Startup Professionals Musings

NOVEMBER 6, 2020

It seems that most of you entrepreneurs I meet in my role as business advisor are convinced that starting a new business requires equity investors, exponential growth, and a plan to go public via IPO. With major investors, your equity and return is diluted and delayed. You want to be your own boss, and do things your way.

Small Business 311

Small Business Small Business Administration SBA Equity 311

Startup Lessons Learned

JUNE 15, 2009

As a consumer internet company with millions of customers, it may seem to have little relevancy for an enterprise software company with only a handful of potential customers, or a computer security company whose customers demand a rigorous audit before accepting a new release. No departments The Five Whys for Startups (for Harvard Business R.

Continuous Deployment 167

Continuous Deployment Software Review San Francisco Lean 167

Startup Lessons Learned

AUGUST 24, 2009

The other revels in the world as we all know it will be someday: limitless distribution enabled by new technologies, the importance of collaborative filters, and on-demand availability of all content for end-users. And as everyone’s attention starts to focus on those same indicators, their value is being diluted.

San Francisco 113

San Francisco Lean Technical Review Distribution 113

Babbling VC

OCTOBER 3, 2011

This is very difficult to do if you constantly have to worry about running out of capital in your fund or not having enough reserves to avoid dilution. If IPO's return, you basically will have two to three public markets you can sell into. Hypothesis 9: The problem is on the demand side .

LP 82

LP Europe Germany Venture Capital 82

Tim Keane

JANUARY 12, 2010

Next, they carefully consider the range of multiples being used today to value companies being acquired or doing IPOs in the market that the business is in.   A full ratchet anti-dilution clause is very unfriendly to entrepreneurs; it requires them to make up the entire difference in price from their own holdings.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Both Sides of the Table

JUNE 17, 2017

They hired a biz dev team to work on deals where their product could be embedded in other people’s products as a way to increase customer demand. If there was strong market demand for their product then this investment might pay off handsomely. Stock option grants dilute your ownership in the company.

Stock Options 227

Stock Options Startup Dilution Venture Capital 227

Startup Professionals Musings

DECEMBER 14, 2014

Don’t wait for the harsh reality of the demanding business world to start thinking about these tradeoffs. The downside is loss of control and financial dilution. If you take investor money, expect a push for hockey-stick growth and a liquidity event, like going public (IPO) or sale (M&A), to get the payback.

Hockey Stick 268

Hockey Stick Cofounder Entrepreneur Liquidity Event 268

Startup Professionals Musings

JULY 19, 2013

Don’t wait for the harsh reality of the demanding business world to start thinking about these tradeoffs. The downside is loss of control and financial dilution. If you take investor money, expect a push for hockey-stick growth and a liquidity event, like going public (IPO) or sale (M&A), to get the payback.

Founder 245

Founder Hockey Stick Cofounder Liquidity Event 245

David Teten

JANUARY 19, 2021

From RBI, Flexible VCs borrow the ability to reap meaningful returns without demanding founders build for an exit. The value ascribed by subsequent investors (in a secondary); buyers (acquisition); or the public markets (IPO). Santa Clara University shares their demand dividend structure. . Volatile, uncapped.

Cofounder 78

Cofounder Technical Review Equity Dividend 78

Startup Professionals Musings

AUGUST 10, 2019

Don’t wait for the harsh reality of the demanding business world to start thinking about these tradeoffs. The downside is loss of control and financial dilution. If you take investor money, expect a push for hockey-stick growth and a liquidity event, like going public (IPO) or sale (M&A), to get the payback.

Hockey Stick 243

Hockey Stick Cofounder Liquidity Event Startup 243

Version One Ventures

FEBRUARY 6, 2019

This aggressive ownership target is one reason more and more founders are looking for capital from IT/tech VCs who don’t demand as much equity. With these dynamics at play, I’ve been thinking a lot about how we at Version One can effectively invest in biotech.

Dilution 132

Dilution Artificial Inteligence IPO Valuation 132

Startup Professionals Musings

AUGUST 19, 2017

Don’t wait for the harsh reality of the demanding business world to start thinking about these tradeoffs. The downside is loss of control and financial dilution. If you take investor money, expect a push for hockey-stick growth and a liquidity event, like going public (IPO) or sale (M&A), to get the payback.

Hockey Stick 144

Hockey Stick Cofounder Entrepreneur Liquidity Event 144

The Equity Kicker

APRIL 13, 2012

Throughout our evolution, from privately held start-up to large, publicly listed company, we have managed Google for the long term — enjoying tremendous success as a result, especially since our IPO in 2004. We have protected Google from outside pressures and the temptation to sacrifice future opportunities to meet short-term demands.

Dilution 87

Dilution Stock Government SEC 87

K9 Ventures

OCTOBER 10, 2017

In order for a company to attract a full Seed round ($2M – $3M), that company needs to show an almost completed product, an advanced prototype, or some kind of traction/demand metrics. So the amount of dilution a company will take on still remains the same over the life of the company.

Seed Stage 82

Seed Stage Finance Later Stage Equity 82

Startup Lessons Learned

OCTOBER 26, 2009

Customers kept demanding that we add this or that IM feature, and we were routinely refusing. We were afraid that this was just the tip of the iceberg, and that once we “gave in&# to these five demands there would be five more, ad infinitum. Every time you listen to customers, you fear diluting your vision.

Advisory Board 151

Advisory Board Customer San Francisco Lean 151

www.paulgraham.com

APRIL 28, 2010

In an IPO, it might not merely addexpense, but change the outcome. A lawyer I asked about it said: When the company goes public, the SEC will carefully study all prior issuances of stock by the company and demand that it take immediate action to cure any past violations of securities laws. They just want to invest in this startup.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

abovethecrowd.com

APRIL 20, 2016

The pressures of lofty paper valuations, massive burn rates (and the subsequent need for more cash), and unprecedented low levels of IPOs and M&A, have created a complex and unique circumstance which many Unicorn CEOs and investors are ill-prepared to navigate. In Q1 of 2016 there were zero VC-backed technology IPOs.

IPO 40

IPO Term Sheet Silicon Valley Valuation 40

Ben's Blog

MAY 24, 2021

IPO market. There are a number of trends concerning IPOs and capital formation to note: First, the raw number of IPOs has declined significantly: From 1980-2000, the US averaged roughly 300 IPOs per year; from 2001-2016, the average fell to 108 per year. In the first quarter of 2021 alone, SPACs raised $87.9

SEC 36

SEC Accredited Investor IPO Technical Review 36

YoungUpstarts

APRIL 20, 2012

that caters to a demanding New York clientele. Goldman Sachs and Morgan Stanley lead the IPO market because they are perceived to have reliably procured capital, at the right price, to hundreds of newly listed companies. When you work for everyone, it dilutes your brand. Executives eagerly await his calls and visits.

IPO 154

IPO Initial Public Offering Naming Reputation 154