View from Seed

FEBRUARY 26, 2020

In previous blog posts I’ve written about the two main approaches to building a seed round syndicate – the subscription method (where an entrepreneur presets a structure with a convertible note or SAFE and recruits investors who subscribe to the round, all without a term-driving lead investor) and a term-driving lead investor approach.

Syndicate 257

Syndicate Syndication Lead Investor Venture Capital 257

View from Seed

FEBRUARY 23, 2021

At this point, the investor and the entrepreneur work together to develop their perfect list of potential partners, and then do targeted outreach to try to bring this investor into the round. The average investor is fairly harmless, and even if they aren’t as helpful as one would hope, they rarely create major headaches.

Syndicate 207

Syndicate Syndication Term Sheet Cofounder 207

View from Seed

SEPTEMBER 23, 2019

To provide relevant perspective, listing past convertible note(s) and/or equity financing(s) including total round size and valuation (caps) is helpful. Also, sharing some flavor (but not necessarily full detailed specifics) of the existing investor-set adds context. What not to include is directly stating valuation expectations.

Cap Table 211

Cap Table Seed Stage Valuation Dilution 211

Both Sides of the Table

DECEMBER 18, 2009

The first came from the CEO of iScraper telling me that they would not be able to complete the deal – their investor, Apax Partners, had decided not to proceed despite verbal assurances that they would. At BuildOnline we had brought one new investor to the deal – a Swiss/New York investor called ETF Group.

Germany 298

Germany Entrepreneur Merger Los Angeles 298

View from Seed

FEBRUARY 12, 2020

I notice some founders (from YC in particular) have been trained to say something like: “we are just starting the process, but things are moving faster than we expect and we are already scheduling follow-up conversations and partner meetings.”. Some founders lay out a specific time frame for when they hope to get the round closed.

Term Sheet 364

Term Sheet Burn Rate Founder Partner 364

David Teten

JANUARY 10, 2012

With a unique vision for starting and successfully managing innovative companies, he is the Managing Partner of Social Leverage, a holding company that invests in early stage web businesses. He holds a Master of Science in Finance from the London Business School and a Bachelor of Arts from Tulane University.

Technical Review 128

Technical Review Technology North Carolina Switzerland 128

David Teten

SEPTEMBER 5, 2014

Like many established finance & media companies, GLG knows that the tech startup sector is a growing part of the economy. Today our clients include major corporations, consulting and law firms, and nonprofits, in addition to investors, and we connect them to experts in every field, from everywhere around the world.

New York 114

New York Technical Review Networking Advisory Board 114

reidhoffman.org

NOVEMBER 12, 2013

× At Greylock , my partners and I are driven by one guiding mission: always help entrepreneurs. Investors see a lot of pitches. In a single year, the classic general partner in a venture firm is exposed to around 5,000 pitches; decides to look more closely at 600 to 800 of them; and ends up doing between 0 and 2 deals.

Entrepreneur 111

Entrepreneur Viral Revenue Networking 111

The Next Web

OCTOBER 7, 2013

In a CTO Salary and Equity trends report by Safire Partners, it finds non-founder equity compensation to settle out below 2 percent. As stated earlier, investors will dilute ownership upon nearly every round of financing. percent to 3 percent range for engineer #1s.

Engineer 129

Engineer Dilution Option Pool Vesting 129

This is going to be BIG.

FEBRUARY 27, 2011

You get dilution sensitive and you start optimizing on price of a financing deal, versus finding the right partners or raising enough money to grow. The right lead investor and the right amount of cushion in a raise can help with the best defense against scaling disaster—hiring.

Dilution 104

Dilution Equity Hiring Partner 104

View from Seed

OCTOBER 21, 2014

Sharing these pricing expectations early with potential lead investors fundamentally qualifies your conversations, but it also runs the risk of prematurely losing a potential financing partner, or else it can reduce options to maximize your fundraise outcome. Market Value.

Valuation 336

Valuation Founder Seed Stage Angel Investor 336

View from Seed

JANUARY 11, 2021

Kent Bennett from Bessemer Venture Partners spoke to this initial slow down: “ We couldn’t do anything until we understood the new normal. We looked to who from our respected community could help us meet founders, partnered closely with co-investors we’d worked with before and with credible angels.”.

Venture Capital 350

Venture Capital Cofounder Early Stage Seed Stage 350

mashable.com

NOVEMBER 2, 2011

Look for Your Lead Investor. First you’ll want to find a lead investor — someone many other investors will recognize and respect. This list of top angel investors is a good start. Thanks to Mashable’s Supporting Event Partners. Money and Finance Lists. Global Syndication Partners.

