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Young Entrepreneurs Today's Most Read 9 Proven Ways to Get People to Take You Seriously 4 Intangibles That Drive CEOs What It Takes to Go From Dead Broke to 6 Figures in 6 Months The Mentality of a Successful Career 4 Big Challenges That Startups Face These Siblings Are Cooking Up America's First Meatless Butcher Shop Kim Lachance Shandrow 3 min read News and Articles About Young Entrepreneurs Failure 6 Stories of Super Successes Who Overcame Failure They're perfect examples of why failure should never stop you from following your vision.
Jayson DeMers Podcasts. The Secret of Raising Money. Feld Thoughts. While some people hate the phrase “failing fast”, I find it instructive when it’s used to signify that one isn’t going to pursue a particular path in the context of a larger set of activities.
A few weeks ago, I wrote a post about The Proliferation of Standardized Seed Financing Documents. It generated several hundred email responses and a handful of phone calls. A week or so later, my partner Jason Mendelson wrote a post titled Why There Will Never be a Standard Set of Seed Documents. I’ve concluded that Jason is right so rather than torture myself, I’m failing fast with regard to trying to help create a set of standardized seed documents. Since I received so many private responses to the original post, I thought I’d summarize them here by type of respondent. Lawyers: By far the largest numbers of responses were from lawyers offering to help (thanks!) Entrepreneurs: The next largest number of respondents were entrepreneurs.
VCs: The VC comments came in a few different flavors. Want to Know How VC’s Calculate Valuation Differently from Founders? Back in 1999 when I first raised venture capital I had zero knowledge of what a fair term sheet looked like or how to value my company.
Due to competitive markets we ended up with a pretty good term sheet until we needed to raise money in April 2001 and then we got completely screwed. It was accept the terms or go into bankruptcy so we took the money. Those were the dog days of entrepreneurship. But the truth is that I didn’t really understand just how screwed I was until years later when I finally understood every term in a term sheet and more importantly I understood how each term could actually be used to screw me. Things like “participating preferred stock” in legalese unsurprisingly never actually call out, “hey, this is the participating preferred language.”
Back then VentureHacks didn’t exist. This starts with understanding how VCs and entrepreneurs often see valuation differently. I turned them down. But this example above is all entrepreneur math, not the VC’s.