Both Sides of the Table

FEBRUARY 15, 2016

How much your company should burn should also have a direct correlation with whom your existing investors are and I strongly advise that you have open conversations with them about their comfort levels and also the level of support you are likely to receive going forward.

Burn Rate 150

Burn Rate Cap Table Valuation Software Review 150

View from Seed

FEBRUARY 23, 2021

Not everyone will get in, but the founder is most likely to pick from those already around the table vs. opening up new conversations. The average investor is fairly harmless, and even if they aren’t as helpful as one would hope, they rarely create major headaches.

Syndication 207

Syndication Syndicate Term Sheet Cofounder 207

View from Seed

SEPTEMBER 23, 2019

My partner Rob has previously written some thoughts on how to approach that conversation. What not to include is directly stating valuation expectations.

Cap Table 211

Cap Table Seed Stage Valuation Dilution 211

View from Seed

FEBRUARY 12, 2020

I notice some founders (from YC in particular) have been trained to say something like: “we are just starting the process, but things are moving faster than we expect and we are already scheduling follow-up conversations and partner meetings.”. Some founders lay out a specific time frame for when they hope to get the round closed.

Term Sheet 364

Term Sheet Burn Rate Founder Partner 364

YoungUpstarts

APRIL 17, 2019

Focus on the conversation. Translate conversation into clear actions. This can result in you either missing key elements or not being able to add value by processing the current conversation. Having a single person or entity focused on creating a record of the conversation allows the rest of you to have something to go back to.

Conversion 184

Conversion Curation California Lead Investor 184

David Teten

SEPTEMBER 5, 2014

I’ve also presented at a range of industry conferences on how institutional investors can use professional networks for research , origination , market research , and value creation. Over the past 15 years we’ve built this amazing membership to serve our core clients – leading investors, corporations, consulting firms, and nonprofits.

New York 114

New York Technical Review Networking Advisory Board 114

Hunter Walker

SEPTEMBER 12, 2022

And while I passed on leading their seed, I did contribute a smaller amount into the financing, along with three subsequent pro rata/super pro rata investments. I agreed and we subsequently did a TechCrunch Live discussion together with a follow-up blog post in her newsletter.

Cofounder 99

Cofounder Lead Investor Founder Restful 99

techcrunch.com

APRIL 26, 2013

First, AngelList Invest is available to any company on AngelList that has a top-tier lead investor. And the lead investor has to be putting in at least $100,000 in capital, says Ravikant. Using today’s data on AngelList, that includes 300 startups. Other criteria include that the startup needs to be U.S.-based,

SEC 61

SEC Accredited Investor San Diego New York City 61

OnlyOnce

APRIL 27, 2021

Here are four tough conversations you may have to have along the way, with some suggestions on how to navigate them. All of these conversations need to come with a point of view of why independence and diversity matters to your company, a lot of empathy, and appreciation for the value the person brings to the table.

Vesting 48

Vesting Cofounder Startup Term Sheet 48

Pascal's View

JULY 9, 2017

At its core, this issue points to the lack of understanding about the importance of post-money valuation by both entrepreneurs and investors. This is not uncommon—and it is a problem precisely because the notes are being used improperly.

Post-Money Valuation 49

Post-Money Valuation Valuation Cap Table Covenant 49

View from Seed

JANUARY 11, 2021

Said one investor, “We may have overdone it on socialization at the expense of productivity.”. Of the eight venture capitalists we interviewed, six commented that they felt more efficient and were able to have more early conversations during this period than before.

Venture Capital 350

Venture Capital Cofounder Early Stage Seed Stage 350

Hippoland

APRIL 9, 2017

This leads investors to believe that there is something either really wrong with your business or that you, as a founder, are not sharp. Either your existing leads are junk / not qualified, in which case, you should own up to it. But, whatever it is, something doesn’t add up, and you need to be able to address this.

Cofounder 48

Cofounder Early Stage Software Review Naming 48

View from Seed

OCTOBER 21, 2014

Using NextView as an example, since we both seek to lead the seed round and only lead during this round, I’ve seen this trend manifest in one of two ways: In a priced round, the entrepreneur will often share their valuation ask (or a stated floor) for the pre-money valuation of their company much sooner in the process.

