How early should you connect to a VC? Here's some data. How long does it take from first meeting a VC to getting cash in the bank?
That's an interesting question. Theoretically, someone could meet you, sign your document, and write you a check for deposit that day, but that's not how it usually works. It's also not the best way to create a helpful syndicate of investors that share the founder's vision for the company. Examining the actual data not only gives me some insight into my close process, but it helps me calibrate around relationship building. If all my deals came as intros from trusted connections that I know for years versus at founder pitch events that's interesting data. It also helps me figure out who I should be spending my time with.
In fact, that's what I tend to do--at least, what I say that I do. But does the data play that out? I went back across the 21 investments I've made both at First Round and at Brooklyn Bridge Ventures--a period that dates back to January 28, 2010, when I closed on Backupify. Five months? Steve Blank’s SLL Keynote – It’s a “Must Watch” Watch live video from Startup Lessons Learned on Justin.tv Some of my favorite quote are: Role of the Entrepreneur Your job as an entrepreneur in a startup is to search for a repeatable and scalable business model.
When you find it, your job is to build a company around that business model.Search for a business model rather than write a business plan. Biz model is how a company makes money.Customer and agile development is how you search for a business model.You fail if you stay a startup – goal is to become a large company. Differences Between Startups and Established Companies Startups search and pivot; companies execute.Very different skills needed to execute a business model compared to those needed to search for a business model.Customer development = hypothesis testing, minimum feature sets and pivoting. Want more Steve? Writing a Business Plan. Writing a Business Plan At Sequoia we like business plans that present a lot of information in as few words as possible.
The following business plan format, within 15–20 slides, is all that’s needed... read We like business plans that present a lot of information in as few words as possible. The following business plan format, within 15–20 slides, is all that’s needed. Company purpose Define the company/business in a single declarative sentence. ProblemDescribe the pain of the customer (or the customer’s customer). SolutionDemonstrate your company’s value proposition to make the customer’s life better. Why now Set-up the historical evolution of your category. Market sizeIdentify/profile the customer you cater to. Competition List competitors List competitive advantages Product Product line-up (form factor, functionality, features, architecture, intellectual property). TeamFounders & Management Board of Directors/Board of Advisors See also Elements of Enduring Companies.
Is Your Business Too Sexy to Be Successful? The Wall Street Journal survey of the top 50 VC-backed companies of the year is out.
The #1 company is a provider of VOIP technology for telecom companies. The top 3 companies are all providers of business software to technology or telecom companies. Interestingly, the #1 company last year, a provider of healthcare cost information to consumers, is not even in the list this year. Are consumer-oriented technology businesses too sexy to be successful in today’s market? Everyone wants to be the next Facebook or Google, or even the next Instagram or Pinterest – a company that captures the fancy of consumers and has them signing up in large numbers to use the service.
There’s a flurry of activity in the start-up space, and it’s all good. Does your business even need to be in a startup hotspot to be attractive ? It is sexy to be seen as a Silicon Valley tech start-up that has raised series A funding. Back to the question of location. Enterprise vs. Join the Starter Movement! 7 Lessons Every Startup Should Know. HELSINKI — If you grab a drink with a startup founder, you'll likely hear a few shared stories, both good and ugly, about lessons learned along the way.
Getting a company off the ground is no easy task, especially when looking for funding, but learning from your own missteps (and those made by others) could put you on the path to entrepreneurial success. Startups across northern Europe and Russia met in Helsinki this week for tech startup conference Slush to discuss which trends are surging within the space. Some tips to budding companies are simple ("stay focused" and "think ahead") but hearing cautionary tales and words of wisdom could breathe new perspective into your own approach. Here's a look at what to keep in mind during the early stages of growing a startup from those who have been there before. 1. "It's basically free advice," Wolfrom said. 2. "Don't just look at what's popular in the App Store and see how you can do something along those lines," he said. 3. 4. 5. 6. 7.
Jeff Bezos and the Age of Amazon: Excerpt From ‘The Everything Store’ by Brad Stone. Behind this week’s cover Amazon.com rivals Wal-Mart as a store, Apple as a device maker, and IBM as a data services provider.
It will rake in about $75 billion this year. For his book, Bloomberg Businessweek’s Brad Stone spoke to hundreds of current and former friends of founder Jeff Bezos. In the process, he discovered the poignant story of how Amazon became the Everything Store. Within Amazon.com (AMZN) there’s a certain type of e-mail that elicits waves of panic. When Amazon employees get a Bezos question mark e-mail, they react as though they’ve discovered a ticking bomb. One of the more memorable escalations occurred in late 2010. At Amazon’s Seattle headquarters, Jeff Wilke, the senior vice president for North American retail, Doug Herrington, the vice president for consumables, and Steven Shure, the vice president for worldwide marketing, waited in a conference room until Bezos glided in briskly.