Social Media 80

Social Media Startup Angel Investor RSS 80

Hunter Walker

JANUARY 10, 2022

Homebrew was on the board of a construction tech startup called BuildingConnected , having led their seed financing. and we also had a great relationship with the partner. I can’t say we have major regrets here though — Susa has been a great partner. The needs of the lead investor for ownership?

Cofounder 93

Cofounder Founder Acquisition Startup 93

Genuine VC

JULY 10, 2012

There are essentially two distinct basic strategies for startup entrepreneurs to raise a seed round of capital: Subscription approach – An entrepreneur sets a structure (usually a convertible note) and recruits individual angel investors who subscribe to the round, all without a term-driving lead investor.

Syndicate 207

Syndicate Syndication Seed Stage Portfolio 207

Pascal's View

JULY 9, 2017

At its core, this issue points to the lack of understanding about the importance of post-money valuation by both entrepreneurs and investors. When it comes time to convert the notes, these entrepreneurs face ‘sticker shock’ about their post-financing ownership.

Post-Money Valuation 49

Post-Money Valuation Valuation Cap Table Covenant 49

Genuine VC

JULY 30, 2012

By communicating pricing expectations with potential lead investors, I mean sharing either an “ask” or even stated floor for the pre-money valuation of the company (with a priced preferred round) or explicitly stating a valuation cap (for convertible note round). It’s like opening a job interview by sharing salary requirements.

Valuation 136

Valuation Pre-Money Valuation Angel Investor Syndicate 136

The Startup Magazine

AUGUST 18, 2017

The opening keynote session will define directions on Aligning the Role of Government Policymakers, Incumbent Banks, FinTech Innovators, Investors, Multilateral Agencies, MNOs and the Private Sector to Create a Dynamic Ecosystem for FinTech in Africa.

Africa 61

Africa Ethiopia Elevator Pitch Technical Review 61

Steve Blank

FEBRUARY 3, 2011

We were just about to have a board meeting in another week to talk about raising another round of financing to keep our struggling disaster afloat. Steve, we thought we’d tell you this before the board meeting, but both our firms are going to pass on leading your next round.” Our board meetings were collegial and often fun.

San Francisco 333

San Francisco Silicon Valley Limited Partner Venture Capital 333

Feld Thoughts

AUGUST 2, 2010

This prompted me to write a post titled AngelList Boulder and Some Thoughts on Seed Investing where I promised to write up some of my thoughts on how and why VCs could be good seed investors. They are: Fred Wilson: Lead Investors, Dipshit Companies, and Funding Every Entrepreneur. Tags: Seed Financing seed VC.

Angel Investor 152

Angel Investor Cofounder Syndicate Syndication 152

Austin Startup

MAY 8, 2012

Silverton Partners was the lead investor and is joined by a group of new venture and corporate investors including Webb Investment Network, the investment fund of former eBay COO Maynard Webb, and several private investors including Asana executive Kenny Van Zant; bringing total financing to $4.1M.

Lead Investor 67

Lead Investor Analytics Cloud Finance 67

VC Adventure

MAY 21, 2014

A few months ago AngelList announced Syndicates - enabling investors on AngelList to create fund-like groups of investors to invest together in AngelList companies (following a single lead investor). 506(b) vs 506(c): These refer to two of the SEC rules that regulate “crowdfunding” financing.

Syndicate 93

Syndicate Syndication Technical Review Due Diligence 93

Both Sides of the Table

MAY 13, 2018

If you’re raising a round where a new lead investor would invest $5 million the VC fund must have no less than $100 million and if you’re looking for them to write $15–20 million as the lead their fund realistically should be at least $400 million. It doesn’t have to be a partner?—?every Plan accordingly.

Term Sheet 332

Term Sheet Due Diligence Campaign Sales 332

Both Sides of the Table

MARCH 6, 2011

I still think it’s best to take money from Dave when you’re also partnered with a more focused, hands-on seed-stage VC who brings different things to the table – like more ability to write larger checks in a downturn (for one) or solving a deep crisis that involves super hands-on involvement.

Valuation 292

Valuation Deal Flow Lead Investor Cofounder 292

Both Sides of the Table

AUGUST 1, 2010

Many (Union Square Ventures, Foundry Group, True Ventures, GRP Partners, Mike Hirshland at Polaris Ventures) do it the right way – we treat it as a normal investment and we don’t have a “options&# strategy with our investment. In these cases we proactively offer to lead their next round of financing.

