Ah… the proverbial hockey stick in a startup’s financial projections. No one believes it, and yet it must be included in any investor pitch. Why? Two reasons. First and foremost, investors are looking for big opportunities, and if the revenue forecasts grow exponentially, that serves as a proxy to claim a large opportunity exists. Second, investors want their money back (and more), and...
Raising money is a sales process, one in which a very small percentage of customers want what you are selling. Following on “If you think it… they will fund“, if you actually want that funding, you’ll need to talk with investors. How many investors??? More than most entrepreneurs think. A conversation with a potential fledgling led to this post. He was frustrated at...
Why does one startup get picked over another for funding? From the entrepreneurs point of view, the answer to that question is often asked in frustration, as they are turned down by yet-another investor, or passed over by yet-another accelerator program. I feel for those entrepreneurs, as I spend most of my life on their side of the table. However, periodically I step over to the other side...
A startup died today. (A thousand other startups died today too, but just as we mourn our own family and friends more than strangers, so we mourn the startups we know more than the masses of others.) In mourning, those of us who knew this company started asking the question, “Why?” Why did this company die? On the surface, the reason is simple. The company ran out of money. No money, no payroll...
If you build it… they will come is an exceedingly common expectation of naïve, first-time entrepreneurs, who have yet to learn the “real world” difficulties of finding and selling to customers. Similarly, for funding first-time startups too often entrepreneurs expect a good idea and 80 page business plan is sufficient for an investor to invest. I call this erroneous expectation, If you think it…...
Sometimes others take the words right out of my mouth…
Last week, blogger Michael S. Malone asked the question, What is “The Purpose of Silicon Valley“? Seems quite a pertinent question to those of us who have left the world of tech to embrace the world of conscious companies, where our startups are truly changing the world.
Read the whole story on MIT’s Technology Review.
Nobel prizes have been awarded for the idea that the market is rational. Clearly, none of those economists or award judges have ever dealt with early-stage private equity, a.k.a. startup investing. That is the most obscenely irrational, inefficient market that I’ve ever dealt with. In that market, I wear multiple hats, and sit on all sides of the table. I’m a professional investor as at Fledge...
It is application season once again at Fledge, and with it, dozens of repeats of a very common first-time entrepreneurial mistake. A grand vision with multiple components, which as a whole, all implemented, all popular, would solve some problem or simply make people’s lives better. To the ears of the entrepreneur, it sounds wonderful. To anyone who doesn’t review hundreds of business plans each...
The selection criteria at Fledge, the conscious company accelerator are easy to explain. 1) Team, 2) Impact, and 3) Odds of success. The subtleties within each of these concepts and the whole selection process takes a bit more explanation: 1. Team Unlike most of the other accelerators focused on social good, Fledge is behind the scenes, a for-profit impact investment fund. We invest in every...
In a Day in the Life, the Beatles tell us, “now they know how many holes it takes to fill the Albert Hall”. In the day in the life of the entrepreneur, who is there to say how many holes there are yet to fill? A few times last week, I was questioned as to why anyone needs a business accelerator vs. following in the path I took, learning the trade “in the streets” by...
