Startup Professionals Musings

SEPTEMBER 12, 2021

As a startup mentor and investor, I am approached regularly by aspiring entrepreneurs who assert that business plans take too much time, are inaccurate, and rarely add value. They can iterate and evolve their business idea with a low burn rate and minimal dependencies. You won’t even be considered without a business plan.

Business Plan 316

Business Plan Technical Review Angel Investor Due Diligence 316

Both Sides of the Table

APRIL 23, 2017

You have cash in the bank, a monthly burn rate and a “cash out” date that few in the company truly comprehend. But if you work your entrepreneur network, talk with lawyers who do a ton of startup deals, ask existing investors, etc. The best VCs follow up but then so, too, to the best entrepreneurs.

Burn Rate 238

Burn Rate Term Sheet CTO Hire Fractional CTO 238

Steve Blank

FEBRUARY 26, 2013

90 days later, I found out our games are terrible, no one is buying them, our best engineers started leaving, and with 120 people and a huge burn rate, we’re running out of money and about to crash. Now when I listen to entrepreneurs who’ve cratered a company, I listen for their stories of failure and redemption.

Redemption 333

Redemption Cofounder Silicon Valley Burn Rate 333

Startup Professionals Musings

NOVEMBER 7, 2014

As a startup mentor and investor, I am approached regularly by aspiring entrepreneurs who assert that business plans are a waste of time. They cite sources like the BusinessWeek story, “ Real Entrepreneurs Don’t Write Business Plans ” and this Forbes article. You’ve built a successful startup before, and plan to use the same investors.

Business Plan 274

Business Plan Technical Review Angel Investor Due Diligence 274

Startup Professionals Musings

JULY 9, 2014

If you think you are the perfect fit for the entrepreneur lifestyle, but you’re not yet sure if you’re ready to start your own, then I recommend that you take a job with an existing startup first to validate the culture realities against your dream. Hang out where entrepreneurs meet. What is the startup cash burn rate per month?

Technical Review 250

Technical Review Stock Options Silicon Valley Due Diligence 250

The Next Web

JANUARY 22, 2014

This would indicate that founders are generally being sensible with their bank balance, watching their burn rate closely and not taking more out until there’s more coming in. After age 50 it dips, indicating that perhaps middle-aged entrepreneurs have often already made enough money in their lives to be comfortable.

Salary 152

Salary Founder Entrepreneur Burn Rate 152

Startup Professionals Musings

JULY 15, 2013

Many entrepreneurs actually refuse to do financial projections beyond the first year, insisting that no one can predict the future. Your “burn rate” or net cash flow out is usually the single most important survival parameter to a startup. financial forecast entrepreneur startup pricing business' Cash flow is king.

Forecast 238

Forecast Business Plan Burn Rate .Net 238

Startup Professionals Musings

JUNE 9, 2012

Many entrepreneurs actually refuse to do financial projections beyond the first year, insisting that no one can predict the future. Your “burn rate” or net cash flow out is usually the single most important survival parameter to a startup. If you are not willing to commit, don’t expect anyone to back you. Cash flow is king.

Forecast 238

Forecast Burn Rate .Net Business Model 238

Startup Professionals Musings

MARCH 22, 2011

Many entrepreneurs actually refuse to do financial projections beyond the first year, insisting that no one can predict the future. Your “burn rate” or net cash flow out is usually the single most important survival parameter to a startup. If you are not willing to commit, don’t expect anyone to back you. Cash flow is king.

Forecast 230

Forecast Burn Rate Startup .Net 230

Both Sides of the Table

JUNE 19, 2017

One of the hardest decisions entrepreneurs make when they start a company and raise outside capital is figuring out what an acceptable “burn rate” is. The main reason to know your burn is to arrive at a quick calculation of how many months cash you have before you run out of cash.

Burn Rate 212

Burn Rate Startup .Net Venture Capital 212

Both Sides of the Table

FEBRUARY 8, 2016

The startup industry may be “resetting,” which doesn’t mean a “crash” but rather just a resetting of valuations, timescales, winners/losers, capital sources and the relative emphasis of growth rates vs. burn rates. We entrepreneurs have been spinning that line for decades in every boom cycle.

Burn Rate 150

Burn Rate Cap Table Startup Dilution 150

Steve Blank

FEBRUARY 26, 2013

90 days later, I found out our games are terrible, no one is buying them, our best engineers started leaving, and with 120 people and a huge burn rate, we’re running out of money and about to crash. Now when I listen to entrepreneurs who’ve cratered a company, I listen for their stories of failure and redemption.

Redemption 225

Redemption Cofounder Silicon Valley Burn Rate 225

Startup Professionals Musings

OCTOBER 18, 2015

If you think you are the perfect fit for the entrepreneur lifestyle, but you’re not yet sure if you’re ready to start your own, then I recommend that you take a job with an existing startup first to validate the culture realities against your dream. Hang out where entrepreneurs meet. What is the startup cash burn rate per month?