Valuation 336

Valuation Founder Seed Stage Angel Investor 336

Hunter Walker

SEPTEMBER 27, 2021

While a norm of ‘we don’t invest in directly competitive companies’ is likely the median response if you asked a bunch of investors, in truth there’s always an asterisk. Sometimes this applies only to lead investors, and if they consider the investment ‘active’ (eg on the board, still doing their pro rata, etc).

Early Stage 117

Early Stage Cofounder Vertical Portfolio 117

This is going to be BIG.

JANUARY 3, 2021

The other day, my wife Aja Singer and I were having a conversation about being more intentional with our time, especially when it comes to working. What we found was that doing this exercise together created the space for really productive conversations about how we spend our time. I’m pretty lucky because I control most of my time.

Management 120

Management Portfolio LP Social Media 120

This is going to be BIG.

FEBRUARY 27, 2011

The right lead investor and the right amount of cushion in a raise can help with the best defense against scaling disaster—hiring. Wouldn’t it be better to walk into a hiring conversation knowing that you can’t be outbid for the dream hire? Make sure you’ve got sure footing to get to the next level.

Dilution 104

Dilution Equity Hiring Partner 104

Startup Lessons Learned

JULY 2, 2020

She believed so deeply in Curative's new mission and the science behind it that she went out and pitched investors on a company she didn't even work for--and got results. You can listen to our conversation on Apple , Google, or wherever you like to download podcasts. Here's my conversation with Curative.

Curation 60

Curation Government Los Angeles Partner 60

leananalyticsbook.com

AUGUST 19, 2012

Transactional sites are about shopping cart conversion, cart size, and abandonment. There are good studies that show a strong correlation between site performance and conversion rates, so startups ignore this stuff at their peril. This is important because it has a big impact on conversion rates. I’ll explain.

Metrics 58

Metrics Clickthrough Lean Analytics 58

Genuine VC

JULY 30, 2012

By communicating pricing expectations with potential lead investors, I mean sharing either an “ask” or even stated floor for the pre-money valuation of the company (with a priced preferred round) or explicitly stating a valuation cap (for convertible note round).

Valuation 136

Valuation Pre-Money Valuation Angel Investor Syndication 136

mashable.com

NOVEMBER 2, 2011

Look for Your Lead Investor. First you’ll want to find a lead investor — someone many other investors will recognize and respect. This list of top angel investors is a good start. When you make contact, send them a link to your AngelList profile early on in the conversation.

Social Media 80

Social Media Startup Angel Investor RSS 80

Both Sides of the Table

MAY 30, 2018

Before raising capital you need to have a conversation with your existing investors to get a sense on what they’re thinking or at a minimum you better have an intuitive feel for it. Many investors can also be the opposite situation where you’re so successful that everybody wants to invest.

Valuation 324

Valuation Post-Money Valuation Pre-Money Valuation Cofounder 324

VC Adventure

MAY 21, 2014

A few months ago AngelList announced Syndicates - enabling investors on AngelList to create fund-like groups of investors to invest together in AngelList companies (following a single lead investor). We were the first formal venture fund to do this. And they do look at terms so structuring a fair deal is important.

Syndication 93

Syndication Syndicate Technical Review Due Diligence 93

SoCal CTO

SEPTEMBER 8, 2010

thought it would be helpful to put some of my thoughts into a blog post and hopefully spur some conversation in the comments and over email. While I agree that many VCs are crummy seed investors, I think there are some that are excellent seed investors. More tiers = more complication = more confusion. twenty in your wallet?

Startup 191

Startup CTO Hire Cofounder Venture Capital 191

Austin Startup

SEPTEMBER 27, 2011

Spredfast, a leading social media management system provider, today announced it has raised $12 million in Series B funding led by InterWest Partners. Also participating in the round is Austin Ventures, the lead investor of the company’s $3.6 million Series A round.

Lead Investor 74

Lead Investor Social Media Austin Channel 74

Feld Thoughts

MAY 3, 2010

The great companies that I’ve been an investor in share a common trait – the founder/CEO is obsessed with the product. All of the conversations about customer are really about how the customer uses the product and the value the product brings the customer. Not interested, not aware of, not familiar with, but obsessed.

