VC Cafe

FEBRUARY 26, 2023

“unique business models” – Successful startups develop business models that are difficult for competitors to replicate. To implement this trait, founders need to identify a unique value proposition and create a business model that is scalable and sustainable.

Founder 89

Founder Cofounder Seed Stage Valuation 89

The Startup Magazine

MARCH 14, 2022

It is here that the groundwork is laid and the business model developed. A business plan is drawn up to attract investors and partners. The legalities of starting the business are addressed to create a structure for attracting funding. The journey commences by finding a solution for an everyday problem.

Technical Review 144

Technical Review Due Diligence India Startup 144

VC Cafe

AUGUST 4, 2022

The VC markets have contracted almost overnight and last round’s valuations may no longer hold. You can’t change the market, but you can change how you respond to it – is it time to test a change in business model? This is an incredibly tough time to a lot of founders. Focus on what you can change.

Founder 159

Founder Aggregator Startup Valuation 159

VC Cafe

OCTOBER 31, 2022

Mature startups with proven business models and the potential to reach the public markets within a few years will be the safest place to park any new venture capital that comes into the ecosystem. Tiger, Softbank and other crossover funds are slowing down significantly and valuations overall are down significantly.

Founder 174

Founder Technical Review Down Round Liquidation Preference 174

The Startup Magazine

MAY 27, 2020

Although developments are slow and should continue to be that way thanks to the current global health issues, regulators around the world are expected to show an increasing interest in cryptocurrencies and regulatory actions are already having an impact on crypto valuations.

Technical Review 124

Technical Review Offshore Sweden China 124

Steve Blank

APRIL 1, 2020

Others are cutting their valuations. Remember, a year from now no one wants to be the CEO of a company out of business whose lament is, “I did what the board told me to do.”. This plan has three parts: Pivots to your new business model, changes to your operating plan, and what initiatives you save for the recovery.

South Korea 334

South Korea Salary Business Model China 334

ReadWriteStart

JUNE 1, 2020

In very few specific cases, depending on the nature of the business, the business model might demand a considerable gestation period or extensive research and development. For these businesses, it is imperative to get funding from the start without which the company cannot be set up. Bridge or exit stage.

Startup 150

Startup Entrepreneur Elevator Pitch Seed Stage 150

VC Cafe

OCTOBER 31, 2024

Non-consensus investments , on the other hand, are those that defy popular opinion or seem risky due to unconventional business models, unproven markets, or early market entry. When too many investors pile into ‘obvious’ opportunities, valuations inflate and returns compress.

Technical Review 78

Technical Review Due Diligence ChatGPT Generative AI 78

Startup Professionals Musings

SEPTEMBER 8, 2019

Some nonprofit entrepreneurs think they can skip the whole plan, rather than just the sections on valuation, equity offered, and exit strategy.

Equity 235

Equity Angel Investor Technical Review Exit Strategy 235

Steve Blank

OCTOBER 24, 2017

— all great things when you are executing and scaling a known business model. Because the new CEO had built a team capable of and comfortable with executing an existing business model, the company would fail or get acquired. Board Control. For three decades (1978-2008), investors controlled the board. The founders.

Founder 278

Founder Technical Review CTO Hire IPO 278

A Smart Bear: Startups and Marketing for Geeks

MARCH 21, 2017

It was said that Facebook drastically overpaid (a billion dollars for a company with fanatical users but zero revenue) but also that that Instagram was stupid to sell so early (because after more “inevitable” growth it would be worth much more, and would “inevitably” be bought or go public at that larger valuation).

Balance Sheet 242

Balance Sheet Vertical Acquisition Revenue 242

Steve Blank

MARCH 17, 2020

But next the question is, ‘What happens to my business?”. The questions every startup or small business CEO needs to ask now are: What’s my Burn Rate and Runway? What does your new business model look like? What does my business model look like now? Is this a three-month, one-year or a three-year problem?

Burn Rate 436

Burn Rate Startup Valuation Sales Cycle 436

Tim Keane

JANUARY 12, 2010

Term-sheets and Valuations: Thinking about Negotiations.   I’ve sat down with entrepreneurs and a copy of a term sheet guide I like [ “Term Sheets & Valuations - A Line by Line Look at the Intricacies of Venture Capital Term Sheets & Valuations ” by Alex Wilmerding, Aspatore Press.] The Valuation Question.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Steve Blank

MARCH 12, 2014

The startups and the teaching team crafted a challenge for the kids to tackle using the Customer Development methodology, Lean Launchpad tools and the business model canvas. These two startups had problems they could not solve on their own due to lack of resources—time, people, money.

