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George Deeb is the Managing Partner at Chicago-based Red Rocket Ventures , a startup consulting and financial advisory firm based in Chicago. So, let’s say that one founder puts in $100,000 in seedcapital, that could be worth 20 percent of a seed stage company’s valuation.
It can be very tempting to take in a little bit of seedcapital, and start to operate as if you’re a big company. 2 founders + employee #1), the single employee at the company is a 33% partner in building the company culture and products. Growing Too Fast : This is, I think, the biggest killer of post-funding startups.
What is the best advice you can give for finding a business partner? Don’t quickly choose any business partner. The key is to ask the right people what they think – not your friends, parents or partner. Initial developer: partner or hired? Co-founders are the highest form of dilution to a business. A few nuggets.
If you’re an entrepreneur looking for seedcapital, but don’t know any sophisticated angel investors, you need to hustle and build relationships in order to get “warm” introductions. When will I get my first dividend check?”, Tip #2: If You Don’t Know Any Sophisticated Angels, Hustle and Build Relationships.
I put that in quotations, because, as I’ll expound, there is a start-up industrial complex that is designed to fleece novice founders from their seedcapital with predatory fees, terms, etc. Good accelerators don’t see you as a customer, you’re a partner that they want to help. OK, enough with disclosures. A good policy.
Partner Time. One of the pitches of seed investors is that they have a) the relevant experience needed to really help companies and b) are incentivized to spend more time helping founders than the very large funds. But I’m noticing this value being diluted somewhat for a few reasons. In many cases, this is still true.
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