Both Sides of the Table

APRIL 27, 2014

Seed investors are aplenty and of course they need downstream money to fuel their early-stage bets. I told my friend that I felt that in 2014 too many new VCs feel the pressure to chase deals, to be a part of syndicates with other brand names and to pounce on top of every startup whose numbers are trending up quickly.

Cofounder 374

Cofounder Syndication Syndicate Early Stage 374

David Teten

JANUARY 19, 2021

Yes, via conversion rights at a valuation cap. Yes, via conversion rights at a valuation cap. Seed-stage compatible: Like traditional equity VC investors, Flexible VCs accomodate early-stage investment risk within their portfolios better than a traditional RBI funder. Flexible VC: Compensation-based.

Cofounder 78

Cofounder Technical Review Equity Dividend 78

David Teten

DECEMBER 3, 2019

Data companies focused on early-stage startups include Aingel , fundsUP , Preseries , PredictLeads , and Sploda. The Pocket Negotiator is very early-stage attempt to aid in the negotiating process itself. I have not found a thorough platform for due diligencing all aspects of a potential investment. 7) Negotiate .

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

David Teten

SEPTEMBER 6, 2018

See my summary on how lead investors think about building out their syndicate. . See Beyond the Money: Best Practices of Venture Capitalists in Helping Early-Stage Companies Create Value and It’s the People: Improving Private Equity Portfolio Company Valuations by Working with Operating Executives. 5) Manage deal flow.

Technical Review 60

Technical Review Private Equity Management Cap Table 60

David Teten

SEPTEMBER 6, 2018

See my summary on how lead investors think about building out their syndicate. . See Beyond the Money: Best Practices of Venture Capitalists in Helping Early-Stage Companies Create Value and It’s the People: Improving Private Equity Portfolio Company Valuations by Working with Operating Executives. 5) Manage deal flow.

Technical Review 60

Technical Review Private Equity Management Cap Table 60

David Teten

SEPTEMBER 23, 2017

In venture capital in particular, early-stage companies are often operating in frontier industries, where the rules are unpredictable and conventional analytic frameworks may be misleading. The Pocket Negotiator is very early-stage attempt to aid in the negotiating process itself. . Accompany focuses on this use case.

Private Equity 60

Private Equity Venture Capital Equity Technical Review 60

Gust

OCTOBER 12, 2011

During the summer of 2010, I developed a workshop, A New ACEF Valuation Workshop for Angels and Entrepreneurs. To provide some reference points, I surveyed thirteen angels groups in North American to determine their recent experience in negotiating the pre-money valuation of pre-revenue companies. 2011 Angel Group Valuation Survey.

Angel Groups 125

Angel Groups Valuation Pre-Money Valuation St. Louis 125

View from Seed

AUGUST 20, 2014

If the company is doing really well, the VC will have an incentive to try to do more of the next round at perhaps not the highest possible valuation. Lots of credibility, even at a very early stage. It should be noted however that some angels belong to syndicates that allow them to speak for larger amounts of capital.

Startup 301

Startup Syndicate Syndication Boston 301

View from Seed

JUNE 10, 2020

The dynamics for participation in the next round’s fundraise syndicate is complex, and many accelerators (and VCs) obfuscate their intentions for self-serving interests. We proactively look to build friendly syndicates for our Seed investments, and welcome collaborating to build together.

Cofounder 177

Cofounder Syndication Syndicate Alabama 177

Feld Thoughts

AUGUST 10, 2010

In this case neither Niel (nor I) had any interest in creating a traditional syndicate to fund the company. We did a second financing by ourselves at an increased valuation – this was the “Series B&#. The meat of the funding story follows: “Of course coming up with the idea is the easy part.

Syndication 125

Syndication Syndicate Angel Financing Finance 125

Genuine VC

NOVEMBER 12, 2012

When you compromise on terms in the early stages, you will have to pay the price in the later stages. As a seed stage investor here at NextView seeing our companies progress down fundraising paths, I think it’s extremely important to highlight that terms in early rounds do set precedent for terms going forward.

Finance 128

Finance Mezzanine Valuation Seed Stage 128

Professor VC

APRIL 1, 2010

It had a good mix of viewpoints with east ( James Geshwiler, Common Angels ) and west coast (yours truly) angels, early stage venture capitalist ( Jason Mendelson, Foundry Group ), and a couple of attorneys ( Dan Hansen and Mario Rosati ). It is obviously too late to dial-in to the call, but you can still order a CD of the session.