An animated argument followed. Eventually, they compromised. The Dangerous Seduction of the Lifetime Value (LTV) Formula. How to get your first 10 customers. Preface: the assumption for this essay is that you’re building a B2B app, and you have something built but you’re having trouble getting people to pay for it There are three problems with getting your first few customers: You (probably) don’t know how to sell thingsYou don’t know who you’re selling toYou don’t even really know what you’re selling Nobody tells you how to answers these questions, and so most people go out to get initial traction in a haphazard way: They have a vague idea in mind for who wants their productThey’ve already built the product, so they put together a landing page which which, like, totally speaks to the core value propositionThey write some combination of any of the following: A few half-baked ads A few forum posts A few comments on relevant blogs A few blog posts A few cold emails to journalists (because, dude, we would BLOW UP if we could just get ‘Crunched)They send these out into the wild, and (no surprise!)
Were the ads targeted to the wrong keyword? Validation Board - FREE tool for testing startup ideas, stop wasting time and money. 4 Things Most Successful Entrepreneurs Have in Common. Starting a business is always risky, and success is never guaranteed.
Yet, entrepreneurs thrive every day. Although there is no one-size-fits-all approach, successful entrepreneurs seem to share several traits that the rest of the pack lacks. SCORE, a nonprofit organization aimed at helping small businesses, recently released their infographic on what makes today's entrepreneurs successful. To thrive, entrepreneurs need professional experience, a business plan, the right personality and mentors, SCORE found.
Professional experience Professional experience gives entrepreneurs the edge they need to make wise business decisions. A business plan Taking the time to write a business plan not only gives your business direction; it also improves your odds: companies with a business plan see nearly twice the success as those without a business plan, SCORE found. . [8 Free Business Plan Templates for Startups] Positive personality Think you can succeed as an entrepreneur just by being you? A Mentor. 90 Things I've Learned From Founding 4 Technology Companies. On October 27, 2010 I wrote a blog post about the “57 Things I Learned Founding 3 Tech Companies.”
It has been awesome, flattering, and humbling to see that post went viral and has been seen by so many thousands of people — mainly aspiring entrepreneurs — and has been translated into many languages. This past week while I was in Tokyo for meetings with potential partners for Fab, I was invited to participate in a panel discussion on startups. The discussion quickly turned to those 57 things. Amazing. Thousands of miles away and two years later, people still want to talk about those 57 things! So, here goes. 90 Things I’ve Learned Founding 4 Tech Companies: (334) Jimmy Wales's answer to Jimmy Wales: What are the things we can do to get Jimmy Wales to talk to us and work on a startup with us if we have awesome startup ideas. Yaron Galai, Outbrain. It becomes apparent moments into our mid-October meeting near New York's Union Square that digital publishing entrepreneur Yaron Galai stares at his biggest critic in the mirror every morning.
The guy is a voracious and eclectic reader with a serious "completionist" complex: when he picks up an issue of his favorite magazines Wired or The New Yorker, it is with the intent of reading it cover-to-cover. He browses perpetually for new articles and authors (asking me for my own recommendations), and is a huge fan of Instapaper, the app that lets you bookmark articles from anywhere for reading anywhere on the Web or an e-reader. Actually, I wasn't supposed to tell you that, because Galai doesn't want anyone to mess around with such a simple, functional service. That doesn't even account for the books he may be reading in hard copy, on his electronic reader or in Web format – it doesn't matter where, just as long as it is synchronized to the latest page.
IA Ventures - Focus, focus, focus: Understanding your value stack. Distraction and diffuse efforts are killers, especially in nascent businesses. Trying to do too much sucks valuable resources from accomplishing the core mission, but is often viewed as being important for “keeping options open” or “controlling one’s destiny.” The goal of a seed stage company shouldn’t be optionality preservation but laser-focused customer engagement, and to let the market help drive the iterative product development process rather than engineering in a vacuum and trying to solve everyone’s problem.
This is the big issue of developing a general platform versus solving an important pain-point through a vertical application. Platforms can have great capabilities, but it is hard to prove the value without specific use cases. This is why UI is so important even in data-driven API-based start-ups, as potential customers need to actually SEE the value, not merely have it depicted in a spreadsheet or on a series of charts. Know your customer. 17 Incubators & Accelerators to Help Launch Your Big Idea. Does your company need a boost?
Incubators and accelerators can be a great option for any young company or even idea to get off the ground. These programs offer everything from funding, connections with top investors and mentors and collaborative work environments that can last for a few months to a whole year. Y-Combinator Y Combinator runs two three-month funding cycles a year, one from January through March and one from June through August. We ask the founders of each startup we fund to move to the Bay Area for the duration of their cycle, during which we work intensively with them to get the company into the best shape possible. The overall goal of YC is to help startups really take off. Since 2005 we’ve funded over 500 startups. TechStars TechStars is the #1 startup accelerator in the world. We offer six TechStars programs in top startup locations (Boston, Boulder, New York City, Seattle, London, and Cloud in San Antonio), on a regular schedule.