Product 148

Product Cofounder Lead Investor Software 148

Both Sides of the Table

MARCH 6, 2011

Might as well cut off our conversation and just restart it 48 hours later on camera for This Week in VC. I ask Naval about the importance of a lead investor. My opinion is that it’s very important to raise money from someone who is helpful and reputable and is willing to bring in the same types of investors.

Valuation 292

Valuation Deal Flow Lead Investor Cofounder 292

Gust

OCTOBER 26, 2011

This is the norm for West Coast deals, but it’s often the case in dealing with East Coast investors (more commonly for VC financing rounds rather than angel seed rounds) that the lead investor wants its lawyers to draft the documents. See discussion of amendments below.) merger or acquisition).

Finance 79

Finance Term Sheet Covenant Accredited Investor 79

Scott Edward Walker

JUNE 9, 2019

Pro rata rights are relatively standard and non-controversial; however, founders should try to limit such rights solely to “Major Investors” (which is typically defined to include only those investors that will own a substantial number of shares – e.g., a lead investor).

Preferred Stock 56

Preferred Stock Term Sheet Dilution Stock 56

Version One Ventures

JANUARY 28, 2013

Since CBInsights released its report in December, conversations have accelerated about the pending “Series A Crunch.” Not having a lead investor in your seed round can make it tougher to pull together a bridge round or follow-on financing down the road, since no single investor feels in charge or vested in your success.

Burn Rate 140

Burn Rate San Francisco Vesting Finance 140

Both Sides of the Table

JUNE 5, 2015

I am reminded of this problem every time my firm does a financing where a note went before us but more specifically I was reminded by this great post by Brad Feld to talk about the pre-money vs. post-money conversion issue. If you think the other investors will be super value-added – no problem! For me it’s clear.

Pre-Money Valuation 150

Pre-Money Valuation Option Pool Post-Money Valuation Dilution 150

David Teten

SEPTEMBER 6, 2015

Some corporate funds now lead rounds. Others follow independent financial lead investors and most require that independent investors be part of the syndicate. Teten: What makes for a good vs. bad corporate venture investor? Corporate VCs are at the table with all the other venture funds.

Venture Capital 60

Venture Capital Balance Sheet Technical Review Portfolio 60

VC Adventure

MAY 21, 2014

A few months ago AngelList announced Syndicates – enabling investors on AngelList to create fund-like groups of investors to invest together in AngelList companies (following a single lead investor). We were the first formal venture fund to do this.

Syndication 48

Syndication Syndicate Technical Review Due Diligence 48

Hunter Walker

JANUARY 10, 2022

I really enjoy our conversations and am especially glad you’re up for some candor, because it’ll help provide some insight into the state of the startup and funding market. The needs of the lead investor for ownership? A round that is most accommodating for the existing investors while allowing you to get new people involved?

Cofounder 93

Cofounder Founder Acquisition Startup 93

Up and Running

JANUARY 25, 2017

The lead investor, the individual that seemed the most optimistic about our pitch, was surprised to hear from me so soon. I was surprised he answered the phone; most investors don’t want to take follow-up calls from people that have recently pitched them. But I was too upset to sleep. The call ended with a job offer.

Venture Capital 60

Venture Capital Cofounder Security Partner 60

Hippoland

JANUARY 4, 2017

Usually, an equity round is kicked off by a “lead investor”. Typically, this lead investor decides the terms of the round and also invests the majority of the money that will go into your company. That lead investor will also usually help you fill out the remainder of your round with other investors.

Convertible Security 48

Convertible Security Equity Security Silicon Valley 48

Both Sides of the Table

OCTOBER 14, 2009

That’s what “information rights&# are for and you can promise the investor to meet 1-on-1 on a quarterly basis. The second scenario is where there are too many investors (egos?) I’ve never seen a junior VC person speak out and try to drive the conversation with the partner also in attendance. in a company.

Advisory Board 215

Advisory Board Strategic Investors Venture Capital Later Stage 215

ithacaVC

DECEMBER 9, 2018

Doors open, conversations are easier, business happens. Sure, the person will ultimately typically need to be mutually agreeable to the lead investor and founders but having the founders source the person strikes the right balance in my opinion. This is common sense. The benefits of the credibility boost are enormous.

Stock Options 40

Stock Options Salary Lead Investor Founder 40