Venture Capital

Venture capital wants companies that can exit for $100 million or more; they believe that exits of $50 million or $20 million, terrific for a sole proprietor with a Sub-chapter S, wont move the needle or give good ROI (return on investment) to the limited partners, and the arithmetic for this point is solid. So, [...]

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VCs have made the case for standard docs in seed and Series A financings. Isnt there an even stronger argument to be made for standardized option agreements? In a financing, both sides typically have legal representation. (Woe unto the founders if they think their companys lawyers are their personal lawyers, but thats another issue.) In [...]

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PE investors work differently and in it to win it is not something they hide in my experience. Buyout funds, generally called private equity sponsors, have put a lot of thought into their incentive structures and have something that works well for their investing model which is a different model than VC funds in many [...]

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The most important thing is to KNOW your audience. Their learning style, their background, the way they process information. And, of course, the answer is to present the info in the manner that has the highest probability of success. And, to have a backup plan in place. Always a back up plan that anticipates the [...]

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In career-switching into this game its been my #1 head-scratcher. VCs definition of a competitor is often really different from mine. It is critical to prequalify investor meetings. Mostly because if youre operating at a certain level of play, YOU are sharing THEM the gift of YOUR insight into the world. Not to mention the [...]

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Some assume that entrepreneurialism can be taught. I think great entrepreneurs are born or are shaped with determination and drive from early on in their lives. If you are starting a company with $500k only to become partner after a year it means the business has failed or the founder has quit after a year. [...]

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Why would anyone who has the fire in his soul (not his belly, his freakin soul, I have sushi in my belly) to be an entrepreneur want to be a VC? Why would anyone who has the guile in his heart to be a VC (tin cup and all) want to be an entrepreneur? Both [...]

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VCs and other angels would like to see valuations down so they can maximize your profits. Fair enough. If you are the entrepreneur and someone is willing to value you more than another, then it is great. The notion of whether it is a bubble or not is not something the entrepreneur is focussed on [...]

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The record business is a lot like the venture capital business. Both put a lot of capital to work trying to create valuable franchise properties. In both the returns are largely based on a very few hit (companies or bands) carrying a much larger number of investments that dont do well. VC associates are like [...]

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The unwilllingness to sign NDAs, in my view, is a power play and a ego fop by VCs. It is also likely not really very much legal cover as once such an issue is brought up and a VC fails to sign a NDA and ultimately a proceeding of any type is brought the VC [...]

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