Startup Professionals Musings

APRIL 4, 2022

The “valley of death” is a common term in the startup world, referring to the difficulty of covering the negative cash flow in the early stages of a startup, before their new product or service is bringing in revenue from real customers. Nevertheless, it’s an option that doesn’t cost you equity. Join a startup incubator.

Intellectual Property 261

Intellectual Property Technical Review Incubator Bootstrapping 261

Startup Professionals Musings

APRIL 14, 2021

For example, my dictate that entrepreneurs need to find a “ painful ” problem to solve (such as high cost, low productivity) to attract customers, doesn’t really account for many successful startup businesses today, including top social media platforms, dating sites, and new fashions. All of these tend to override cost and usability.

Customer 432

Customer Social Media Dividend Technical Review 432

The Startup Magazine

FEBRUARY 3, 2022

When these operations are efficient, companies can meet customer demand quickly and maintain stable costs. If warehouse productivity is low, companies lose not just money but credibility also. However, warehouse productivity and efficiency depend on many factors. Employee motivation is closely linked with productivity.

Software Review 166

Software Review Product Technical Review Operations 166

Startup Professionals Musings

JUNE 24, 2020

Everyone knew these had potential, but had not demonstrated success to date due to infrastructure and support requirements, or cost constraints. Many investors and big companies are putting money into this space or adding it their product line today. Typical valuations range from 3x-5x revenues.

Artificial Inteligence 436

Artificial Inteligence Marketing Valuation Startup 436

Startup Professionals Musings

NOVEMBER 28, 2020

But for founders who do their homework, the cost of entry is lower and the opportunity is higher than ever. Building a minimum viable product, with customer validation. Years ago, it cost a million dollars for a new e-commerce site, one that you can now create for almost nothing with current tools and technology.

Intellectual Property 404

Intellectual Property Startup Angel Groups Social Media 404

Startup Professionals Musings

AUGUST 19, 2020

Things will cost more than you expect. Deferred payments start with stretching the payables period but, more importantly, include giving employee equity in lieu of a higher salaries and negotiating vendor deferred payments out of future revenues. Cash flow out equates to burn rate, and the runway depends on your reserves.

Burn Rate 310

Burn Rate Hockey Stick Salary Angel Investor 310

Startup Professionals Musings

DECEMBER 5, 2021

Every time I challenge a business plan with little or no budget for marketing, I get the answer that they will be using “viral” marketing, which costs nothing. It usually implies an opportunity to win big, like a lottery, or experience something sensational, like an incredible video or free product. Develop viral content.

Viral 348

Viral Marketing SEM Campaign 348

Startup Professionals Musings

MARCH 6, 2021

I’m sure all you accountants will agree that fixing the mistakes listed here does not require rocket science, but I’ve seen them so often that to be forewarned is to be forearmed: Failing to factor in fixed costs when pricing. Always use a break-even analysis to measure what volume and price are required to offset total costs.

Technical Review 379

Technical Review Finance Startup Salary 379

The Startup Magazine

AUGUST 12, 2024

Part of the reason this value is taking longer than expected to emerge is due to operating costs. Moreover, these costs increase exponentially with the size of the data sets that algorithms process. Meanwhile, 41% of companies consider the high costs involved in ML experimentation to be the main challenge they face.

Technical Review 167

Technical Review Cost Artificial Inteligence Analytics 167

Startup Professionals Musings

FEBRUARY 14, 2022

I see more and more entrepreneurs who seem to have everything going for them – vision, motivation, passion, even a good business plan, product, and money, and yet they can’t close customers. For example, when you think about distribution channels, revenue streams, or the relationship with the customer, ask customers what they expect.

Angel Investor 359

Angel Investor Technical Review Incubator Business Model 359

Startup Professionals Musings

JUNE 2, 2021

As a simple example, the Wal-Mart website now shows shoppers more products that they may like, based on previous purchases. Short-term earnings per share may be low, even as revenues and cash burned are high. Find funders who seek long-term returns. Money-making is different in the digital age.

Software Review 355

Software Review Algorithm Global IPO 355

Startup Professionals Musings

OCTOBER 26, 2022

With social media and smart phone apps, real product information spreads at astounding speeds. Business agility is defined as the ability to adapt rapidly and cost efficiently. An agile business doesn’t wait for their current product line to fail, before planning some enhancements. Continually watch for new opportunities.

