Both Sides of the Table

JULY 29, 2010

The A round was done in February 2000 (end of the bull market) and my B round was done in April 2001 (bear market). People buy companies for 3 primary reasons: 1) they want the management team / talent 2) they want the technology or 3) they want the market traction (revenue, customer base, profits, etc). Check ‘em out!

Venture Capital 282

Venture Capital Term Sheet Valuation Stock Options 282

Both Sides of the Table

SEPTEMBER 29, 2009

Just ask anybody who was trying to close funding the fateful week of September 11, 2001 or even March 2000. Huge downturns have a real impact on the revenue line of start-ups and therefore the pressure on valuations. But any entrepreneurs raising capital should keep in mind that this opening of the markets could possibly be temporary.

Burn Rate 263

Burn Rate Valuation Pre-Money Valuation Private Equity 263

Both Sides of the Table

SEPTEMBER 18, 2014

At an accelerator … Me: Raising convertible notes as a seed round is one of the biggest disservices our industry has done to entrepreneurs since 2001-2003 when there were “full ratchets” and “multiple liquidation preferences” – the most hostile terms anybody found in term sheets 10 years ago. Your A round?

Venture Capital 417

Venture Capital Liquidation Preference Valuation Term Sheet 417

Steve Blank

SEPTEMBER 14, 2009

Five Quarters of Profitability During the 1980’s and through the mid 1990’s startups going public had to do something that most companies today never heard of – they had to show a track record of increasing revenue and consistent profitability. There was now a public market for companies with no revenue, no profit and big claims.

Silicon Valley 236

Silicon Valley IPO Technical Review Venture Capital 236

Babbling VC

AUGUST 10, 2011

OK, hands up, who's truly surprised by the drop in the stock markets or the postponed tech IPO's or even the upcoming slowdown in venture financing? I am seriously babbling like everyone else did in 2001, 2008 and now again in 2011. Make your customers happy, especially the ones generating the majority of your revenues.

Germany 76

Germany Stock IPO Valuation 76

Scalable Startup

AUGUST 26, 2014

Drupal was launched in 2001, and Acquia started in 2007. Red Hat was one of the first of these types of companies bridging open source with big finance, leveraging Linux support into a profitable business, also leveraging the enterprise. Acquia, Inc. Because they are open source. They kind of invented this business model.

Founder 42

Founder Los Angeles PHP Open Source 42

K9 Ventures

SEPTEMBER 8, 2015

Direct Revenue, meaning no three-way business models and no advertising, media, or content. In late 2000, early 2001 I started my second company to test whether I can build a successful company again. MK : Initial investments are typically around $400,000 to $500,000, typically part of a Pre-Seed round of financing.

San Francisco 48

San Francisco Early Stage Portfolio Software Engineering 48

Ben's Blog

MARCH 24, 2011

Similarly, in recent high profile private financing rounds for private technology companies with valuations over $1B, the valuation multiples were at or below corresponding multiples for publicly traded companies such as Google. And hence the great crash of 2000 and 2001. Public market comparables. Much better.

Technical Review 78

Technical Review Valuation Venture Capital Database 78

Startup Lessons Learned

JUNE 22, 2020

The Economic Antidote to COVID-19 Eric Ries & Ryan Beck In 2001, Apple's revenue fell by 33% in the depths of the dotcom bust. As revenue contracts, orders slow, and capital markets freeze, conventional wisdom drives business leaders to cut costs and shy away from new projects. The rest is history.

Silicon Valley 60

Silicon Valley Equity Stock Finance 60

Mike Michalowicz

OCTOBER 19, 2015

An accounting firm based in Santa Monica, CA, specializing in bankruptcy, from 2001 to 2003. Previously, from 1999 to 2001, Seth was a Senior Revenue Accountant for the Veterinary Centers Of America. An accounting firm based in Santa Monica, CA, specializing in bankruptcy, from 2001 to 2003.

