Thoughts on startups by investors that
fund them & entrepreneurs that run them

Category Archives: Starting Your Company

Addressing the Dreaded Lifestyle Outcome

Posted by on May 18th, 2015

Three outcomes dominate exits of angel-funded companies:

Dead bugs – Startups that go out of business, returning less-than-invested capital to angels (usually zero). Positive exits – Companies that liquidate with capital gains to investors, usually via a cash sale to a larger company.  While IPOs are possible, they are very rare for angel-funded companies.  The exits can range from simply

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How to Build a Unicorn From Scratch – and Walk Away with Nothing.

This is a grim fairy tale about a mythical company and its mythical founder. While I concocted this story, I did so by drawing upon my sixteen years of experience as a venture capitalist, plus the fourteen years I spent before that as an entrepreneur.  I’m going to use some pretty simple math and some pretty basic terms to create

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The Discipline of Execution Defines an Entrepreneur

When entrepreneurs come to me with that “million dollar idea,” I have to tell them that an idea alone is really worth nothing. It’s all about the execution, and investors invest in the people who can execute, or even better, have a history of successful execution. Execution is making things happen, and for startups it usually means making change

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10 Incentives for Entrepreneurs to Bootstrap their Startup

I’ve always wondered who started the urban myth that the best way to start a company is to come up with a great idea, then find some professional investors to give you a pot of money to build a company. In my experience, that’s actually the worst way to start, for reasons I will outline here, and also the least common

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Surround Yourself With People Smarter Than You

Helpers do what you say, while good help does what you need, without you saying anything. People who can help you the most are actually smarter than you, at least in their domain. Top entrepreneurs spend more time putting the right team in place to accomplish their objectives than they spend on any other components of their job.

Some entrepreneurs

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The Planned Iteration Startup Launch Minimizes Risk

The traditional mode of starting a company has been to plan a serial process, where you complete once all the steps, leading to the “big bang” launch of the company. I strongly recommend a dramatic departure from this model, called “planned iteration” or Lean Startup methodology, where you assume you won’t get it right the first time, so you launch

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Bootstrapping Organic Growth Makes Startup Sense

When someone asks me for the best way to fund a startup, I always say bootstrap it, meaning fund it yourself and grow organically. Bootstrapping avoids all the cost, pain, and distractions of finding angels or VCs, and allows you to keep control and all your hard-earned equity for yourself. Despite all the focus you hear on external investors, over

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Should I give my seed investors anti-dilution protection?

Original question from Quora: “My team and I are raising our first round for our crowdsourcing website at a $1mm valuation. We have an investor who is interested in purchasing 5% of the company under the condition that his stock will not be diluted at any time. We are considering a counteroffer at twice the valuation considering the anti-dilution provision.

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Who is the most important person in a tech/web startup (visionary, programmer, etc.)?

Since Bill Hewlett joined with Dave Packard in 1939 to create what is today the world’s largest personal computer company, there has arisen an evergreen debate as to who is more important in starting a tech company: the techie or the business guy? Steve Jobs or Steve Wozniak? Bill Gates or Steve Ballmer? Jim Clark or Marc Andreessen?

I propose

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Dread Startup Problems Or Learn To Enjoy Challenges

If you can’t solve problems and enjoy it, you won’t make it as an entrepreneur. By definition, an entrepreneur is the first to undertake a given business, and firsts never happen without problems and people frustrations. The toughest problems are people problems, like personnel issues, but there are tough operational problems as well, such as vendor delays and quality surprises.

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