Let people know what you can do ‘differently’. Entrepreneurs should talk about their capital efficiency. Probably you are doing some work cheaper than others or you have access to a group of customers – think of any leverage point you have and flaunt it.
2.Communicate through a story
People find stories interesting and exciting. There was this problem and I thought this product would be perfect. Know more about the idea and your product and have a good story with it.
3.Accept that your Startup may have flaws
Every startup has one issue or the other in the early days and accept these issues. Don’t spend time convincing others why your startup is like this or like that. Spend that energy in explaining what your startup may grow up as.
4.Plan Small and Dream Big
In the early days you can’t be extravagant and you need to explain this to be funded properly.
We suggest you read this post at OnStartups for more insight to the topic
Even though I know an idea is likely going to take more cash than the entrepreneur things, I prefer backing people that believe they can do it with little cash and try to do so. As Josh said, learn to fail cheaper
These points may come across as basic, but these are the small points one should keep in mind when launching a startup;
1.Start by thinking small and extend your thinking from there. Small and simple thinking will allow you to concentrate on what is important
2.Higher good coders/technical people in every department 3.Financial reward is good, but aspiring entrepreneurs should first look out for opportunities where thy can learn. Allow employees to take on projects even if they don’t have the qualifications.
4.Don’t manage profit, but cash flow. Money in and money out should be the only two financial yardsticks that matter.
5.Perfection is the enemy of success (incase of startups). Speed is better than perfection.
6.Sell, sell and sell. Selling to everyone including business world, employees and suppliers. Sell yourself, sell your product, have a sales professional in your team.
Option pool can be described as the amount of a startup’s common stock reserved for employees, directors, advisors, and consultants. The stock reserved is then issued to the aforementioned stakeholders. It is through a written plan a startup pre-authorizes the amount of the company’s common stock which will be issued by the administrator (usually the startup’s board of directors or a committee selected by the board). A startup, for example, can have 5,000,000 shares of common stock but only elect to authorize 2,000,000 shares.
A startup’s original option pool may not likely turn out to be the last option pool the startup creates. The size of the pool should be discussed at each round of funding and financing, since at that time, the startup might need more equity options to attract and motivate future hiring.
The confusing part of an option pool is how the option pool’s non-issued or unissued portion is treated.
We suggest you read this post for a detailed insight into Option Pool Shuffling
Summary: Don’t let your investors determine the size of the option pool for you. Use a hiring plan to justify a small option pool, increase your share price, and increase your effective valuation.
A heated debate is taking place around Foursquare considering a sale to Yahoo. It is believed that Foursquare is in the midst of an aggressive courtship on behalf of Yahoo, who is willing to pay as much as $125 million for the year old startup. Some are freaking out asking Foursquare ‘not to sell’ and the gurus are speculating that Foursquare is trying to push its valuation higher than what Yahoo is offering. What Foursquare does, only time with tell, but this has definitely made me think about ‘exit strategies’ for startups and the importance of having one.
When you are starting up or as you form strategies and plans to grow your startup, you need to think about an exit strategy. Will you establish a lifestyle business that generates income without plans of selling it in the future, or will you build equity in a business that you will convert into cash? Depending on your goal, the business you choose and the way you decide to grow it should be aligned with the end-game objectives. The common exit strategies are; sale, mergers, IPO, buyout or liquidation of assets.
Some may not find laying too much importance of exit strategies as correct, arguing that you will never want to build something by always having a motive of leaving. But whether you want to move on to you next entrepreneurship venture or whether you stick to a business plan for a long time, it is important to have a succession plan in place for your startup.
We suggest you read this post at ReadWriteWeb for more information.
While the idea of an exit strategy might sound negative, crafting one can help you plan how to make the most out of a good situation, not simply escape a bad one
There can be two cases when it comes to startups; first that the founder chooses to be the CEO and second is the case where the CEO is appointed by the founder.
In the second case, founders usually start their company and hire a CEO when things get going and handling everything by themselves becomes difficult. CEO’s do a lot of corporate navigation, formulate plans and strategies, basically with their experience they give a strategic outlook to the growth of a startup. Founders on the other hand, have a passion for their product which is a major driving force for a startup. Both are vital to the existence of any business, but when it comes to choosing between the both? What if for some reason either of them has to leave?
Of course, all businesses are different, and people may leave for different reasons. But VCs invest in founders as much as they do in ideas, so for a company to lose that passionate individual that the VCs initially trusted might send out bad signals. On the other hand a startup will lose direction if a CEO decided to quit.
If someone needs to go, who should leave? The CEO or founder?
There is an interesting read on the above topic at ReadWriteWeb
Regardless of the nature of the breakup, it got me thinking about the dichotomous relationship some startups have between founders and CEOs, and which, if either, is more expendable.
Investors and entrepreneurs may not always have the same needs and motivations, hence it’s a common phenomenon that investors might reject your startup idea because it’s not a right fit for them. It is important for both parties to know how to deal with this rejection.
One suggestion here to entrepreneurs is to never ask for referrals. When your pitch is rejected, the worst thing you can do is ask for a referral. It won’t work in a professional business context. The venture capital community is a very close-knit group that has a high amount of trust and reliability in one another, so it is quite irrelevant to ask for a referral. Entrepreneurs should be careful with this.
Just as the entrepreneurs, investors need to know how to deal with a rejection as well. Following “honesty is the best policy” approach will be the best here. Be clear, concise and honest to startups. Entrepreneurs, on the other side of the table should take rejection for what it is, and not push back for a referral.
A note to startup entrepreneurs – don’t take rejection personally ever. And don’t forget to look on the bright side of a rejection; something better is waiting for you always.