Video 60

Video SEC Bankruptcy Wisconsin 60

Ben's Blog

JUNE 18, 2011

If we are in a bubble, that is a bit of an odd commentary for a company that grew revenues 83% year-over-year and grew earnings 93% year-over-year. In 2001, Stewart Butterfield abandoned plans to build a massively multiplayer online game (MMOG) after costs became too great; he built photo-sharing service Flickr instead.

Technical Review 60

Technical Review Software Review Valuation Internet 60

Feld Thoughts

AUGUST 5, 2011

Today is Finance Friday and post #2 has been drafted by the Finance Friday team from University of Chicago Booth and is waiting for my edits. In 1999, 2000, and 2001 I had a my.yahoo.com page up with a bunch of stocks, including a number of companies I was an investor in, as my home page.

Stock 155

Stock Entrepreneur Chicago Finance 155

Eric Friedman

AUGUST 18, 2021

[They talk about] businesses which are not contractually recurring revenue in the parlance of recurring revenue run rates. They conflate flow businesses or they conflate usage-based businesses with contractual, recurring revenue businesses, and so on. We do that primarily through leading financings. That scares me.

Silicon Valley 88

Silicon Valley Venture Capital Cofounder Africa 88

Startup Lessons Learned

JULY 11, 2019

The first time was just for a couple years, from 2001-2003, before I went to grad school. That meant that if the change was starting on the founders side, then there had to be a change on the financing side. Ann will be speaking at this year’s Lean Startup Conference in October about all of this and more.

Founder 68

Founder Lean Venture Capital Cofounder 68

Feld Thoughts

OCTOBER 30, 2014

He had just read my post on being uncomfortable with the phase of the current cycle and told me an anecdote from the great Internet bubble of 2001 that I hadn’t heard. He’d gotten a random note asking about his valuation when we invested relative to another financing that was just announced.

Valuation 143

Valuation Stock Angel Investor IPO 143

Mike Michalowicz

SEPTEMBER 28, 2015

She began her career as a Wall Street executive, and earned an MBA in Finance from NYU-Stern School of Business. She started her first business, a handmade jewelry company, in 2001, where she learned that an MBA doesn’t even begin to prepare you for life as an entrepreneur. 80% of your revenue or profit comes from 20% of your clients.

Cofounder 60

Cofounder Framework Programming Small Business 60

Gust

SEPTEMBER 17, 2014

Me: Raising convertible notes as a seed round is one of the biggest disservices our industry has done to entrepreneurs since 2001-2003 when there were “full ratchets” and “multiple liquidation preferences” – the most hostile terms anybody found in term sheets 10 years ago. It’s like we need a finance 101 course for entrepreneurs.

Liquidation Preference 153

Liquidation Preference Valuation Term Sheet Stock 153

Both Sides of the Table

MARCH 11, 2010

But there are also problems / risks: - the funding environment might change dramatically – there may never be a next round (see: March 2000, September 11, 2001 and September 2008). - Let’s assume that the $2 million buys 25% of your company, which is the norm in an equity financing. .&# If it works you’re a hero.

Venture Capital 319

Venture Capital Startup Silicon Valley Warrant 319

Both Sides of the Table

SEPTEMBER 27, 2010

What micro VCs need to consider is what happens when several of your companies want to grow and require VC financing? Or when the economy turns downward and they all need financing extensions? They raised at $40 million pre-money for pre-revenue companies and when the economy corrected it became hard for them to refinance themselves.

Silicon Valley 308

Silicon Valley Liquidity Event Seed Stage Finance 308

BeyondVC

AUGUST 9, 2006

Ultimately what will give you the best chance for success is focusing on the things that you can control – building a real business with a real economic model that can generate cash from internal operations vs. through external financing. As he discusses in his blog post: Why I decided to pull our IPO filing.

Technical Review 60

Technical Review IPO SEC Stock 60

K9 Ventures

SEPTEMBER 24, 2009

This meant that I had to either show enough revenue, or find investors who would be willing to put money into the company. This also eliminated the big risk for my potential investors that I wouldn’t be able to stay in the country, and so I was able to close the financing round for the company in November 1998.

