It’s no secret that venture capital is in a tough spot right now. For startups feeling that pinch—you’re not alone. But there are things you can do to get through this tight period while you hunt for your perfect investor. I recently read this Forbes article about 5 things you can do to get through a dry VC funding market. Those tips are as follows: 1. Cut expenses where you can to protect your bottom line until you get through to the other side. 2. Revise your business plan to account for this slump—you may have to move your goals back a few years. 3. Keep networking and stay in touch with existing investors so that you remain at the top of their list when they open their checkbooks. 4. Consider investments outside of venture capital—like crowdfunding, angel investors, venture debt, and others. 5. Think Out of the Box! Consider a merger to get big enough that VCs might consider investing. I’ll link the article below so you can read more, but first… These are decisions that no business leader likes to take, but it’s all about ensuring your startup’s survival until the market clears up. With that being said, the last piece of advice offered, which is to “roll up” and merge with other startups to increase your likelihood of success, made me raise an eyebrow when I read it. This strategy can work if it is in line with your goals. But keep in mind that this could mean diluting your control of the company, adding extra variables to your market decisions, and potentially stretching your resources even thinner in the meantime. Suffice to say, it is very much not a decision I would recommend making on a whim. If you’d like to talk through the strategy behind a merger, you can connect with me any time here: https://buff.ly/4asCxPE And to read more about what you can do to survive the dry VC market, check out the Forbes article here: https://buff.ly/44Sa6ZU #MatthewGlickLegalServices #StartupAttorney #CorporateAttorney #TechStartupLawyer #DealFramework #BusinessNegotiation #LegalTerms #VentureCapital #VC #Investments #Mergers #Forbes
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Visionary Marketing Leader | Expert in Brand Strategy & Revenue Growth | Transforming Companies into Market Leaders
💰 Startup Equity Dilution Calculator 💰 Play around with the numbers. Each new funding round dilutes the ownership. Initially, a founder or co-founders each hold complete ownership of the startup, with a single founder possessing 100% or each co-founder owning an equal share of 50%. As new investors join the rounds, the ownership gets diluted. Remember, the more equity you give up, the less control you will have over your company. BUT, running out of cash/ failing to raise new capital is the #1 reason why startups fail. In the rush to get those much-needed funds, founders sometimes skip over the analysis of how each round of dilution will impact the next rounds. When you are exiting with a company valued at let's stay $100 Million, having a 5% and a 6% ownership translates into a significant financial disparity. 7 situations where typically startup dilution occurs: 1️⃣ Series A and Other Funding Rounds 2️⃣ Initial Public Offering 3️⃣ Mergers and Acquisitions 4️⃣Secondary Offerings 5️⃣ Employee Stock Options 6️⃣ Convertible Securities 7️⃣ Creation or Expansion of Employee Stock Option Pools Here is a calculator by Cake Equity to help with those calculations regarding dilution: https://lnkd.in/grY5kkFD Play around with those numbers to see how equity dilution plays out in the long run. Make sure to reshare this post to reach more founders. #equity #startups #founders #dilution #fundraising #pitch
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Passionate business coach for start ups and scale ups based in Belgium. Focus 360° - growth strategy, marketing, finance, funding, HR, technology, ✨Feet on the ground, Head in the sky✨
Useful reminder ! Captable seems often hard to maintain. This Cake equity calculator is useful Thanks to Wen Zhang (Duke MBA) #fundraising #captable #equitymatters
Visionary Marketing Leader | Expert in Brand Strategy & Revenue Growth | Transforming Companies into Market Leaders
💰 Startup Equity Dilution Calculator 💰 Play around with the numbers. Each new funding round dilutes the ownership. Initially, a founder or co-founders each hold complete ownership of the startup, with a single founder possessing 100% or each co-founder owning an equal share of 50%. As new investors join the rounds, the ownership gets diluted. Remember, the more equity you give up, the less control you will have over your company. BUT, running out of cash/ failing to raise new capital is the #1 reason why startups fail. In the rush to get those much-needed funds, founders sometimes skip over the analysis of how each round of dilution will impact the next rounds. When you are exiting with a company valued at let's stay $100 Million, having a 5% and a 6% ownership translates into a significant financial disparity. 7 situations where typically startup dilution occurs: 1️⃣ Series A and Other Funding Rounds 2️⃣ Initial Public Offering 3️⃣ Mergers and Acquisitions 4️⃣Secondary Offerings 5️⃣ Employee Stock Options 6️⃣ Convertible Securities 7️⃣ Creation or Expansion of Employee Stock Option Pools Here is a calculator by Cake Equity to help with those calculations regarding dilution: https://lnkd.in/grY5kkFD Play around with those numbers to see how equity dilution plays out in the long run. Make sure to reshare this post to reach more founders. #equity #startups #founders #dilution #fundraising #pitch
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This is a topic many founders don't like to talk about but need to understand quite well. This is about your stake in the company, and the attractiveness of your company in the future. Interesting tool to play around and simulate scenarios for the next round. For angels, this is about follow-on decisions and to what extent you can/will be diluted. #fundraising #dilution #captable #startups #angelinvesting
