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Many of these businesses were what First Round Capitalcalled FNACs (features, not companies – this acronym has always stuck with me). Let’s take your revenue line. Great product managers who are not great business people still often fail. How will your costs scale as your revenue scales. portfolios.
And if your fund does well – i.e. your companies either raise more money or they grow their revenues a lot – you also don’t make more money, because your salary is based on a percentage of your fund size. In many cases, fund managers invest 1-5% of the fund size. You can’t throw in the towel.
And if your fund does well – i.e. your companies either raise more money or they grow their revenues a lot – you also don’t make more money, because your salary is based on a percentage of your fund size. In many cases, fund managers invest 1-5% of the fund size. You can’t throw in the towel.
Growth stage investors are usually the Series B or C investors who come in when the product is in the market but there is little or no revenue and the team is probably in the 20-something range with the goal to ramp it up to 40-50 employees with the new money, build out a sales team, etc. trillion as late as last month. Also, the $1.5
Rarely is there any formal written agreement memorializing these initial expectations and stating the consequences of non-performance or inability to make capitalcalls when required. The agreement was that he would retain all the revenues generated from those activities and that I would finance the company and manage it.
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