money.

How to Decrease the Odds That Your Startup Fails

Both Sides of the Table

We also know that even though many of us who are experienced in startup successes & failures look at businesses and say, “That will never work” (as many people said about Uber) or “You can’t make any money in that business” (as many said about WhatsApp or Dropbox) and of course some entrepreneurs pull off extraordinary things we never thought possible. Many startup businesses – tech or otherwise – fail.

6 Ways To Make Your Startup More Attractive To Investors — Even With A Criminal History

YoungUpstarts

But he chose to move forward with a positive attitude, raise seed money for his company, and network his way to a profitable future. by Catherine Hoke, founder and CEO of Defy Ventures. If you knew entrepreneur Marquis Hayes 10 years ago, you would barely recognize him today.

Startup Business Investments Around The World

YoungUpstarts

They are investors who provide you with all the resources you need, including seed money, physical space for your startup, advice, and connection with other investors in their network. They aim to help small businesses take off the ground, and at the same time, make money from loan profits. by Rocky Chan, business consultant for Enterph.com. Startups caught the attention of venture capitalists as far back as three decades ago.

No Plan Survives First Contact With Customers – Business Plans versus Business Models

Steve Blank

We thought we’d take our plan and go raise seed money. We can’t raise money knowing our plan is wrong.”. This includes how the product gets distributed to your customers and how money flows back into your company. This team had wanted to have coffee to chat about which of the four seed round offers they had received they should accept. No campaign plan survives first contact with the enemy. Field Marshall Helmuth Graf von Moltke.

Build Entrepreneur Credentials Early and Wisely

Startup Professionals Musings

Too many startups fail simply by missing the practical elements of money management, time management, and setting priorities. Most schools have business plan competitions, and even give out seed money to winners. Many believe that entrepreneurs are born, not made. While I agree that successful company builders usually have a natural inclination to be entrepreneurs, a good education helps polish that apple.

Why You’re Not Getting the Most out of Your Board

Both Sides of the Table

If you’re a venture-backed tech company or even an early-stage business fueled by angel or seed money I assume you have a good group of board members or advisors who will give you time to be helpful and they want to be helpful. should we hire the head of a business unit who has turned out to be a bad seed? Most board meetings are “update meetings” where management downloads its status to a group of investors.

What’s the problem with too much funding?

Version One Ventures

With the influx of seed money, much has been written about the fact that start-ups that are taking far more funding than they need. If you do take on too much money early on, congratulations on the success- but be aware of the potential consequences and manage them proactively. For example, check out Fred Wilson’s post where he compares funding a start-up to walking up a flight of stairs.

3 Reasons To Seek Only What You Need During The Funding Process

YoungUpstarts

The startup scene is not short on fun ideas like Yo, but without the ability to justify the amount of money you are seeking and how it will be used to grow your company most investors are going to decline to open their wallets. Looking back to its origins you find it began with just $20,000 in seed money. By Paul Jackson, founder of Worthworm. For new or young entrepreneurs, understanding the realities of the startup world often comes as a shock.

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Seed and Later Investments for Startups are Booming

Startup Professionals Musings

The number of startups getting seed funding in 2012 jumped by 65% over the previous year to a total of 1749, according to a recent report by CB Insights. Seed investments” are early stage financings (typically less than $1.5 Thus the venture capital industry isn’t dead yet, despite all the rumors, and more startups are getting money, even at Series A and later levels. Seeded companies will take longer to raise a next round. The Internet sector is tops for seed deals.

So Just How Do You Start A Startup?

YoungUpstarts

They originally set out to make money selling programming languages. Only Money Can Make It Happen. Every startup needs money. There are a few ways to go about this, you can get loans, raise the money yourself, or get investors. Essentially you’ll need seed money, to begin with. The more money you need, the more this will be scrutinized by investors. Doing away with the average 9 to 5 and setting up shop yourself is becoming hugely popular.

5 Reasons To Use Your Personal Credit Card For Business Expenses

YoungUpstarts

Unless you have a healthy bank account or investors to fall back on you’re likely going to use your personal money to finance portions of your business expenses at some point. If you qualify for a low-interest personal credit card you will save money in the long run, especially if you pay the balance in full each and every month. This could come in very handy when you need seed money or need to make several large purchases at once.

Most Great Entrepreneurs Don’t Drop Out of Harvard

Startup Professionals Musings

Too many startups fail simply by missing the practical elements of money management, time management, and setting priorities. Most schools have business plan competitions, and even give out seed money to winners. Many believe that entrepreneurs are born, not made. While I agree that successful company builders usually have a natural inclination to be entrepreneurs, a good education helps polish that apple.

Series Seed or Convertible Note? Which one is more founder friendly? Which one do investors prefer?

Gust

Assuming the company is able to make effective use of the seed money to greatly increase the value of the enterprise, all of that value therefore accrues to the founder, rather than the investor. For example, let’s say the “real” value of a startup is $900,000, a seed investor puts in $100,000 on a Convertible Note with a 20% discount, and the company then raises a Series A round of $1 million at a $4 million ‘pre-money’ valuation.

Why I cringe when you say you’re raising a $1.5m seed round.

Hippoland

Company A: -Raised a seed round of $500k -Now raising another seed round of $2.5m to expand the business Company B: -Raised a seed round of $2m -Now raising another seed round of $1m to expand the business Should both companies successfully raise, they would’ve raised the same total amount of seed money - $3m. They raised a small seed round – perhaps to get them to some initial milestones, flesh out the idea, get some initial customers.

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