Top Startup Fundraising Mistakes to Avoid

This guest post was contributed by BJ Lackland, CEO of Lighter Capital. Raising money for your startup can be a 40 hour per week job—one you have to do in addition to the work-a-day job of managing and growing your company. Raising money is difficult for even the most promising companies out there, so it pays, literally, to avoid common fundraising pitfalls. Here are four rookie fundraising errors you’ll want to be sure to sidestep when you start your next round of fundraising. 1. Not showing investors your value. When you first pitch investors, you need to establish two critical things at the beginning: 1. That your business model is viable. 2. That you’re well-positioned to grow fast. Have some key metrics at your fingertips, such as year-over-year revenue growth, gross margin, number of customers, customer acquisition cost (CAC) plus lifetime value, and projections for the next couple of years. These …
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What Are We Talking About When We Talk Valuation?

Valuation is one of those ubiquitous words: at least when it comes to discussions around startups — and, of course, stock market multiples. But it can be confusing because there is not just one type. In fact, there are several types of valuations and they come into play at different times in a company’s lifecycle. For example, there are the private company valuation figures that get bandied about: think the numbers people reference for Uber and AirBnB for example. And there are public market valuations for where stocks trade now and predictions for what they’ll be worth in the future. And then there are 409A valuations. Below I’ll walk through the key differences between business valuations and startup valuations. 1. Business valuations = the price of the company. They are calculated based on: Cash flows (current and projected) The value of physical and intangible assets The existence of readily identifiable …
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How Entrepreneurship And Angel Investing Remove Barriers For Women

This guest post by Geri Stengel was originally published on Forbes. Opportunities are growing for women to sidestep the glass ceiling and steer clear of the glass cliff, that corporate “opportunity” for leadership given to women and minorities when there is high risk of failure due to a crisis created by former leaders or because needed resources aren’t given. The opportunities come from the ever-growing awareness among angel investors that women-led startups are good investments. And the awareness among women that entrepreneurship gives them control of their own destinies. No more cleaning up other people’s messes, just a great opportunity to strut your stuff while building your own wealth and the economy. High-growth companies market innovative technologies, products, and business models. They also create jobs. Starting businesses has its risks: 50% of small businesses fail within their first five years. But with job security a thing of the past, controlling …
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Cannabis Startups: Exploring the Opportunities and Challenges

EGFS’ first-ever panel event for cannabis entrepreneurs attracted 100 participants. The speakers were: Ambere St. Denis of Crimson Business Insurance; David Ehrenberg, CEO of EGFS; David Kram, Founder and CEO, Relieve; Evan Horowitz, Cofounder of Weed Club; Brian Holmes, Managing Director at First Ascent Associates; Tucker Cottingham, Attorney at Bend Law Group; and moderator Gina Cooper, CEO of Cooper Strategies. I cover the highlights below. Also stay tuned for the video of the session on an upcoming episode of ABC Family’s Startup U: What cannabis businesses need to know about getting insurance: Carriers exclude many types of coverage and apply strict definitions to events that are covered. For example, armed robbery is a big risk for cannabis companies, but insurers typically exclude it from coverage. In the same vein, be sure you know what the difference is in your insurer’s definition of robbery versus burglary. And beware of not conforming …
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Early Growth Financial Services Adds New CFOs to Key West Coast Markets

Originally published on PRWeb. National outsourced financial services firm EGFS announces addition of three new CFOs to West Coast operations. San Francisco, CA (PRWEB) June 24, 2015 Early Growth Financial Services (EGFS), an accounting and financial services firm that offers an extensive range of outsourced financial support to early-stage companies, announces the hirings of David Horning, Jerry Saenz, and Perry Panchmatia. In the San Francisco Bay Area, David Horning brings multifaceted expertise to bear from his years working as an independent CFO helping technology-focused companies in the areas of financial forecasting, strategic planning, and risk management as well as time spent as an investment professional at a Palo Alto based investment firm where he invested in both public companies and private VC-funded startups. Prior to his joining EGFS, Horning’s consulting clients included a number of Bay Area startups. In this role he helped with equity and debt financings, budgeting and …
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Eight Ways to ID New Market Opportunities

Originally published in Bplans. The Young Entrepreneur Council (YEC), an invitation-only organization comprised of the world’s most promising young entrepreneurs, asked eight of its members for their best advice on identifying new business opportunities. Here are their answers. 1. Use Google Trends Google Trends is a tool that lets you see how the number of searches for a given term has changed over time. It’s an invaluable tool for getting a clear sense of the evolution of a trend or market. Tip: Put in a variety of search terms to see their relative popularity. — Emerson Spartz, Spartz 2. Spot Signifiers To understand your marketplace, you need to make sure that you have a good understanding of past trends, how and why they occurred. This knowledge will give you the insight you need to spot signifiers and indicators of new trends. — David Ehrenberg, Early Growth Financial Services 3. Read …
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The Singularity Is…Here

“A technological singularity is a fundamental change in the nature of human civilization, technology, and application of intelligence, to the point where the state of the culture is completely unpredictable to humans existing prior to the change.” —Siri There has been and there is still a lot of heated debate, with partisans lined up on both sides, and many competing claims surrounding singularity: what it means, when it might happen, and what the implications are. My view is that we will reach a “crossover” point of human versus computer intelligence. But first, I’d like to step back and explain how I frame this and why I don’t think anyone can say with certainty when that point might be. I definitely don’t believe the “it’s right around the corner” crowd. It also seems simplistic to try to pin down a date: whether that’s Kurzweil’s 2045 prediction or some other fixed date …
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5 Ways to Convey Your Passion to Potential Investors

This guest post was contributed by BJ Lackland, CEO of Lighter Capital. Fundraising can be an arduous and time-consuming process for entrepreneurs. To survive this process, it’s critical that you stay focused on what you’re passionate about. What drove you to launch your company? Perhaps it was the lure of financial independence. Or perhaps it was a desire to be your own boss and have a flexible schedule. While these may have played supporting roles in the decision to start your company, most likely the key driving force was this: a burning passion for the problem you’re solving. When you were first starting out, that passion gave you the energy and courage to be an entrepreneur: driving you to create, build, and delight your customers. But over time, did your passion get masked during the day-to-day grind of startup life and in the challenges involved with fundraising? Don’t let that happen! …
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How Do Angel Investors Make Decisions?

In some ways, getting your startup funded has parallels with The Amazing Race. It can seem like a long, winding, obstacle-strewn course. Kevin Smith of SEEDCHANGE shared his insights with us on what it takes to hook angel investors. Profile of a typical angel investor Middle-aged Well-educated Previous career in technology, finance, or law $50,000-$100,000 to invest in a deal Kinds of companies angels invest in Angels typically look at several dozen startups a year, but given the size of their investment, they usually focus on early-stage tech startups mostly in the areas of cleantech, technology, and fintech. They are interested in whether or not your business solves a problem. In terms of investing criteria, they also want to get a read on the quality of your management team including: backgrounds, domain expertise, track record, and how cohesive you are. They’ll want to know what’s unique about your IP and …
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