Both Sides of the Table

MAY 23, 2012

Yes, it’s true that FOMO (fear of missing out) is driving some irrational behavior and valuations amongst uber competitive deals and well-financed VCs. The mobile world brings enormous business opportunities and changes to business models that were unthinkable when VCs made investments ten years ago that produced the last decade of results.

Venture Capital 347

Venture Capital Technical Review LP Mobile 347

www.forentrepreneurs.com

FEBRUARY 2, 2010

Business Model I would like to propose that in addition to team, product, and market, there is actually a fourth, equally important, core element of startups, which is the need for a viable business model. For more on the topic of Viral Growth, refer to my blog post on that topic here.)

Acquisition 103

Acquisition Cost Customer Entrepreneur 103

Startup Professionals Musings

JUNE 26, 2016

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 145

Revenue Valuation Startup Viral 145

Startup Professionals Musings

AUGUST 10, 2014

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 246

Revenue Entrepreneur Valuation Viral 246

Startup Professionals Musings

NOVEMBER 11, 2013

The discipline of writing down a plan is the best way to make sure you actually understand how to transform your idea into a business. Business model doesn’t make money. Intellectual property is also often the largest element of early-stage company valuations for professional investors. Inexperienced team.

Intellectual Property 251

Intellectual Property Startup Viral Early Stage 251

YoungUpstarts

FEBRUARY 14, 2017

It now has a multi-billion dollar valuation. The Different Ways Your Business Can Pivot. Once you’ve identified that your business needs to pivot in order to grow, it times to decide how. Business architecture pivot. Implementing the right model can have a significant impact on growth and success. Channel pivot.

Technical Review 157

Technical Review Architecture Revenue Channel 157

Startup Professionals Musings

OCTOBER 1, 2012

The discipline of writing down a plan is the best way to make sure you actually understand how to transform your idea into a business. Business model doesn’t make money. Intellectual property is also often the largest element of early-stage company valuations for professional investors. Inexperienced team.

Intellectual Property 274

Intellectual Property Entrepreneur Viral Early Stage 274

reidhoffman.org

NOVEMBER 12, 2013

Friendster’s valuation set the tone for the entire social networking space. Press and analysts characterized LinkedIn in one of two ways: “LinkedIn is an interesting niche that might be worth paying attention to” or “LinkedIn is the Friendster for business”. We are the leader in the professional domain with viral growth.

Entrepreneur 111

Entrepreneur Viral Revenue Networking 111

Steve Blank

MARCH 18, 2011

The signals are loud and clear : seed and late stage valuations are getting frothy and wacky, and hiring talent in Silicon Valley is the toughest it has been since the dot.com bubble. Underwriters realized that as long as the public was happy snapping up shares, they could make huge profits from the inflated valuations. Carpe Diem.

Internet 335

Internet IPO Silicon Valley Agile 335

View from Seed

JUNE 11, 2019

I believe it’s more important to optimize on the right lead investor vs. the highest valuations at the seed stage (within reason). I’d make a list of your most important priorities and risks for the business in the next 12 months and shape your syndicate around those skills.

Syndicate 202

Syndicate Syndication Seed Stage Lead Investor 202

Startup Professionals Musings

JANUARY 9, 2015

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. More than one smart entrepreneur has been caught in the lofty lifestyle of big money investors, viral growth, and movie star status.

Intellectual Property 120

Intellectual Property Startup Bankruptcy Viral 120

Gust

NOVEMBER 3, 2013

The discipline of writing down a plan is the best way to make sure you actually understand how to transform your idea into a business. Business model doesn’t make money. Intellectual property is also often the largest element of early-stage company valuations for professional investors. Inexperienced team.

Intellectual Property 183

Intellectual Property Startup Viral Early Stage 183

betashop.com

OCTOBER 8, 2012

It has been awesome, flattering, and humbling to see that post went viral and has been seen by so many thousands of people — mainly aspiring entrepreneurs — and has been translated into many languages. But, you can iterate and iterate on features, but you cannot iterate your way to a business model.

Technical Review 108

Technical Review Technology Software Review Valuation 108

Version One Ventures

DECEMBER 7, 2016

As investors, we love the underlying business models, including the daily use case, virality, and network effects. There are chapters on metrics, exits, valuations, as well as our outlook for future opportunities in social. Why social? As individuals, we use social platforms on a daily basis.