For more insight on this matter, we suggest you read this post at ReadWriteWeb
Bijan Sabet suggests. Sabet says that had he not been turned down for his first job application, he may not have found himself where he his today, both professionally with becoming an investor, and personally with meeting his wife.
Following is a list of useful collaborative tools to help your startup ‘virtually’:
1.Meetup (Event organizing/Crowdsourcing)
What can be better for startups than to create some events locally or attend some – meetup is a great way to network and meet potential business partners. If you’re developing in Joomla, then organize a Joomla meetup or if you’re looking for writers for your blog then attend a blogging meetup. Meetups can be organized and attended according to the area you belong to - excellent tool for promotion and networking.
2.CrunchBase (Startup Promotion)
This is a great way to gather information on what everyone else (other startups to be specific) is doing. CrunchBase is a great source to tap into the startup market and check what is happening out there – who’s getting funding from who, how much of funding, new launches etc. If your application by chance gets attention from TechCrunch staff, it can have a massive effect. I know of a case where someone who had their startup featured once on TechCrunch and generated 300 leads from TechCrunch itself.
3.Yammer
Yammer is the Twitter of your startup. It resembles Twitter, but is totally private, so that only your employees can see what you are working on, what coffee you are having or what you thought of the latest episode of Friends – a dead-simple collaboration tool that all startups should use.
4.GoPlan (Task Management)
It is a simple and effective task management application (or a to-do list application) that allows you to quickly organize a project, share it and see its progress. Features such as tasks, milestones, discussions, and calendar make this application more interactive.
5.Zoho CRM
It is a free Customer Relationship Management System that you can use to manage customers, sales and opportunities. It is a free application for anywhere up to 3 users and has a lot of nice features including an API, dashboard and inventory management.
Let us know what you think of these applications and also suggest others. We at Vinfotech use these apps quite extensively. We also help building such applications. Get in touch with us for your development and design needs.
TechCrunch has been profiling information about startup websites, companies and products since 2005. It is a great resource to get the latest news about web startups and established tech companies. What companies have been started, acquired and funded as well as information about larger tech companies – all of this in one blog.
I have subscribed to the RSS feed and follow the blog religiously; it’s my favorite Technology blog. With a Technorati rank of 3 and a huge following, TechCrunch is a must read for anyone looking for information around startups. What I like about TechCrunch is the fact that it takes an ‘opinion’ on the news (which is generally an informed one).
Another interesting point is the comments section of the any post on TechCrunch – the discussions, opinions and views of various tech geeks around the world is highly informative. Do go through them to get a better insight to the post.
With the blog authority and readership TechCrunch it has, it has become the dream of any startup to get featured on their website. I wouldn’t be surprised if a startups first PR strategy would be “how to feature on TechCrunch”. TechCrunch has also been surrounded by various criticisms but that is all in the game.
According to me, TechCrunch is a must-read blog for any web geek to gather information on startups, high tech giants, industry news, motivational tips and personal experiences.
A bill* was introduced in the Senate (USA) on the 24th February 2010 proposing a new type of visa for immigrants who create startups and jobs in the U.S.
*The Startup Visa Act of 2010 will crate a two year visa for immigrant entrepreneurs who are able to raise a minimum of $250,000 (with $100,000 coming from a qualified venture investor or U.S. angel). After the two years, if the immigrant entrepreneur is able to create five or more jobs (not including spouse or children), attract $1 million more in investment, or produce $1 million in revenue, he or she will become a legal resident of the United States of America.
The introduction of this bill is the result of a blog post written by Paul Graham in April 2009 (one of the partners at Y Combinator). In the post, titled “The Founder Visa,” Paul explained that foreign-born students who graduate from a U.S. university can’t stay back in the U.S. to start a company. This post was passed around by bloggers, entrepreneurs and venture industry veterans until it was turned into a savvy social media campaign (including twitter, Facebook, YouTube etc). And the result is in front of us today, the campaign was a success and the bill was introduced a few days ago.
The message associated with the bill is quite straightforward – create jobs and get a green card. Even if the bill passed it isn’t going to attract a herd of entrepreneurs’ right way. It will eventually gain momentum. U.S. is welcoming entrepreneurs from outside the United States, and is promoting ideas and startups.
An interesting discussion is going on in this forum regarding the pros and cons of the bill.
Personally, I believe it’s a strategically well thought decision that would ease out rules and allow entrepreneurs all over the world to harvest their ideas in the technological hub of the world, and besides beneficial for the U.S. as well in terms of employment, innovation and growth.
For more information on this, we suggest you visit TechCrunch
Lucid Imagination – the startup launched in 2009 which distributes Apache Lucene and Apache Solr search technology announced that it has raised $10 million in venture capital funding (completes its Series B round) with existing investors Granite Ventures and Walden International and new participation from Shasta Ventures.
The startup is the commercial entity for Lucene/Solr and it offers a broad portfolio of software and service solutions. It offers differentiated search for organizations across a wide range of sectors including Web 2.0, media, telecommunications, government etc. Its customers include Nike, Ford, Zappos, eBay, Ford, Cisco and many others.
Funding will be used to accelerate readiness and adoption of Lucene/Solr search technology. It had a total funding of $6 million before this and after this deal the company’s total funding comes up to $16 million.
A startup which is in its second year is seeing revenue in millions and counts Google’s enterprise search as its direct competitor.
This is definitely great news! Congratulations to Lucid Imagination. A good source of motivation and inspiration for startups
You can visit TechCrunch for a detailed description:
the startup that commercially distributes the open source Apache Lucene and Apache Solr search technology, has raised $10 million in Series B funding from
photo credit: cambodia4kidsorg