Visionary Marketing Leader | Expert in Brand Strategy & Revenue Growth | Transforming Companies into Market Leaders
💰 Startup Equity Dilution Calculator 💰 Play around with the numbers. Each new funding round dilutes the ownership. Initially, a founder or co-founders each hold complete ownership of the startup, with a single founder possessing 100% or each co-founder owning an equal share of 50%. As new investors join the rounds, the ownership gets diluted. Remember, the more equity you give up, the less control you will have over your company. BUT, running out of cash/ failing to raise new capital is the #1 reason why startups fail. In the rush to get those much-needed funds, founders sometimes skip over the analysis of how each round of dilution will impact the next rounds. When you are exiting with a company valued at let's stay $100 Million, having a 5% and a 6% ownership translates into a significant financial disparity. 7 situations where typically startup dilution occurs: 1️⃣ Series A and Other Funding Rounds 2️⃣ Initial Public Offering 3️⃣ Mergers and Acquisitions 4️⃣Secondary Offerings 5️⃣ Employee Stock Options 6️⃣ Convertible Securities 7️⃣ Creation or Expansion of Employee Stock Option Pools Here is a calculator by Cake Equity to help with those calculations regarding dilution: https://lnkd.in/grY5kkFD Play around with those numbers to see how equity dilution plays out in the long run. Make sure to reshare this post to reach more founders. #equity #startups #founders #dilution #fundraising #pitch
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Venture Debt Thoughts and Hyper Growth Stretch Plans & (Mostly) Rationale Stakeholders Obviously, most high growth companies develop plans with ‘stretch goals’ which often are not met. Funny thing is, though, if the Company rather than delivering the planned hyper growth, instead only delivers great to excellent growth, it’s highly likely that it’s plenty enough growth to still to still be attractive to both equity and debt players alike. Pick a partner you believe understands your business, the market, and underlying risks. It’ll be less likely that they’ll have ‘knee-jerk reactions’ to immaterial underperformance…and will recognize the difference… #venturedebt #venturecapital #startups
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Easy to use and play around tool for founders who are just starting up. Both founders and investors (especially early stage/ angel investors) should realize that founders need to have sufficient stake in the business to be long term committed. At the end of the day, you are banking on the founders' ability to create the business. I am aware of a D2C company in which the founders were left with only 9% collectively after series A! Valuation of an early stage cannot be justified by financial calculations ever. Its an interplay of business model, prevailing norms, opportunity cost for the founders and level of interest from the investor community. #angelinvestors #angelinvesting #venturecapital #startupecosystem
Visionary Marketing Leader | Expert in Brand Strategy & Revenue Growth | Transforming Companies into Market Leaders
💰 Startup Equity Dilution Calculator 💰 Play around with the numbers. Each new funding round dilutes the ownership. Initially, a founder or co-founders each hold complete ownership of the startup, with a single founder possessing 100% or each co-founder owning an equal share of 50%. As new investors join the rounds, the ownership gets diluted. Remember, the more equity you give up, the less control you will have over your company. BUT, running out of cash/ failing to raise new capital is the #1 reason why startups fail. In the rush to get those much-needed funds, founders sometimes skip over the analysis of how each round of dilution will impact the next rounds. When you are exiting with a company valued at let's stay $100 Million, having a 5% and a 6% ownership translates into a significant financial disparity. 7 situations where typically startup dilution occurs: 1️⃣ Series A and Other Funding Rounds 2️⃣ Initial Public Offering 3️⃣ Mergers and Acquisitions 4️⃣Secondary Offerings 5️⃣ Employee Stock Options 6️⃣ Convertible Securities 7️⃣ Creation or Expansion of Employee Stock Option Pools Here is a calculator by Cake Equity to help with those calculations regarding dilution: https://lnkd.in/grY5kkFD Play around with those numbers to see how equity dilution plays out in the long run. Make sure to reshare this post to reach more founders. #equity #startups #founders #dilution #fundraising #pitch
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Content Strategist, Creative Writer | Career Coach | founder @ 24faculty.com | MA in Communication and Journalism | Master in I.T
As a thought leader in the startup and fundraising space, understanding equity dilution is crucial for every founder. New funding rounds can dilute ownership, impacting control and future financial outcomes. Taking the time to analyze the impact of dilution at each stage is essential for long-term success. #equity #startups #founders #dilution #fundraising #thoughtleadership
Visionary Marketing Leader | Expert in Brand Strategy & Revenue Growth | Transforming Companies into Market Leaders