Dreamit Ventures AngelPad Launchpad LA. (315) Startups: How to Communicate Traction to Investors - Posts. Elements of a Strong Business Plan. Napkin Think Force yourself to summarize your idea on the back of a cocktail napkin. Don’t submit your plan until you have this level of clarity. Team Who will occupy the leadership roles in your company, why are they the best players for the task at hand, and how will they go about building an agile, customer-focused culture?
If you believe that an advisory board or governing board will help you grow your dream team, we may be able to help you find the right people. Pain What problem are you trying to solve? Solution Why is your solution superior to competitors, who are the key competitors, what differentiator will propel your solution to break through and achieve broad adoption?
Customer Acquisition Too many early stage businesses fail to fully explain their methods and costs of acquiring customers. Business Model Show us the near and long-term value of a customer, how you earn revenue, and your growth projections over at least a three-year period. Capital Efficiency Financials Final Answer? Words. The Top 10 VC Firms, According To InvestorRank. Any seasoned investor knows that past performance is not indicative of future returns. That is as true with public stocks as it is with venture capital firms. But if someone were to ask you to rank the top VC firms today based on their probability of success, how would you do it? Remember, looking at past returns won’t help you. Chris Farmer, a VC at General Catalyst Partners, has come up with a method which he calls InvestorRank. Just as Google’s PageRank orders search results based on how many links each page gets from other sites, InvestorRank looks at the connections between VC firms.
The more that a VC firm invests in syndicates with other highly ranked firms or even before they do, the higher its InvestorRank. Today at TC Disrupt NYC, Farmer revealed the top 10 VC firms based on InvestorRank. Andreessen HorowitzSequoia CapitalAccelBenchmark CapitalUnion Square VenturesGeneral Catalyst PartnersNEAKleiner PerkinsKhosla VenturesGreylock. Reading Jeff Bezos. A tech friend gives me shit about being a Jeff Bezos fanboy. I’m unabashedly a fan. His 1997 letter to Amazon shareholders is a blueprint for building a durable franchise in technology. I recently compiled and read all of these letters from 1997-2011. Read together, it’s essentially a 15 year narrative of building long-term value in technology and also a history of the Internet and e-commerce.
Here are some random nuggets: Free cash flow was their focus since 1997. I uploaded the printout of these letters here: There are Only Two Ways to Build a $100 Million Company According to This Canadian Superangel. Preparing To Fire an Executive. THE SCIENCE OF SUCCESS: Forget Self-Esteem. 90 Things I've Learned From Founding 4 Technology Companies. 10 Sobering Lessons Learned After Teaching 88 Struggling Entrepreneurs For 6 Months. Startup Equity For Employees. Fred Wilson. Three Leadership Traits that Never Go Out of Style - Vineet Nayar. Build. Measure. Learn. Lean Startup SXSW 2012. by Eric Ries (and 4 others)
Fab.com: Ready, Set, Reset! How To Create A Minimum Viable Product. Lean Startup Lesson: Test Before you Build. A Personal Note On Behance's Growth, Funding, & Progress on the Behance Team Blog. Watch Eric Ries on "The Lean Startup" BREAKING: You Know That TED Talk You Weren't Supposed To See? Here It Is. An entrepreneur’s most powerful tool: the Pyramid Pitch. The 10/20/30 Rule of PowerPoint. How to Deliver a Great Presentation Like Steve Jobs. Startup reporters at TechCrunch, sai, inc, WSJ, NY Times and more. Important Questions Startup Co-Founders Should Ask Each Other. Anatomy of an (un)fundable startup. Rocking Out Your AngelList Profile. Tim Ferriss On How To Start Your Million Dollar Side Business. Before product-market fit, find passion-market fit. Build a Team that Ships.
Reid Hoffman, Permanent Beta and the Startup of You. The Start-Up of You - The Economist Reviews Start-Up of You. You Can’t Know Yourself. So, Create Yourself. Reid Hoffman, LinkedIn - Live Life in Permanent Beta. Ogilvy Notes. Hiphop Lessons on the Game of Business with Ben Horowitz. What They Don't Tell You at Graduation. Class 4 Notes Essay. Beware of MBAs! The business school curriculum teaches how to suck at startups. Startup Founders: Don't Freak Out. If A Big, Awesome Company Wants To Acqui-Hire Your Startup, Say Yes. Acquihires - A Clarification by David Lee. After Two Startup Accelerators, What I Wish Someone Had Told Me.