Author, Investor, Speaker, Mentor
We’re in a buyer’s market for capital these days, which means that every day I read headlines about how Startup X raised Y million at a Z billion-dollar valuation from Funds A, B, and Tiger Global. It’s very easy for first-time entrepreneurs to read these headlines and think that the most important number is Z, … Continue reading Choosing a VC based on valuation is like hiring the cheapest job candidate
First Round Capital, the first and foremost of the “micro” VC funds, recently released a retrospective set of lessons learned based on 10 years of investing data. It’s an incredible trove of data, some of which I love, some of which makes me feel uneasy. But since I always believe in working with the world … Continue reading The Ultimate Startup Success Plan (based on 10 years of data)
Alex Schiff is a great guy and the creator of one of my favorite products, Fetchnotes. I met him when he was raising money for Fetchnotes (in the end, I decided not to invest because while I loved the simplicity of the product, I concluded that there weren’t enough self-organizing people like me to represent … Continue reading The Only 4 Reasons Investors Say “Yes”
From Peter Thiel’s recent Reddit AMA: “As an investor, I think one must always maintain a certain amount of humility. There is only so much we can do to help the companies in which we invest. And because of this, the act of making the investment (rather than the ability to fix things later) remains … Continue reading The Value of Investors: Why I Focus On Helping Entrepreneurs
I enjoyed reading a recent Fortune article that provided a behind-the-scenes glimpse of the judges at a Rice University startup competition. It didn’t hurt that my old friend Robert Winter was prominently mentioned! http://bit.ly/UffMcc However, I think it’s hard for a reporter to truly understand the dynamics of a judging team. I’ve been a competition … Continue reading What’s It Like To Judge A Pitch Competition
Investors are fond of telling entrepreneurs about how dangerous it is to raise too much money too early on. We advise entrepreneurs to minimize fundraising until they achieve product-market fit, and are ready for scaling up. The problem is, entrepreneurs don’t want to hear it. It’s like telling Americans to lose weight by eating less … Continue reading When you raise a lot of money, you raise the degree of difficulty
Humans love to be surprised (as long as the surprise isn’t a nasty shock). As thinking creatures, our ability to develop an accurate working model of the world depends on our ability to spot the unexpected. Surprise is a great mechanism for rewarding that ability. Wharton conducted a study of viral videos. They had research … Continue reading The Power of Surprise
After writing about the importance of reputational capital, I realized that in many cases, it’s more important to focus on building your reputation. The key insight is this: As an entrepreneur, your control over the financial outcome of your startup is limited. Luck is a necessary but insufficient factor in nearly every startup success. On … Continue reading Why You Should Focus On Building Your Reputation
One of the pieces of advice that entrepreneurs receive is to ask any investors they meet to introduce them to other investors. This is good advice, but it’s incomplete. You should only ask for introductions to other investors *if* the investor is serious about investing in your deal. The reason is that experienced investors understand … Continue reading Reputational capital is just as precious as Financial capital
The great Eric Barker notes that the #1 negotiation principle that HBS teaches its MBA students is being likeable: http://bit.ly/19qRqeG “Here’s the equation for getting what you want. Cutting to the chase: You want to get more. You want more money, a better offer, a better deal; here are the components of what you need … Continue reading “They Need To Like You”: Friendship & Raising a Series A