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

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

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

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

Berkonomics

DECEMBER 12, 2019

If a business were operating above breakeven and revenues and expenses steady, profits would flow to either the shareholders’ pockets or to working capital and taxes. As loan covenants become closer to being violated or after such an event, bankers have some latitude in deciding how to handle their accounts.

Covenant 62

Covenant Revenue Naming Operations 62

Up and Running

NOVEMBER 25, 2020

According to Franchising.com , there are more than 3,000 franchisors operating in the United States currently, and, “an average of 300 new brands start franchising each year.” Most franchisors calculate their royalties and marketing fees as a percentage of gross revenue and require franchisees to pay on a monthly basis.

Covenant 89

Covenant Due Diligence United States Operations 89

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