💰 Startup Equity Dilution Calculator 💰 Play around with the numbers. Each new funding round dilutes the ownership. Initially, a founder or co-founders each hold complete ownership of the startup, with a single founder possessing 100% or each co-founder owning an equal share of 50%. As new investors join the rounds, the ownership gets diluted. Remember, the more equity you give up, the less control you will have over your company. BUT, running out of cash/ failing to raise new capital is the #1 reason why startups fail. In the rush to get those much-needed funds, founders sometimes skip over the analysis of how each round of dilution will impact the next rounds. When you are exiting with a company valued at let's stay $100 Million, having a 5% and a 6% ownership translates into a significant financial disparity. 7 situations where typically startup dilution occurs: 1️⃣ Series A and Other Funding Rounds 2️⃣ Initial Public Offering 3️⃣ Mergers and Acquisitions 4️⃣Secondary Offerings 5️⃣ Employee Stock Options 6️⃣ Convertible Securities 7️⃣ Creation or Expansion of Employee Stock Option Pools Here is a calculator by Cake Equity to help with those calculations regarding dilution: https://lnkd.in/grY5kkFD Play around with those numbers to see how equity dilution plays out in the long run. Make sure to reshare this post to reach more founders. #equity #startups #founders #dilution #fundraising #pitch
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Fundraising is a momentum game, and as founders navigate the complex terrain of venture capital, aligning with investors who value substance and efficiency becomes paramount.🚀 Here are our tips to help you forge successful partnerships with VCs: 🚀 Prepare meticulously: Prequalify potential partners for efficiency. Research and understand what motivates your targeted venture partners, and ask upfront about their deal preferences. 🚀 Be transparent about the money: Clearly outline your financing structure, stage, growth metrics, and availability to connect. 🚀 Hone your pitch: Strike the right balance between realism and optimism. Keep your pitch concise yet informative, covering essential aspects of your business in under 10 minutes. 🚀 Be receptive: Keep an open mind and listen to strategic guidance from VCs who understand your market. Trust their expertise in uncovering non-obvious market opportunities. 🚀 Be responsive: Respond promptly and transparently to questions and due diligence. Demonstrate commitment, hustle, and intelligence to build credibility and trust. Ready to boost your #funding success? Partner with a VCFO today - http://t.ly/cXUDX #venturecapital #VC #funding #startups #startuptips #startupfunding #vcfo #cfo #melbournestartup #smallbusiness #smallbizau #smallbizaustralia
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Investments & Partnerships @India Accelerator || Ex- We Founder Circle || Ex- Founding Member & Director- Starlight Foundation || Ex Co Founder Ad-Rebate ||
What exit multiplier I can expect if I start doing Angel Investments? This is one of the most common questions Investors ask when they are starting to explore the angel investing space. The answer to that is tricky there can be multiple ways to answer this particular question but no answer can give you a fixed number. I know some people who have an exit of around 80x and this is just one example the upside therefore is huge, while this multiplier looks great but it comes with a disclaimer that these investors have at least invested in around 100 startups and then hit the jackpot of 80x. On the other hand, I also know some of the people who have heavily invested in the captable of a growth stage startup and eventually ended up losing all the capital as the startup got shut down. Averaging these 2 scenarios my suggestion to all the people who are exploring the angel investments space would be to diversify our portfolio as much as you can, Angle investment is a risky asset, and therefore multiplier is something that will depend upon the choice of the investor therefore choose wisely invest in those companies whose vision creates value and not just valuation. If you are someone who is still sitting on the fence about whether to start angel investing or not, I would be happy to chat with you. Kindly DM or comment here. #angelinvesting #startups #funding #investor #founders #exitstrategy
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I'm an AI operator turned venture investor bringing a founder mentality to the business of venture capital. Building and investing in public. Focus on UK early stage digital tech. More at unbundled.vc
The next couple of years are going to be brutal for VCs. Too much money invested in '20 and '21 at too high valuations in, on average, not high enough quality opportunities means investor returns will be terrible. Non-zero interest rates mean investors have other opportunities to earn decent returns - they don't have to take so much risk. Expect fewer emerging managers to raise, those with just funds I and II to be most affected (because most of their returns are affected), VC mergers that are distressed acquisitions in all but name, and zombie funds that can never raise again but have to manage their investments to expiry. If you're an emerging manager considering raising, you may have to be as creative as the businesses you are considering investing in. It will be easier for startups. Fewer businesses getting funded since then and everyone managing their burn aggressively means there will be fewer companies asking for less money less often. Startup funding will normalise first. #founders #startups #venturecapital #buildinginpublic #investinginpublic Pitch and newsletter links and unbundled dot vc.
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Attended a startup workshop where an investor said “founders who are seeking investment need to have a business plan”…. Don’t get me wrong, business plans are still important, but I have never met a VC that requires a business plan. Investment memo? Sure Pitch deck? Absolutely But a full scale business plan? Is this 1998? A business plan seems more for a founder to stay on target or for pitching to Banks. It always seem like if you speak with 2 VCs you get two different fundraising strategies. One says relationships with investors are important, the other says no, pitch when you’re ready. One says, don’t fundraise in the summer, the other says, fundraise around the clock 😵💫 Founders, focus more on building through revenue. The VC route is a treacherous road. #founders #vc #investors #pitchdeck #venturecapital #startups
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