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We are the leader in the professional domain with viral growth. What I knew that many didn’t was that a combination of curiosity and a viral game mechanic would slowly get to a million people, at which point the network becomes valuable. We didn’t try to establish the viral dynamic; we just asserted it.
What is your viral coefficient? Look for Your LeadInvestor. First you’ll want to find a leadinvestor — someone many other investors will recognize and respect. This list of top angel investors is a good start. viral video. Focus on traction. Resist the urge to send out a blast.
Leadinvestors and follow investors can both win equally but in each case you know why you personally are writing the check. They have real stories about what drives user engagement and viral adoption. I like to be early – usually first or near enough to it. Access to Deal Flow. Domain Knowledge.
This is a variation on the first mover argument, implying a paradigm shift that gives you a tremendous lead. Investors will suspect you have a technology looking for a solution. This advantage is not sustainable. Our product is truly disruptive technology.” Only our team can make this work.” Our patent will protect us.”
This is a variation on the first mover argument, implying a paradigm shift that gives you a tremendous lead. Investors will suspect you have a technology looking for a solution. This advantage is not sustainable. Our product is truly disruptive technology.” Only our team can make this work.” Our patent will protect us.”
Aside from the early commitments, the next most important thing to focus on is nailing down your leadinvestor. I’ve found that the leadinvestor will end up doing 90% of the work for a startup (or will cause 90% of the pain if you get the decision wrong). Often one of the leads in the mix is a larger, multi-stage fund.
These business would scale on the sheer virality of their communities. Running around Europe trying to find leadinvestors for these businesses was priority number 1. In the case of these two companies, I clearly picked the wrong product. We overlooked doing extensive market research. I should of cut the cord much earlier.
Viral coefficient (how well your users become your marketers.). Marketers optimizing campaigns to generate traffic and leads. Investors , when we’re trying to raise money. Traffic sources and campaign effectiveness (the SEO stuff, measuring how well you get attention.). What makes a good metric?
Vision for B2C, virality-driven community. Regarding structure, the first deal is a rolling round with committed leadinvestors. Highly experienced, top-tier angels. Vision for B2B, sales-driven technology. Requires team relocation. First-time VCs, building on their own entrepreneurial success. Conveniently local. Looks good.
You don’t want to have to go into witness protection just because you couldn’t get your app to go viral.) (Morality aside, I’d say given the inherent riskiness of startups, I’m not sure this would be a great addition to your cap table. If prospective employees didn’t do this kind of research before, they almost certainly will now.
I think I took the first two or three meetings with Fred's leadinvestor, which is pretty funny. Eric Ries : So, what was the investor reaction like? I basically just started setting up meetings, taking first calls, and pitching people on why they should invest in Fred. Nobody batted their eyelids too much.
This is a variation on the first mover argument, implying a paradigm shift that gives you a tremendous lead. Investors will suspect you have a technology looking for a solution. This advantage is not sustainable. Our product is truly disruptive technology.” Our patent will protect us.”
Vision for B2C, virality-driven community. Regarding structure, the first deal is a rolling round with committed leadinvestors. Highly experienced, top-tier angels. Vision for B2B, sales-driven technology. Requires team relocation. First-time VCs, building on their own entrepreneurial success. Conveniently local. Looks good.
Earlier this week, in the wake of Y Combinator’s Demo Day, I saw a tweet go viral and generate lots of chatter. His tweet reads: New weak investor move. The tweet was written by YC’s President, Michael Seibel. Most of the rounds I participate in today are priced equity rounds.
This is one of the reasons why the best practice for a startup is to raise investment rounds from different leadinvestors rather than simply doing internal rounds, even if an internal round requires less work. One of the things a financing round brings is an opportunity to strengthen the startup’s overall network.
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