VC Cafe

JANUARY 29, 2024

2023 was a rough year for Venture Capital and for startups, and it might get even worse. I believe there are a lot of problems need solving, my outlook is longer term and I invest in new companies (most of the startups that Remagine Ventures II will invest in don’t yet exist). In many ways, Edward is right.

Global 171

Global Generative AI Venture Capital Valuation 171

The Equity Kicker

NOVEMBER 20, 2015

Match.com and Square both enjoyed strong first days after their IPOs yesterday. However in the run up to its IPO Square had indicated it would go out at between $11 and $13 per share, and then ended up at $9, and in October last year Square raised $150m at a $6bn valuation.

IPO 60

IPO Matching Ratchet Valuation 60

Growthink Blog

MAY 23, 2011

This combo all too often leads to various forms of deal unpleasantness, like cram-down rounds, liquidation preferences, and change of control provisions, which in turn, often lead to unhappy founders and angel investors even in somewhat successful exits. And they hire very aggressive securities attorneys to represent their interests.

Angel Investor 112

Angel Investor Venture Capital Sweat Equity Cram Down 112

Both Sides of the Table

MARCH 30, 2016

Many had started IPO’ing and we started to think about our future. Investors had grown too used to the idea that any deal you funded would get marked up to a higher valuation in the next round and that’s clearly not always true. Some startups will have a hard time reorienting. forward sales with some as high as 12x sales.

Balance Sheet 150

Balance Sheet Burn Rate Valuation Forecast 150

ithacaVC

FEBRUARY 1, 2018

It is highly typical for a startup to have small investors on its cap table. The treatment of the friends, family and angels (FFA) as the startup matures and raises larger rounds of financing over time is interesting. Startups often get stuck, restart, pivot/change/move, etc., So not very good odds.

Preemptive Right 45

Preemptive Right Cap Table Valuation Dilution 45

www.mattbartus.com

DECEMBER 9, 2012

Perspectives on issues affecting founders, startups and investors from a veteran startup lawyer in Silicon Valley. Interesting strategy, although I don't know if it justifies the added risk of having a flat (or down) round next time you go to raise. Home About Matt Client references Contact. A View from the Valley.

Warrant 40

Warrant Valuation Pre-Money Valuation Term Sheet 40

www.paulgraham.com

APRIL 28, 2010

Want to start a startup? A typical startup goes throughseveral rounds of funding, and at each round you want to take justenough money to reach the speed where you can shift into the nextgear. Few startups get it quite right. In an IPO, it might not merely addexpense, but change the outcome.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

Scalable Startup

OCTOBER 26, 2011

The Second Round, or “B Round”, or “Follow On” round can be the achilles heel of a startup. No doubt the first round of external funding for a startup is usually critical to a startup as it can be the difference between continuing your startup or shutting it down.

Mezzanine 22

Mezzanine Due Diligence IPO Angel Investor 22

abovethecrowd.com

APRIL 20, 2016

In February of last year, Fortune magazine writers Erin Griffith and Dan Primack declared 2015 “ The Age of the Unicorns ” noting — “Fortune counts more than 80 startups that have been valued at $1 billion or more by venture capitalists.” Next came Rolfe Winkler’s deep dive “ Highly Valued Startup Zenefits Runs Into Turbulence. ”

IPO 40

IPO Term Sheet Silicon Valley Valuation 40

Both Sides of the Table

SEPTEMBER 18, 2014

And now I have to explain to team that they’re taking more dilution than they expected if we do a down round. A down round? Lawyers don’t make money on your seed round in any instance. They are investing in your relationship in hopes that you do an A, B and C round. Startup Lessons'

Venture Capital 417

Venture Capital Liquidation Preference Valuation Term Sheet 417

Reid Hoffman

JUNE 8, 2021

As I’m sure most would agree, Airbnb is one of the most iconic startups to have been formed in the world. Airbnb was preparing for an IPO right when the pandemic hit, and everything changed in a matter of days. But I generally am not a fan of committees and things that get in the way of moving quickly in a startup.

Silicon Valley 69

Silicon Valley Hosting Rhode Island Design 69

Scalable Startup

FEBRUARY 1, 2013

The Future of Startups 2013-2017, beginning of a series. Marc Andreesen gave a great interview about a year agi about “The Future of the Enterprise” and where the next startups will be playing – Hadoop, Big Data, BYOD, etc. Some of these next big startups are in L.A., You mean startups? I don’t know.

Software Review 22

Software Review Startup Venture Capital Stock 22

Reid Hoffman

JUNE 8, 2021

As I’m sure most would agree, Airbnb is one of the most iconic startups to have been formed in the world. Airbnb was preparing for an IPO right when the pandemic hit, and everything changed in a matter of days. But I generally am not a fan of committees and things that get in the way of moving quickly in a startup.

Silicon Valley 36

Silicon Valley Hosting Rhode Island Design 36

This is going to be BIG.

AUGUST 21, 2023

In other words, you’re one of dozens, perhaps 100’s of companies getting the same exact e-mail where the VC says they’re really excited about what you’re doing and they work with such and such partner and the firm has done such and such IPOs, etc. That’s why down rounds exist. All they’re doing is filling a database.

Cap Table 78

Cap Table Term Sheet Database Option Pool 78

Feld Thoughts

SEPTEMBER 9, 2015

Some will demonstrate strategically justifiable metrics and have fantastic ‘up round’ exits; others may see liquidation preferences kick in which will negatively impact founders and employees; others may fulfill the adage “IPO is the new down round” , which has been the case for more than half of the public companies on our list.

Liquidation Preference 70

Liquidation Preference Burn Rate Balance Sheet .Net 70

Hippoland

NOVEMBER 13, 2016

It takes a long time to see the results of a startup that does well. So while I’m waiting for my portfolio companies to either die or go IPO, what am I looking at as indicators of success / failure? If a company raises a good round, it gets marked up to the new value. This is necessary but far from perfect.

IRR 48

IRR Valuation Portfolio Due Diligence 48

Both Sides of the Table

OCTOBER 18, 2015

“Trade in an asset at a price that strongly deviates from an asset’s intrinsic value” The arguments against that, “This time the startups have real revenues!” ” In just two years the median round sizes for deals with mutual funds has more than tripled and the same phenomenon holds for hedge funds.

IPO 150

IPO Venture Capital LP SEC 150