United States 114

United States Founder India Venture Capital 114

Ben's Blog

JULY 16, 2013

Perhaps you are caught in the “Series A crunch” or perhaps you are a consumer company and expected that you would be valued on users rather than revenue like the last time. 3/30/2001: 26.3. Financing capital market down round fundraising outkast' But they most certainly are not. How could this be? Aren’t markets rational?

Down Round 73

Down Round Marketing Preferred Stock Post-Money Valuation 73

Software By Rob

SEPTEMBER 1, 2011

In October of 2001, Webster, McCarthy, and Graff decided to do just that and GoldStar was born. By generating a steady revenue from consulting projects and sales, the founders were able to spend time growing their business slowly. Today, Litmus has had over 30,000 customers, 1 million+ in revenue, and is growing by around 10% a month.

Bootstrapping 78

Bootstrapping Startup Cofounder Salary 78

abovethecrowd.com

FEBRUARY 27, 2019

Founded by Michael Bruno in Paris in 2001, 1stdibs (*) is the world’s largest online marketplace for luxury one-of-a-kind antiques, high-end modern furniture, vintage fashion, jewelry, and fine art. In November of this year, the company announced that it had achieved “substantially” more than $1B in revenue in the third quarter.

Internet 88

Internet Matching Vertical Hosting 88

Ben's Blog

JULY 16, 2013

Perhaps you are caught in the “Series A crunch” or perhaps you are a consumer company and expected that you would be valued on users rather than revenue like the last time. 3/30/2001: 26.3 But they most certainly are not. Or maybe you are a lucky enterprise company and are pleasantly surprised—this time. How could this be?

Marketing 36

Marketing Preferred Stock Post-Money Valuation Down Round 36

Hearpreneur

AUGUST 19, 2015

In 2001, I came home to find my apartment on fire. I never want renters to find themselves in my situation – scared, displaced and worried about my finances. Many online jewellery stores are bricks-and-mortar stores supplementing revenues that don’t aligning to the tech-savvy consumer who want responsive technologies.

Entrepreneur 48

Entrepreneur Australia Technical Review Community 48

ConversionXL

DECEMBER 9, 2013

See, Mailchimp had already been around since 2001 and it took them from 7 years to reach their first 10,000 customers. It includes the services, warranties, packaging, advertising, financing, pleasantries, images, and other features that accompany the product. million customers total) in 2012. It never has been.

Sales 126

Sales B2B Campaign Video 126

Campus Entrepreneurship

DECEMBER 23, 2010

When I attended between 1998-2001, there were a few course on entrepreneurship (entrepreneurial finance, entrepreneurial strategy, etc.), Their success is unparalleled, said Steven Kaplan, Neubauer Family Professor of Entrepreneurship and Finance. but I don’t recall courses on internet strategy.

Cofounder 61

Cofounder Chicago Founder IPO 61

Both Sides of the Table

MAY 7, 2011

As an example, Joel says that there is a chief revenue officer who is solely responsible for bringing in revenue to StackExchange. He is responsible for bringing in revenue from advertising and their careers offering. There’s a big business in Finance working with Excel, but that’s an outlier. 29:45 minutes.

Software Review 285

Software Review Software St. Louis API 285

Ben's Blog

MAY 24, 2021

There are a number of trends concerning IPOs and capital formation to note: First, the raw number of IPOs has declined significantly: From 1980-2000, the US averaged roughly 300 IPOs per year; from 2001-2016, the average fell to 108 per year. 44% 2001-2019 13.7% First, as the below chart shows, IPO pops are not a new phenomenon.

SEC 36

SEC Accredited Investor IPO Technical Review 36

YoungUpstarts

APRIL 19, 2013

by Dean Zerbe, alliantgroup National Managing Director, and former Senior Counsel to the Senate Finance Committee. Those federal programs would be made whole by transfers from general revenues. Senate Committee on Finance. When it comes to U.S. Good News for Startups. Dean is a regular contributor to Forbes.com (Dean of Tax).

Small Business 145

Small Business United States Washington Startup 145