Agile 379

Agile Technical Review Leadership Social Media 379

Startup Professionals Musings

AUGUST 23, 2020

Every startup success is a function of great people, products, and profits. Leapfrog products invent and reinvent markets. Incremental product ideas do not change markets. The basic premise is that if a startup expects paying customers to use its products or services, it should expect no less from its own team.

Technical Review 324

Technical Review Entrepreneur Due Diligence Business Model 324

Startup Professionals Musings

OCTOBER 30, 2020

Products that can be easily produced and sold via multiple channels, including the Internet, are more easily scaled world-wide. You need a stable customer base with an automatically renewing revenue stream, such as the subscription model. Take advantage of low-cost modern tools and automation.

Merger 386

Merger Acquisition Software Review Social Media 386

Startup Professionals Musings

FEBRUARY 8, 2020

Plan to deliver a family of products, rather than a one-trick pony. Even a great initial product, with no follow-on, won’t keep you ahead of competitors very long. A smarter risk is to build a plan, with associated greater resources, that will put you in position to expand your product line and keep one step ahead of competitors.

Management 322

Management Entrepreneur Forecast Stock Options 322

Startup Professionals Musings

MAY 14, 2023

Things will cost more than you expect. Deferred payments start with stretching the payables period but, more importantly, include giving employee equity in lieu of a higher salaries and negotiating vendor deferred payments out of future revenues. Cash flow out equates to burn rate, and the runway depends on your reserves.

Burn Rate 258

Burn Rate Hockey Stick Management Salary 258

Steve Blank

SEPTEMBER 5, 2018

Reading the NY Times article “ Jeffrey Katzenberg Raises $1 Billion for Short-Form Video Venture, ” I realized it was time for a new startup heuristic: the amount of customer discovery and product-market fit you need to find is inversely proportional to the amount and availability of risk capital. ” Fire, Ready, Aim.

Lean 335

Lean Burn Rate Startup IPO 335

Startup Professionals Musings

NOVEMBER 2, 2022

Plan to deliver a family of products, rather than a one-trick pony. Even a great initial product, with no follow-on, won’t keep you ahead of competitors very long. A smarter risk is to build a plan, with associated greater resources, that will put you in position to expand your product line and keep one step ahead of competitors.

Forecast 304

Forecast Stock Options Technical Review Metrics 304

The Startup Magazine

DECEMBER 29, 2022

These include high costs, competition, and shifting regulations. According to IBIS World, the revenues generated by the hotels and motels industry in 2022 have reached $258.1 Leveraging Revenue Management Solutions. Revenue management is the practice of managing the flow of revenue in and out of a business.

Management 158

Management Software Review Revenue Cost 158

The Startup Magazine

JANUARY 19, 2025

Image source Startups often face unpredictable revenue streams and mounting operational costs, making cash flow management particularly challenging. For example, startups might find they are paying for unused software subscriptions or can renegotiate vendor contracts to save costs.

Management 143

Management Startup Forecast Finance 143

Steve Blank

APRIL 1, 2020

Any place with a fixed cost that relies on foot traffic will come under pressure. Your revenue plans are no longer valid. What’s your monthly cash burn at your new low revenue level? Cut costs to stay alive for 24 months. Payroll costs/other variable costs. The ripple effects won’t be obvious at first.

South Korea 334

South Korea Salary Business Model China 334

Startup Professionals Musings

FEBRUARY 24, 2019

Every time I challenge a business plan with little or no budget for marketing, I get the answer that they will be using “viral” marketing, which costs nothing. The founder explains that the product is so “buzz-worthy” that usage will spread rapidly through word-of-mouth only, meaning people loving it and recommending it to their friends.

Viral 268

Viral Marketing SEM Campaign 268

Startup Professionals Musings

FEBRUARY 8, 2023

Most business professionals I know have been conditioned to think of inflation as highly negative, driving up their costs, and reducing customer buying. I see it as an opportunity to find new ways to attract customers , make long-needed changes to improve productivity, and lower your own costs of doing business.

Technical Review 239

Technical Review Revenue Social Media Cost 239

TechEmpower

JULY 31, 2023

One way to approach that last question is to use this simple model: Customer Acquisition Cost (CAC) How will your business reach prospects? And how much will it cost to win them? Start by building just enough of your product to get early CAC and CLV signals (they won’t be perfect). Apply costs to each channel.

Metrics 260

Metrics Startup Retention Acquisition 260

Startup Professionals Musings

FEBRUARY 1, 2020

With social media and smart phone apps, real product information spreads at astounding speeds. Business agility is defined as the ability to adapt rapidly and cost efficiently. An agile business doesn’t wait for their current product line to fail, before planning some enhancements. Continually watch for new opportunities.