Artificial Inteligence 60

Artificial Inteligence Viral Valuation Networking 60

Cracking the Code

NOVEMBER 13, 2008

The fact that SaaS valuations are being more affected by the downturn than the Nasdaq can be surprising given the supposed resiliency of the SaaS model (recurring revenues) but it translates the public investors belief that SMB software spend is going to be hit very hard by this recession. SaaS 13 Index Valuation. anecdotes. (13).

Software Review 48

Software Review Technical Review Valuation Portfolio 48

Reid Hoffman

JANUARY 19, 2021

When I was starting LinkedIn, I had an early board member who asserted to me with great vigor and certainty that the business model of LinkedIn would be advertising. We should focus on this as an advertising business.” Reid, the game is engagement and advertising. Everything else is a waste of time.

Startup 36

Startup Cofounder Advertising Hiring 36

Cracking the Code

DECEMBER 2, 2006

Today, VARs are the key to the SMB segment and their business model is collapsing, opening new opportunities for them and for technology providers. To survive, VARs need to change their business model and move from product sales to services. Detailed SaaS Spreadsheet (Valuation and CAC benchmark). My Investments.

Software Review 48

Software Review Technical Review Europe Software 48

Lightspeed Venture Partners

NOVEMBER 12, 2012

Season 4 week 9 of Sharktank was another fun episode, showing the importance of failing fast, being prepared for your pitch and how selecting an investor is about more than just optimizing valuation. And his business is taking on a very crowded market that has been around for a long time. Drive Suits. All entrepreneurs have passion.

Valuation 107

Valuation Post-Money Valuation Viral Algorithm 107

ReadWriteStart

JANUARY 27, 2011

And, oh by the way, we also really like the idea of the 1M/1M entrepreneurs building valuation and negotiating leverage through these business development efforts, instead of signing off large chunks of their company in form of equity early on. The game has started getting some traction already, and has a good virality index.

Dilution 114

Dilution Revenue Finance Entrepreneur 114

Cracking the Code

OCTOBER 10, 2008

You validated our business model and added huge value to our efforts. However, as we know from the cable industry, subscription businesses can be very profitable over time. For a direct, enterprise sales business model, these thresholds are likely to be around $80,000-100,000 CMRR (approx. $1-1.2M Michael Kassing.

Software Review 48

Software Review North America Europe Metrics 48

crowdSPRING Blog

MAY 8, 2015

Valuation As A Scorecard – buff.ly/1F0CUyC. Online Courses Accelerate Any Business Model bit.ly/1InOB3Z. Using PPC Marketing to Make Content Go Viral: Here’s How It Works crowdspring.co/1InOIwn. The Illusion of Product/Market Fit for SaaS Companies – buff.ly/1dPLqGE. 1InLxVh.

Small Business 48

Small Business Design Social Media Startup 48

Cracking the Code

DECEMBER 16, 2006

Detailed SaaS Spreadsheet (Valuation and CAC benchmark). SaaS 13 Index Valuation. Popular Media: the key to viral marketing. S&M productivity (CAC ratio) for the SaaS 13 Index. Note: high CAC ratio means high productiviy (see blog post for definition). My Investments. CornerstoneOnDemand. anecdotes. (13). Cloud Computing. (1).

Software Review 48

Software Review Silicon Valley Technical Review Software 48

Steve Blank

FEBRUARY 26, 2020

For a Series A round you want to prove you have built a repeatable and scalable sales/revenue model and understand all parts of the business model. Series B is about proving your net revenue model (can you be profitable?). Team, Product, Traction, Business Model and Market. Business Model.

Cofounder 433

Cofounder Seed Stage Valuation Metrics 433

Reid Hoffman

JANUARY 26, 2021

One common mistake is for entrepreneurs to simply select whichever venture capital firm is offering the highest valuation. For a business issue, I’ll say something like, “Here are three reasons why advertising might be this company’s most important business model. This is why advertising is a really good business model.

Startup 36

Startup Equity Early Stage Green 36

Cracking the Code

SEPTEMBER 2, 2008

If that were the case, most of the Cable and Wireless companies who have been using a similar business model would have gone bankrupt a long time ago and Saleforce would not have 20% FCF margins today. It is true that understanding this new business model is hard for a traditional software incumbent, as this interview demonstrates.

Software Review 48

Software Review Software Technical Review Cloud 48

YoungUpstarts

JANUARY 11, 2018

We created virality in small pockets, such as Venice Beach, California, and the virality spilled over to the next pocket, Santa Monica. Nailing it before you scale it can change how much you’re able to raise from investors and the valuation at which you raise.

Los Angeles 133

Los Angeles Investment Bankers Cofounder Viral 133