Technical Review 120

Technical Review Entrepreneur Stock Options Silicon Valley 120

Both Sides of the Table

OCTOBER 12, 2010

If you can’t figure all of this out then adding a non-founder sales person isn’t going to solve your problems – it’s just going to add to your burn rate. I find myself often saying to these entrepreneurs, “having watched you I can see why customers are interested in buying.

Hiring 346

Hiring Sales Startup Early Stage 346

Feld Thoughts

NOVEMBER 18, 2013

Ari Newman is an entrepreneur, mentor, investor, and a friend. He works at Techstars where his responsibility is to ensure that the connections between alumni, mentors, and staff are as robust as they can be – helping entrepreneurs “ do more faster ” day in and day out. The plan would have to get way tighter, way faster.

Burn Rate 157

Burn Rate Equity Software Review Early Stage 157

Both Sides of the Table

AUGUST 9, 2011

I thought about things I never had to as an entrepreneur: check size, ownership percentage, deal stage, portfolio construction and risk. Companies raised too much money in 2005-08 and had high burn rates. So I encouraged entrepreneurs to think about raising their funds as quickly as they could because. tl;dr summary.

Stock 305

Stock Technical Review Marketing Greece 305

The Next Web

DECEMBER 2, 2013

Luck, timing and social engineering are bigger components than most entrepreneurs care to imagine,” adds Werdelin. Considering Facebook’s scale, the company is now in the business of operating power plants to operate its servers, therefore, Schippers estimates that Facebook has a $30 million dollar monthly burn rate just for hosting.

Cost 168

Cost San Francisco New York City Ruby 168

ReadWriteStart

APRIL 26, 2011

MicroVentures does the due diligence for investors, running a variety of checks on financials, forecasts, use of funds, burn rate and so on. MicroVentures says it makes the process of fundraising easier for entrepreneurs too.

Software Review 122

Software Review Accredited Investor Due Diligence Burn Rate 122

Startup Professionals Musings

MARCH 25, 2010

Many entrepreneurs actually refuse to do financial projections beyond the first year, insisting that no one can predict the future. Your “burn rate” or net cash flow out is usually the single most important survival parameter to a startup. Then there are computer costs, trade shows, inventory, and a thousand other things.

Forecast 151

Forecast Startup Burn Rate .Net 151

VC Cafe

NOVEMBER 2, 2019

One question that keeps coming up when speaking with early stage entrepreneurs when it comes to funding, is what metrics the company needs to hit to raise seed/series A/B etc: What’s a good conversion rate? Is my churn rate below the category average? What should our MRR growth be? Software as a Service (Saas) benchmarks.

B2C 141

B2C Technical Review Startup Retention 141

Startup Professionals Musings

FEBRUARY 17, 2021

With the appearance of do-it-yourself services on the Internet, entrepreneur curriculums at every university, and a wealth of new books on the subject, the need for expensive consultants and business advisors has also been mitigated. These steps alone can reduce your monthly burn rate by at least $10K.

Cost 405

Cost Entrepreneur Burn Rate Social Media 405

crowdSPRING Blog

OCTOBER 24, 2014

What is the Right Burn Rate at a Startup Company? | All young entrepreneurs should read … My Last Day At PivotDesk | Kelly Taylor’s Blog – crowdspring.co/1sZar6P. Why You Should Find Product-Market Fit Before Sniffing Around For Venture Money | Co.Labs – crowdspring.co/1sRVsv5. Candid & raw.

Social Media 95

Social Media Small Business Design Media 95

Startup Professionals Musings

APRIL 10, 2016

From my perspective as an investor, I recommend that every founder needs to know the answers to these questions, be open and honest in answering them thoughtfully, and without making excuses: What is the current runway and burn rate?

Sweat Equity 120

Sweat Equity Burn Rate Technical Review Intellectual Property 120

Feld Thoughts

OCTOBER 5, 2022

Andy Dunn , who I only know indirectly, wrote an important book titled Burn Rate: Launching a Startup and Losing My Mind. While there might be other entrepreneur autobiographies like Burn Rate , I can’t think of any. Andy’s book is his entrepreneurial story combined with his experience of being bipolar.

Burn Rate 157

Burn Rate Startup New York Restful 157

YoungUpstarts

JUNE 20, 2019

Entrepreneurs have a strong sense of self-reliance, and so the idea of asking for help isn’t on their radar. While additional personnel is crucial to scale the product, misaligned hires will increase burn rate without a concurrent jump in productivity and meaningful growth. Avoiding churn is also key in monitoring burn rate.