Lean 335

Lean Customer Development Startup Silicon Valley 335

Startup Professionals Musings

JANUARY 10, 2016

Perhaps the most famous bubble for startups was the dot.com craze that crashed 15 years ago, where the highest valuations were given to companies with massive user growth, but minimal revenue or profit. Never take your eye off the ball in business. Or ask PlanetRx, an online service for prescriptions, before the Internet was pervasive.

Business Model 120

Business Model Intellectual Property Startup Bankruptcy 120

Startup Professionals Musings

OCTOBER 17, 2022

Super angels sometimes drive up valuations. Perhaps because of their focus on building a large portfolio, or their competitiveness, these angels sometimes accept valuations that cause later friction while moving to VCs, or even other angel groups. Marty Zwilling.

Angel Investor 342

Angel Investor Silicon Valley Venture Capital Portfolio 342

Steve Blank

MARCH 31, 2014

Look at the valuations of companies like Tesla, Illumina, and Twitter. The first will be commodity businesses that are valued for their ability to execute their current business model. The second class will be firms with a demonstrated ability to continually innovate and reinvent their business models.

Private Equity 330

Private Equity Metrics China Intellectual Property 330

SoCal CTO

FEBRUARY 2, 2011

Because of this, I've always tried to stay up-to-speed on how early-stage investors look at valuation of companies. Think about how you can prove your business model with an MVP. Bill Payne is an expert on how early-stage investors should look at valuation. What are they really looking for? is a requirement.

Valuation 198

Valuation Revenue Pre-Money Valuation Early Stage 198

Startup Professionals Musings

JUNE 26, 2013

It’s higher risk, but higher return, to pick the big winners early, before Angels have set unreasonable valuations and restrictive terms. More sources of funding for early-stage startups may drive up valuations on these deals, which will lower the returns for the Angels and super-Angels willing to do these deals.

Angel Investor 231

Angel Investor Entrepreneur Early Stage Silicon Valley 231

A Smart Bear: Startups and Marketing for Geeks

AUGUST 18, 2015

They have everything: money, brand, momentum, existing customers, press, product teams, distribution channels, expertise, market insight, analysts, sales offices, product features, and, by definition, a working business model. In the big-boy and big-girl world of real, at-scale companies, valuation is about total future earnings.

Technical Review 120

Technical Review Valuation Flash Revenue 120

Startup Professionals Musings

JANUARY 7, 2023

Perhaps the most famous bubble for startups was the dot.com craze that crashed 20 years ago, where the highest valuations were given to companies with massive user growth, but minimal revenue or profit. Never take your eye off the ball in business. Or ask PlanetRx, an online service for prescriptions, before the Internet was pervasive.

Intellectual Property 314

Intellectual Property Entrepreneur Bankruptcy Viral 314

Startup Professionals Musings

NOVEMBER 21, 2016

They know it’s especially hard to provide a financial return with a free business model. Declare a $10 million valuation with no revenue or customers. The average valuation for Angel investments is about $2.5 Lead with your intent to offer the solution free to customers.

Intellectual Property 120

Intellectual Property Valuation Technical Review Equity 120

Startup Professionals Musings

APRIL 17, 2023

At this point, most Angel investors and a few early-stage VCs will be happy to talk, assuming you have the business model validated, and a large opportunity. Prior to the growth stage, your company valuation is limited to goodwill based on intellectual property and team experience, since you have no revenue. Congratulations!

Angel Investor 313

Angel Investor Intellectual Property Investment Bankers Private Equity 313

Up and Running

SEPTEMBER 19, 2017

That’s because obtaining a pre-money valuation for a concept level technology company in excess of $1 million is difficult, particularly for a startup founder without a proven track record. By contrast, obtaining a pre-money valuation of $5 million for a business with a new viable product and even very minimal sales is somewhat reasonable.

Private Equity 94

Private Equity Pre-Money Valuation Equity Startup 94

Startup Professionals Musings

JUNE 21, 2020

Should they focus on increasing revenues and profitability, or entice more and more users with “free” services, to increase their valuation. A business only achieved critical mass by becoming cash-flow positive. Most are still confused about the right priority. Traditionally, it was simple.