Term Sheet 32

Term Sheet Angel Investor San Jose Venture Capital 32

Professor VC

JANUARY 17, 2008

One of my comments was that we would likely see more institutionalization of angel groups and syndication of deals among groups. Another comment which probably deserves more discussion is around valuation. He also said they typically only invest at a $1 million pre-money valuation or less. My facebook can beat up your facebook.

Pre-Money Valuation 28

Pre-Money Valuation Angel Investor Angel Groups Valuation 28

View from Seed

JANUARY 26, 2016

With that in mind, let’s look at an illustration of these trends below, which demonstrates what’s been happening to early-stage financing rounds over the last 15 years or so. Series A investors invested quite early, often before product/market fit. Also, the stage of the company tends to be very early.

Seed Stage 120

Seed Stage Early Stage Cofounder Finance 120

Both Sides of the Table

MARCH 6, 2015

*. If you are a 20-something tech entrepreneur you could be forgiven for thinking that seed-stage investors, Angellist Syndicates and widely available angel money always existed. It is, of course, a very recent phenomenon. I was out to raise my first seed money in my second startup of $500,000.

Seed Stage 150

Seed Stage Silicon Valley Syndication Syndicate 150

Feld Thoughts

AUGUST 1, 2018

The $750 million fund combines all of our prior fund strategies – our early stage, early growth, and partner fund investments – into a single fund. For historical reference, our early-stage funds (FG 2007, FG 2010, FG 2013, and FG 2016) are all $225 million in size. We now have seven equal partners.

Syndication 17

Syndication Syndicate IRR Canada 17

Hunter Walker

DECEMBER 21, 2014

17 core investments have been made, I’d say our investment model was, and continues to be, consistent with the type of firm we want to build but if you’re not constantly evaluating how to get better and serve entrepreneurs, you won’t last very long in the early stage venture business. No more, no less.

Cofounder 127

Cofounder Seed Stage Syndicate Syndication 127

David Teten

NOVEMBER 15, 2013

Each new investor tends to raise valuations and lower returns for all the other competitive investors. This is the psychology that drives VCs to load up a company with more capital, rationalizing that $5m at a $20m pre-money valuation is little different than $10m at a $40m pre-money valuation.

Management 114

Management Pre-Money Valuation Venture Capital New Hampshire 114

View from Seed

JUNE 30, 2015

As a founder, I think it’s easier to talk to potential investors about where they invest across the lifecycle of a company (whether it’s truly early-stage/early lifecycle, for instance), versus round stages like seed, series A, etc. Almost all VCs actually invest across this spectrum.

Seed Stage 120

Seed Stage Syndicate Syndication Dilution 120

Feld Thoughts

JULY 14, 2015

Assuming equity is raised at or above that cap, the total dilution, before the new money, is 16.6% (equivalent to an equity financing of $1m at a $6m post money valuation. The term sheet converts all the convertible debt into a post-money valuation of $100, essentially making the convertible debt worthless. Sure – it happens.

Recapitalization 70

Recapitalization Pre-Money Valuation Post-Money Valuation Angel Investor 70

Tim Keane

APRIL 12, 2006

this stage when the company can justify a higher. valuation than the previous round. If the investors ideal size is smaller than your need, you ought to ask about syndication. If they don’t like to syndicate, or don’t have a track record of doing it, you will want to consider your options. How do you approach valuation?

Entrepreneur 60

Entrepreneur Sweat Equity Valuation Common Stock 60

www.paulgraham.com

APRIL 28, 2010

Mechanics Angel investors often syndicate deals, which means they join togetherto invest on the same terms. In a syndicate there is usually a"lead" investor who negotiates the terms with the startup. Dont feel like you have to join a syndicate, though. The valuation determines how much stock you get. million, and youget.05/1.05,

Angel Investor 63

Angel Investor Syndication Syndicate Dilution 63

Both Sides of the Table

FEBRUARY 25, 2010

We were trying to optimize around a few criteria: price, size of round, number of syndicate partners and, of course, terms. million at a $15 million pre-money valuation. Morgan Stanley had proposed a higher valuation to let them in. I’ve offered to fund an early stage company where I promised cash in bank in less than 30 days.

Technical Review 301

Technical Review Term Sheet Due Diligence Venture Capital 301

Rob Go

JANUARY 7, 2013

Amidst the mass of new initiatives, new firms, new strategies, etc that constantly pop up in the early stage investing landscape, it’s helpful to have a clear articulation of what VC’s are focused on and how they see the world. Syndicate Composition: NextView + Seed Funds + Angels: 9. Premium Service: 5. Commerce: 5.

