Lightspeed Venture Partners

OCTOBER 7, 2012

The company has done $400k in sales in less than two years and had an early test deal with a local supermarket chain that they were massively overperforming on. He had been at it for 6 months and had no sales or distribution lined up yet. As he said, “Great innovations solve problems or reduce costs.

Technical Review 110

Technical Review Technical Cofounder Valuation Pre-Money Valuation 110

VC Cafe

SEPTEMBER 26, 2022

The press took notice, especially since just a few months later startups were laying off employees en-masse to cut costs. Sustainable growth: Prioritise sales efficiency over growth at all costs. A good way to think about valuation in seed/pre-seed is to reverse engineer the next round.

Founder 187

Founder Startup Valuation Pre-Money Valuation 187

Berkonomics

MARCH 30, 2010

Since this number is budgeted and pre-authorized, managers tend to focus upon other things such as sales, marketing and product development issues. There is an art to efficient management of a process, whether that is the process of bringing a product to market from R&D to production or developing a new product’s launch program.

Silicon Valley 85

Silicon Valley Burn Rate Angel Investor Down Round 85

ReadWriteStart

JUNE 1, 2020

It is going to cost a lot of money just to get the initial batch of products to test the market and would definitely require external funding. Instead of funding, you pay the investors a structured royalty, which is a portion of the sales. You might have seen that valuations of several unicorns were suddenly slashed down.

Startup 150

Startup Entrepreneur Elevator Pitch Seed Stage 150

Feld Thoughts

FEBRUARY 9, 2016

One of my favorite lines in buried in the middle: “I’ve heard enough companies say “we simply can’t cut costs or it will hurt the long-term potential of the business” to get a wry smile. Pragmatic cost cuts are always possible and often productive.” Then, if you end up doing a down round, it suddenly matters a lot.

Cap Table 70

Cap Table Down Round Liquidation Preference Founder 70

Startup Company Lawyer

MARCH 14, 2010

The only practical situation that I can think of where a dividend preference is beneficial to a stockholder is where a company does a partial sale of assets and wishes to distribute the proceeds to stockholders. Co-sale rights. Changes in preferred and merger/sale of assets only. Right of first refusal and co-sale agreement.

Finance 70

Finance Software Review Term Sheet Liquidation Preference 70

www.paulgraham.com

APRIL 28, 2010

For example, VCs generally write it into the deal thatin any sale, they get their investment back first. Some VCsnow require that in any sale they get 4x their investment backbefore the common stock holders (that is, you) get anything, butthis is an abuse that should be resisted. Onefounder I know wrote: Two-firm deals are great.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

abovethecrowd.com

APRIL 20, 2016

In Silicon Valley boardrooms, where “growth at all costs” had been the mantra for many years, people began to imagine a world where the cost of capital could rise dramatically, and profits could come back in vogue. Their own ego is also a factor – will a down round signal weakness? A down round is nothing.

IPO 40

IPO Term Sheet Silicon Valley Valuation 40

Reid Hoffman

JUNE 8, 2021

At the time, they said, it’s not enough to design a product that’s good for sales, it must also be good for the environment. The burden [should] just be that we care; that if we learn something, we improve it, and that we don’t only use single output metrics and its growth at all costs. It cost us nothing. Let’s go with debt.

Silicon Valley 69

Silicon Valley Hosting Rhode Island Design 69

Both Sides of the Table

MARCH 30, 2016

forward sales with some as high as 12x sales. Collectively we chose growth and the market was rewarding high growth rates over any other factor so we felt that we ought to bring in an experienced CEO who had taken companies public, who had led large, international sales organizations and who was poised to take Invoca to the next level.

Balance Sheet 150

Balance Sheet Burn Rate Valuation Forecast 150

NZ Entrepreneur

SEPTEMBER 16, 2020

For example, “How will unit cost affect our capital requirements and how will product pricing affect revenue?” Key Variables to Consider: Sales units. Founders are typically ambitious when projecting sales volumes. What if the number of sales is much less than expected? Timing of sales.

Startup 86

Startup Sales Cycle Down Round Revenue 86

Berkonomics

AUGUST 3, 2023

Some businesses require very little capital and the founder can self-finance the enterprise and retain 100% of its ownership and control from ignition through liquidity event (startup through sale). And even with the significant cost of credit card debt, many entrepreneurs aggressively use existing cards to finance a startup.

Private Equity 118

Private Equity Valuation Cap Table Accredited Investor 118

Berkonomics

JUNE 8, 2017

Some businesses require very little capital and the founder can self-finance the enterprise and retain 100% of its ownership and control from ignition through liquidity event (startup through sale). And even with the significant cost of credit card debt, many entrepreneurs aggressively use existing cards to finance a startup.

Private Equity 106

Private Equity Valuation Cap Table Accredited Investor 106

Growthink Blog

MAY 23, 2011

This venture capital financing - usually between $3 and $10 million - is the first of a number of rounds of outside investment over a period of three to five years. With this capital, the company propels itself to $50 million+ in revenues, and to either a sale to a strategic acquirer or to an initial public offering.

Angel Investor 112

Angel Investor Venture Capital Sweat Equity Cram Down 112

Berkonomics

JANUARY 20, 2010

Some businesses require very little capital and the founder is able to self-finance the enterprise and retain 100% of its ownership and control from ignition through liquidity event (startup through sale). And even with the significant cost of credit card debt, many entrepreneurs aggressively use existing cards to finance a startup.

Private Equity 69

Private Equity Valuation Cap Table Accredited Investor 69

Reid Hoffman

JUNE 8, 2021

At the time, they said, it’s not enough to design a product that’s good for sales, it must also be good for the environment. The burden [should] just be that we care; that if we learn something, we improve it, and that we don’t only use single output metrics and its growth at all costs. It cost us nothing. Let’s go with debt.

Silicon Valley 36

Silicon Valley Hosting Rhode Island Design 36

Scalable Startup

FEBRUARY 1, 2013

So the best technology for inventory management and for financial planning and for sales-force management and for online marketing can now be used just as easily or more easily by a small business. And they don’t buy sales-force automation software, they rent on Salesforce.com. Marc Andreessen: No, we have not seen down rounds yet.

Software Review 22

Software Review Startup Venture Capital Stock 22

David Teten

AUGUST 7, 2019

“You could argue that when they were [raising] oversubscribed [VC rounds], Facebook, Google, Amazon, etc., The reverse also holds: a Value investment can become Momentum, and then follow with a down round. When you invest in a Momentum company, everyone immediately congratulates you on your wisdom, sales skill, and success. .

Venture Capital 60

Venture Capital Valuation Stock NDA 60

Altgate

MARCH 8, 2009

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. But some will be saved.

Later Stage 34

Later Stage Early Stage Venture Capital Portfolio 34

Scalable Startup

OCTOBER 26, 2011

The second round is often for some or all of the following – corporate growth, go to market, turn the prototype into a robust offering, marketing costs, or to hire a sales force. It’s no longer based on a hunch, unless the company is in trouble and needs money to finish what the first round started.

Mezzanine 22

Mezzanine Due Diligence IPO Angel Investor 22