Revenue 434

Revenue Valuation Viral Retention 434

Startup Professionals Musings

DECEMBER 11, 2022

Non-credible funding request or unreasonable valuation. Investors are looking to buy a chunk of the business, not the product. They need to know how much money you need, and what portion of the current business you are willing to offer for the investment. Future unproven projections don’t set today’s valuation.

Due Diligence 271

Due Diligence Intellectual Property Entrepreneur Preferred Stock 271

Both Sides of the Table

JUNE 22, 2011

In addition to FOMO it is partly driven by massive increase in valuations for earlier-stage companies who raised money at bit seed prices but who still have product risk. million pre-money valuation is now raising $1 million at a $12 million valuation the next investor has nowhere to go but up (or sit out the investment).

Saudi Arabia 309

Saudi Arabia Valuation IPO Technical Review 309

Startup Professionals Musings

JANUARY 7, 2013

The market and venture capitalists are looking for business, but with a continuing focus on proven business models. Here are some key action items that may give your business some visibility: Start with an investment-grade business plan. To make this work, you will need an initial valuation of at least $5M.

Venture Capital 252

Venture Capital IPO Elevator Pitch Initial Public Offering 252

Steve Blank

APRIL 26, 2022

At the turn of the century after the dotcom crash, startup valuations plummeted, burn rates were unsustainable, and startups were quickly running out of cash. Most existing investors (those still in business) hoarded their money and stopped doing follow-on rounds until the rubble had cleared. They’re Back.

Cram Down 417

Cram Down Founder Venture Capital Recapitalization 417

Hunter Walker

NOVEMBER 10, 2024

Now we have more and more consensus auctions where the price is an outcome of a VC’s ballooned business model and FOMO. These leads to both higher valuations earlier -AND- different underwriting targets for the larger fund (that is, $1b AUM fund is trying to get to 3x net, $60m seed fund is trying to get to 5x net).

Cap Table 97

Cap Table Dilution Valuation .Net 97

Startup Professionals Musings

OCTOBER 20, 2017

Due to the efficiencies of digital, it is now commonplace to have companies with billions of dollars of revenue and valuation, with few employees, and without years of building infrastructure. Think about the up-and-comers during the past decade that have either created new business models or stolen share from established players.

Technical Review 136

Technical Review Demand Valuation Business Model 136

VC Cafe

JANUARY 15, 2024

A billion dollar valuation, the Unicorn status was once the holy grail for many VCs and founders. At zero interest rates with a seemingly never ending flow of capital to fuel growth, Unicorn creation rate hit a peak in 2021, but fast forward 3 years and justifying a billion dollar valuation seems more like a liability.

IPO 88

IPO Valuation Israel Private Equity 88

Up and Running

AUGUST 17, 2022

Investors want to have a real shot at growing your valuation when they write you a check. They want your business to be able to scale up. This will be difficult if your business model doesn’t easily scale. If the answer is no, you may need to revisit your business model.

Venture Capital 146

Venture Capital Intellectual Property Angel Investor Bootstrapping 146

Startup Professionals Musings

SEPTEMBER 20, 2017

Some nonprofit entrepreneurs think they can skip the whole plan, rather than just the sections on valuation, equity offered, and exit strategy.

Angel Investor 132

Angel Investor Equity Technical Review Exit Strategy 132

VC Cafe

JANUARY 27, 2021

Next47 and American Insight Partners VC, demonstrates growing trust in its current and future business model. billion dollar valuation and has raised 170 million dollars in total merely eight months after its launch — making the British company arguably the fastest-growing startup in Europe.

Vertical 148

Vertical Video Technical Review Europe 148

Startup Professionals Musings

NOVEMBER 14, 2010

Unfortunately, we read far more poorly written business plans at Main Street than good ones. Entrepreneurs tend to write business plans that are difficult to read, heavy on technology, and give little thought to the business model and commercialization strategy. Participation.

Intellectual Property 265

Intellectual Property Balance Sheet Phoenix Arizona 265

VC Cafe

APRIL 4, 2024

Counter position – Kill the value-proposition of the competition with a new, superior business model, which the incumbent does not mimic due to anticipated damage to their existing business. This is the an important part of Hamilton Helmer’s 7 Powers , a solid framework for business strategy.

Generative AI 78

Generative AI Artificial Inteligence Technical Review ChatGPT 78