Portfolio 49

Portfolio Seed Stage Cofounder B2B 49

Agile VC

MAY 26, 2011

In another we decended into a debate about our 5 year forecasts (I built the models so fielded most of these questions), and it became clear they probably weren’t the best fit for our Series A round (this group is no longer in the early-stage VC business). It was a pretty good valuation for the time. It was a $4.7M

Term Sheet 178

Term Sheet Silicon Valley Technical Review Social Network 178

Hunter Walker

NOVEMBER 30, 2022

As cofounder of an early stage venture fund myself, I’m here to tell you that while these statements are accurate, they’re also misleading when trying to understand the broad impact these implosions may have upon a firm. Those going to zero have some implicit (if not explicit) impact upon future enthusiasm for the VC firm.

Vertical 48

Vertical LP Syndication Syndicate 48

Feld Thoughts

AUGUST 25, 2015

The key reason for the explosion in capital flowing into the industry, and therefore the large increase in practitioners, had nothing to do with 1970’s performance, early stage investing, or technology. Some were Silicon Valley early stage companies, such as Apple, Quantum, and Masstor Systems.

Venture Capital 70

Venture Capital SBIC Technical Review Silicon Valley 70

Professor VC

JUNE 20, 2011

We managed to pull together an angel syndicate and close $450K on 9/30 after working the phones the last few days and anxiously waiting for signature pages to show up on the fax machine and wire confirms to hit the bank account. offering to invest $75K if we could find another $250K by September 30, 2005.

San Jose 28

San Jose Angel Investor Term Sheet Venture Capital 28

www.paulgraham.com

APRIL 28, 2010

Another concept we need to introduce now is valuation. I say "in theory" because in early stageinvesting, valuations are voodoo. As a company gets more established,its valuation gets closer to an actual market value. As a company gets more established,its valuation gets closer to an actual market value.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

Berkonomics

DECEMBER 17, 2020

Let’s take a few minutes to examine the kind of equity financing available to small or early stage businesses. There are other classes of equity investors for small or early stage businesses that we have not yet considered. Some can supply more when syndicating with other such groups. Friends and family investors.

Equity 62

Equity Finance Liquidity Event Angel Groups 62

Both Sides of the Table

APRIL 3, 2010

Third, he notes that even if they do invest they’re likely to do so at a lower price because you can’t truly get an independent valuation. So if a VC wants to work with really talented early-stage entrepreneurs there are times where they have to be willing to seed fund them in order to be in the deal.

Venture Capital 265

Venture Capital Term Sheet Early Stage Silicon Valley 265

Both Sides of the Table

AUGUST 1, 2010

There is a structural reason that VCs are investing at early stages, 2. Like Brad Feld I’m syndication agnostic but I have a slight preference toward working with others. I’ve written about it myself (Is VC Seed Funding Dead?) and (Is There Really a Signaling Problem with VC Seed Funding?).

Post-Money Valuation 298

Post-Money Valuation Term Sheet Warrant Partner 298

Agile VC

FEBRUARY 28, 2012

Startups in NextView’s portfolio frequently receive inbound interest from other VC investors who are intrigued about what they’re doing, and I often talk with other early-stage entrepreneurs how to approach similar situations. Some folks feel you always should, some feel it’s a waste of time and you never should.

Early Stage 100

Early Stage Syndication Syndicate Silicon Valley 100

Berkonomics

APRIL 3, 2014

There are three classes of equity investors for early stage businesses that we have not yet considered. And even though angel groups syndicate their best deals within their respective associated networks, it is always best to apply to the angel groups nearest your physical location.

Equity 92

Equity Finance Liquidity Event Angel Groups 92

Agile VC

FEBRUARY 9, 2012

There are more similarities with early-stage VC than public investing, but in these asset classes you still see somewhat more uniform access to investment opportunities and less information asymmetry. Also these are typically more mature assets that can be analyzed and understood in broader ways than a de novo startup.

Seed Stage 100

Seed Stage Framework Silicon Valley Early Stage 100

Hippoland

SEPTEMBER 17, 2017

As an early stage investor, I know that if I can invest in a team that fits exactly what Ellen describes (OR MIT / Stanford, OR Facebook / Google, etc), I’ll win in the short term. Just a couple of years ago, AngelList announced their syndicate feature. But syndicates are logistically challenging.

Silicon Valley 48

Silicon Valley Syndication Syndicate Early Stage 48

Hippoland

SEPTEMBER 17, 2017

As an early stage investor, I know that if I can invest in a team that fits exactly what Ellen describes (OR MIT / Stanford, OR Facebook / Google, etc), I’ll win in the short term. Just a couple of years ago, AngelList announced their syndicate feature. But syndicates are logistically challenging.

Silicon Valley 48

Silicon Valley Syndication Syndicate Angel Investor 48