Both Sides of the Table

SEPTEMBER 28, 2014

So if your costs are $500,000 per month and you have $350,000 per month in revenue then your net burn (500-350) is equal to $150,000. But those of us with longer memories remember that the revenue line can move south very quickly when the market overall turns south. Gross burn is the total amount of money you are spending per month.

Burn Rate 383

Burn Rate Balance Sheet .Net Valuation 383

David Teten

AUGUST 19, 2019

So you’re interested in raising capital from a Revenue-Based Investor VC. A new wave of Revenue-Based Investors (“RBI”) are emerging. For background, see Revenue-Based Investing: A New Option for Founders who Care About Control. Rational burn profile, up to 50% of revenue at close, scaling down. Bigfoot Capital.

Revenue 60

Revenue Technical Review Software Review Equity 60

David Teten

JANUARY 19, 2021

More and more startups are pursuing Revenue-Based VCs , but “RBI” doesn’t fit everyone. Flexible VC 101: Equity Meets Revenue Share. By tying payments to actual revenues, founders and investors remain aligned around the company’s real-time performance, good or bad. Of the Inc. 5000 companies, only 6.5% raised from angels.

Cofounder 78

Cofounder Technical Review Equity Dividend 78

Tim Keane

MARCH 9, 2011

If, on the other hand, there is some near term prospect of cash flow (say within six months or a year) but no ability to repay in the meantime, then the entrepreneur may try and find a way to finance his “pre-revenue period” using friends and family money that accepts a somewhat lower payment in recognition of a relationship beyond just investing.

Finance 83

Finance Bootstrapping Startup Equity 83

Berkonomics

SEPTEMBER 13, 2010

The operations of the corporation become more complex. Bank loans with restrictive covenants are taken on. Then along comes either money or contracts from strategic or financial investors or partners. Ownership is spread among several classes of investors. The number of employees grows.

Covenant 59

Covenant Software Review Stock Options Vesting 59

Berkonomics

APRIL 4, 2024

The operations of the corporation become more complex. Bank loans with restrictive covenants are taken on. Then along comes either money or contracts from strategic or financial investors or partners. Ownership is spread among several classes of investors. The number of employees grows.

Covenant 48

Covenant Software Review Stock Options Vesting 48

Lightspeed Venture Partners

DECEMBER 10, 2012

Revenue is driven by children’s parties, which cost $600-$4,000 for a two hour party for 15 kids, which apparently is the market price for kids parties in LA. The space can host 6-9 parties per weekend, and they generated $350,000 in revenue last year. By all accounts, the Coop is quite successful.

Covenant 162

Covenant Warrant Southern California Los Angeles 162