Post-Money Valuation 298

Post-Money Valuation Term Sheet Warrant Partner 298

Growthink Blog

MAY 3, 2010

Typically a Series B financing event will raise $5 to $10 million for the company. million Series B financing round - this is the biggest Series B round I've seen in a long time. There is a ton of financing waiting for the right companies. So yes, even in this economy, venture capital financing IS readily available.

LP 71

LP Venture Capital Syndicate Syndication 71

Hunter Walker

APRIL 4, 2015

With Homebrew we’re focused on being ‘partners of conviction’ to founders during the first few years of their companies. Here’s what we’ve observed and how we currently think of these rounds. Heading into Homebrew II, Satya and I are still discussing our framework for evaluating these opportunities.

Cofounder 48

Cofounder Lead Investor Valuation Framework 48

Babbling VC

DECEMBER 5, 2010

Co-Investors. Technically, co-investors would fall under the "People" heading above but here I'm focussing more on the funds themselves and not specific partners or people at that fund. . We picked the investor who was far better known in the market and supposedly had reach into the US. The other didn't and died! .

Technical Review 76

Technical Review Europe Portfolio Germany 76

Feld Thoughts

JUNE 2, 2010

I wasn’t able to make it to Boston yesterday for the Angel Boot Camp as I was running around NYC with the CEO of a company I invested in last week introducing him to a bunch of potential customers and partners. My long time friend and co-angel investor Will Herman wrote a post titled Angel Investing that summarized some of his advice.

Angel Investor 167

Angel Investor Boston Due Diligence Cofounder 167

Austin Startup

OCTOBER 13, 2010

StoredIQ , a leading provider of Intelligent Information Management solutions for eDiscovery, records and compliance management, today announced that it has closed $10 million in new investment financing and expanded its management team in preparation for accelerated growth. CrunchBase Information. S3 Ventures.

Vertical 59

Vertical Early Stage Cofounder Channel 59

Reid Hoffman

JANUARY 26, 2021

One of the things a financing round brings is an opportunity to strengthen the startup’s overall network. This is one of the reasons why the best practice for a startup is to raise investment rounds from different lead investors rather than simply doing internal rounds, even if an internal round requires less work.

Startup 36

Startup Equity Early Stage Green 36

Agile VC

JANUARY 12, 2012

When a startup doesn’t match the stage where a particular investor focuses, founders may get a response along the lines of “This is interesting to us, but come back once you get from X phase to Y phase” That could be from seed stage to a larger Series A financing need, or to progress from pre-product to post-revenue.

Seed Stage 100

Seed Stage Silicon Valley Syndicate Syndication 100

VC Adventure

MAY 21, 2014

A few months ago AngelList announced Syndicates – enabling investors on AngelList to create fund-like groups of investors to invest together in AngelList companies (following a single lead investor). 506(b) vs 506(c): These refer to two of the SEC rules that regulate “crowdfunding” financing.

Syndicate 48

Syndicate Syndication Technical Review Due Diligence 48

Rob Go

AUGUST 9, 2016

Think of it this way, an investor may invest in 1-3 deals a year, and build a portfolio of 7-12 active companies that they are point on at any given time. Entrepreneurs are typically only choosing one lead investor and board member per round. How did this investor react and how did they help? But often, it is not.

Term Sheet 28

Term Sheet Due Diligence Lead Investor Portfolio 28

Professor VC

JANUARY 20, 2009

The latest statistics from VentureSource show 554 financings in Q4, down from 620 in Q3 and 718 in Q4 2007. On that front, I take pride in the second headline with news that Fliqz , where I am CFO, just closed on $6 million in Series C financing. Labels: bootstrapping , CFO , Fliqz , venture capital , venture financing.

Venture Capital 28

Venture Capital Silicon Valley San Jose Bootstrapping 28

Both Sides of the Table

SEPTEMBER 23, 2010

Asked to respond to the topic, “What collusion happens with AngelList, if any&# I wrote the following: “Um, let’s not be naive here and not think that a “form of collusion&# doesn’t happen on virtually any financing round. Investors talk to each other. How well financed is the competition?

Entrepreneur 292

Entrepreneur Technical Review Valuation Stealth 292

www.xconomy.com

JUNE 9, 2012

Managing Director, Enterprise Partners. In fact, by using analytics software that relies on a different way of measuring risk, the San Diego firm is becoming known in some circles as “the Moneyball of venture capital,” according to David Coats, a co-founder and managing partner. President and CEO, Complete Genomics. Dan'l Lewin.

San Diego 40

San Diego Venture Capital Technical Review San Francisco 40