How Do You Prepare A Cash Flow Forecast?
Before I launched my startup, I built an elaborate Excel spreadsheet to forecast how our company would grow. The spreadsheet had tabs for headcount, revenue by product, gross margin, rent, and cashflow. At the heart of the model, was the product revenue model. Since we were launching multiple products per year, this was the most…
10 Mistakes That Will Kill Your Investor Pitch
I watched the CEO start his pitch, and, within 10 seconds, I knew he wasn’t going to get the partnership’s funding. You see, the CEO had committed one of the 10 mistakes that will kill your investor pitch. Raising angel funding or venture capital funding is hard. So, the last thing you want to do…
How Do You Fire Your Co-Founder?
I was on edge. I couldn’t sleep. I hated going to the office. That’s how I felt before I took the necessary step of firing my co-founder. Unfortunately, over 50% of co-founder conflicts can not be resolved. I’ve built several businesses to greater than $100 million/year in revenue. And, I’ve helped many startup CEOs successfully…
How Do You Build An Innovative Startup?
James Carville, Bill Clinton’s chief strategist when Clinton ran for president in 1992 famously described their pitch to voters in one simple phrase, “It’s the economy, stupid.” Clinton and Carville’s relentless focus on the economy. Clinton’s opponent, President George Bush, didn’t focus on the economy and he paid the price, losing to Clinton. If you…
How Should You Manage Your Stock Option Plan?
“I was expecting an offer of three percent,” Joe said to me. I’d been recruiting Joe since before we got our funding, and, now, two years after we closed our funding, we had offered Joe 0.75% stock options to become a Senior Scientist. Joe had a PhD from Stanford, and the engineering team thought he’d…
The 5 Reasons Why So Many Startups Fail
There are a lot of studies you can find online that will give you the, alleged, data on why so many startups fail. The problem is the reasons cited are superficial at best. I’ve built several businesses to greater than $100 million/year in revenue. And, I’ve helped many startup CEOs successfully build their businesses. I’ve…
What Should You Look For In A Mentor?
“I want you to meet with Dave,” Mike, the managing partner of the VC fund I was interviewing at to be an Entrepreneur in Residence (EIR) said. “He does most of our semiconductor investments, so it’s important for the two of you to meet.” I was finishing up a long day of meeting with the…
Do You Really Need A Board Of Advisors?
I remember when I started my company I thought I needed a board of advisors. After all, every other startup company that I looked at had an impressive list of advisors on their website. I thought, “this must be one of the keys to raising money. I’d better find my group of advisors.” So, I…
How Much Equity Should You Give Investors?
When you’re an entrepreneur raising money for your startup from angel investors or venture capitalists, the question that’s on your mind is, “How much equity should you give your investors?” It’s a tough question to answer because angel investors and venture capitalists negotiate term sheets every day and you don’t. I’ve raised over $100 million…
What’s The Right Way To Determine Your Team’s Salary?
I’ll never forget one of my investors, “Raul”, asking me how much I was going to pay myself after we closed our $12 million round of funding. I told Raul I was going to pay myself $200,000, well below the market rate of $250,000 at the time. This was significantly more than the zero salary…