Technical Cofounder 113

Technical Cofounder Burn Rate Seed Stage Cofounder 113

crowdSPRING Blog

OCTOBER 10, 2014

Why entrepreneurs should learn to say “I don’t know” more often – crowdspring.co/1pGXXeF. Refocusing the Startup Burn Rate Debate | OpenView Blog – crowdspring.co/1n8paLq. Passion Alone is Not Enough to Open a Business – crowdspring.co/YVlAZA. ” – crowdspring.co/1slKVZ2.

Social Media 97

Social Media Small Business Design Media 97

techcrunch.com

FEBRUARY 26, 2013

Personally, I think leading VC firms do a pretty good job of being supportive of their companies, and most entrepreneurs funded by good funds like their investors. In my view, many if not most of them haven’t done enough in their careers to earn the right to advise entrepreneurs, a job I consider laden with responsibility.

Burn Rate 87

Burn Rate Hiring Engineer Entrepreneur 87

crowdSPRING Blog

DECEMBER 12, 2014

7 Things Successful Entrepreneurs Do – crowdspring.co/1pIQxNE. Lessons From Burning Man on How to Unlock Creativity and Think Big – crowdspring.co/12h0PKB. Don’t Get Burned by Your Burn Rate – crowdspring.co/159KKrk. 14-Year-Old Entrepreneur on Meeting President Obama | Fox Small Business – crowdspring.co/1reRybq.

Social Media 100

Social Media Small Business Design Media 100

Startup Professionals Musings

DECEMBER 31, 2013

If an entrepreneur doesn’t find themselves in over their head at least 20% of the time, they are probably not pushing the limits, not taking enough risk, and probably not working on an idea that’s worth doing. Unfortunately, too many entrepreneurs I know are terrible at finding and accepting help.

Burn Rate 275

Burn Rate Entrepreneur Differentiation Salary 275

Genuine VC

FEBRUARY 9, 2011

And there are many reasons why a not-as-blue-chip investor would be in a company with real promise: prior relationships he has with the entrepreneur, specific domain expertise/understanding of a sector, capital requirements for the business, or other dynamics around the round (price, hustle).

Startup 146

Startup Burn Rate Technical Review Down Round 146

This is going to be BIG.

MARCH 1, 2010

What gets frustrating is that I tend to hear the same arguments over and over again from new entrepreneurs, and many of them are just completely unfunded. Unfortunately, they tend to resonate really well with frustrated entrepreneurs and a lot of dust gets kicked up over them. You know what—it’s supposed to work like that!

New York City 114

New York City New York Startup Burn Rate 114

Startup Professionals Musings

SEPTEMBER 21, 2019

If an entrepreneur doesn’t find themselves in over their head at least 20% of the time, they are probably not pushing the limits, not taking enough risk, and probably not working on an idea that’s worth doing. Unfortunately, too many entrepreneurs I know are terrible at finding and accepting help.

Burn Rate 249

Burn Rate Entrepreneur Differentiation Salary 249

Startup Professionals Musings

SEPTEMBER 30, 2019

Serious entrepreneurs know that, but too many “wannabes” still fall for that elusive get-rich-quick scheme with no risk. As an active angel investor, I still hear entrepreneurs asserting large opportunities with minimal risk and no competition. When entrepreneurs become prisoners of hope, they look for others to solve their problem.

Entrepreneur 267

Entrepreneur Burn Rate Angel Investor Operations 267

Startup Professionals Musings

DECEMBER 15, 2014

Eighty percent of new entrepreneurs use this approach, with only six percent using investor funding. The remaining entrepreneurs borrow from family and friends, or acquire a loan. Count on several months of effort and costly assistance to court investors, with less than a 10% success rate.

Bootstrapping 276

Bootstrapping Entrepreneur Startup Burn Rate 276

Both Sides of the Table

SEPTEMBER 28, 2014

I was reading Danielle Morrill’s blog post today on whether one’s “ Startup Burn Rate is Normal. Danielle goes through some commentary from Bill Gurley, Fred Wilson and Marc Andreessen about burn rate and then goes on to discuss her own burn rate and others publicly weigh in.

Burn Rate 383

Burn Rate Balance Sheet .Net Valuation 383

Startup Professionals Musings

JUNE 27, 2022

If an entrepreneur doesn’t find themselves in over their head at least 20% of the time, they are probably not pushing the limits, not taking enough risk, and probably not working on an idea that’s worth doing. Unfortunately, too many entrepreneurs I know are terrible at finding and accepting help.

Burn Rate 329

Burn Rate Differentiation Salary Entrepreneur 329

Both Sides of the Table

JULY 16, 2013

The company with no revenue and a $150k burn rate that raised $2.5 I know it’s not as sexy as a faster growth rate and a larger round of capital. In this situation I think we should be increasing burn rate and not immediately focusing on revenue [I do sometimes believe this]. You’re out of money.

Burn Rate 412

Burn Rate Dilution Revenue Valuation 412