Agile 315

Agile Technical Review Leadership Social Media 315

YoungUpstarts

NOVEMBER 2, 2020

You’re not aggressively creating products and experiences that take full advantage of the potential of digital. A Salesforce study found that 80 percent of customers view “the experience” a company provides as equally important as its products and services. REASON 2: You Need to Gain the Efficiencies to Be Cost-Competitive.

Valuation 264

Valuation Technical Review Revenue Operations 264

The Startup Magazine

MAY 30, 2022

This, on the other hand, can severely cut into your revenue. Whether your products are big and heavy or small and fragile, you should properly prepare them for shipment. Crumpled paper and bubble wrap are the best options for fragile products. These things don’t cost much. Image Source. Use Suitable Package Size.

Small Business 166

Small Business Software Review Technical Review Early Stage 166

Startup Professionals Musings

SEPTEMBER 16, 2023

But for founders who do their homework, the cost of entry is lower and the opportunity is higher than ever. Building a minimum viable product, with customer validation. Years ago, it cost a million dollars for a new e-commerce site, one that you can now create for almost nothing with current tools and technology.

Intellectual Property 261

Intellectual Property Entrepreneur Angel Groups Social Media 261

Startup Professionals Musings

MAY 25, 2020

Investors know that the fun of a startup turns into managing production processes, sales processes, and personnel in a few years. According to National Venture Capital Association statistics , only 16% of venture-backed startups recently used this alternative, due to high liability concerns, demanding shareholders, and high costs.

Exit Strategy 376

Exit Strategy Startup Private Equity Equity 376

The Startup Magazine

JULY 8, 2022

After all, the freemium pricing model is an excellent way to launch new products and gain exposure quickly. The idea behind the strategy is to provide the target audience with some basic services or features at zero cost to attract prospects. While the service may be free to users, it’ll still cost you.

Startup 158

Startup Technical Support Software Development Software Developers 158

Startup Professionals Musings

MAY 15, 2019

Steve Blank via Flickr by jdlasica I see more and more entrepreneurs who seem to have everything going for them – vision, motivation, passion, even a good business plan, product, and money, and yet they can’t close customers. Don’t forget a viable financial model of costs, margins, customer acquisition, and break-even.

Startup 245

Startup Angel Investor Technical Review Incubator 245

Startup Professionals Musings

MARCH 21, 2020

Investors are buying part of the business, not the product or service. They only want a quick overview of the product, not detailed features and patent secrets. If you haven’t yet finalized the business model, cost projections, and customer segments, you aren’t ready for investors.

Technical Review 310

Technical Review Angel Investor Business Plan Social Media 310

Startup Professionals Musings

SEPTEMBER 17, 2021

Entrepreneurs set the price of their solution based on their costs, and their perception of value. Customers set value based on similar products found. With the best solutions, the customer gets value which exceeds your revenue. Your price and their value are not the same thing. For example, with smartphone apps, most are free.

Sales 348

Sales Startup Bootstrapping Technical Review 348

VC Cafe

MARCH 1, 2024

Creating remixable outputs – allowing creators to expose their prompts and make their work instantly remixable Enabling consumers to build content creation apps – products that help users “chain” together models and prompts behind the scenes – and then save these workflows and / or publish them for others to use.

Artificial Inteligence 176

Artificial Inteligence Technical Review Software Review Generative AI 176

Startup Professionals Musings

JUNE 21, 2020

Some analysts argue that revenue drives growth, while others say user growth drives revenue. Google reached $1B in revenue within five years of incorporation, and now has a market capitalization of over $1 trillion. Long-term stability requires revenue growth and profit. Both have worked. Traditionally, it was simple.

Revenue 434

Revenue Valuation Viral Retention 434

The Startup Magazine

MARCH 6, 2024

The main reasons are: Ever-evolving Customer Base: From mobile phones to customised gadgets, from televisions to Desktop Computers, the consumer base is getting more diverse and assorted, with different age groups, genders, ethnicities, and races demanding different products and services.

Operations 158

Operations Management Software Review Technical Review 158

Startup Professionals Musings

MAY 19, 2023

Every startup success is a function of great people, products, and profits. Leapfrog products invent and reinvent markets. Incremental product ideas do not change markets. The basic premise is that if a startup expects paying customers to use its products or services, it should expect no less from its own team.

Technical Review 229

Technical Review Due Diligence Business Model Demand 229