note: StartupLJackson again on Twitter posts, this time he will focus on the Y Combinator incubator. He is standing in the Angle of the myriad hardships startup, comprehensive analysis on the financing of success where light avenue. In this agony of inculcation, only hope that the financing of more startups can success, qualified graduates.
, just in the April 25 (Saturday), cloud network hunting area southwest of start-ups road show will be held very coffee in tianfu software park, the scene will be assembled dozens of high-quality entrepreneurial projects, matrix partners, IDG capital, capital source and so on more than 10 investment institutions will attend screening.
hope this article on the need of financing entrepreneurs can have practical reference and guiding significance. The following for full text:
another year of YC funding season coming, negotiate the final valuation of all kinds of business, the company annual meeting was in full swing. This is some pesters. Wise investors will hatch in YC company a leg up and down and therefore made millions. Of course, there are poor investors will lose to crop failures, that was the end of the reality.
this is to say, there is a very worthy of our long-term problems are discussed. That is the founder of the enterprise how to in the big fish eat small fish, small fish eat shrimp in the economic environment of science and technology of seed round of financing? YC roadshow, the essence of what again? The following advice to YC entrepreneurs is purely personal opinion. This will be your company is the most important ever ever raise money, if not successful, it will threat than any financing before failure, the threat of it can make the company to destruction. Of course, if successful, the company will get funding and support for the development of pioneering business, have a more broad space for development.
please note: I don’t know which YC gave entrepreneurs about financing advice, they these clever runs a huge project, and I have learned that this year graduate from YC startups, many are impressive. But some of the company’s founder and not a veteran of the issuer. (or, in many ways they are very bad) it’s not a question of YC. Founder of the following are a few I gave in the past few years the , is not only for YC’s incubator) suggested the company please don’t get me wrong as a critique of YC.
figure out their own A round to what degree can
if you are A successful startup, will believe that A round of funding can’t be the last round of financing. Most of you are going to A wheel. In fact, you should first ask yourself whether you need to how much.
startups should decide on A round of funding to provide investors judge the metric system, such as pay taxes, unit economics, economic growth and so on. When with panel to share and exchange, entrepreneurial company should forecast ready for those who can attract their beautiful figures. If you is not allowed to target, born nature is hard to a good business plan.
now, what kind of person should find team needs to help you remain unresolved, and you really have this kind of person, I don’t think so. So you should make hiring and attracting talent’s budget. Note in to fill the vacancy of investors and the panel spend bit of idea on it.
moreover, startup companies to think about what needs to be done in marketing? In A round link should be strictly the collective action of the treaty? If so, then you are going to good how to solve? What is your marketing strategy? Even the super nerd MIT will marvel at need to drink so much whisky to fix a single business.
then, startups should confirm to achieve these goals will take time, complete the task if the time is always be extended indefinitely, company is difficult to get rapid development. So be honest with you in the results YC landslide, if some countermeasures, in the next two years, this situation should not continue.
your budget in the future now down to 50%. To believe that bad things happen, and especially for in the period of start-up venture investment company. Once you finished these, you can confidently rushed to the front of investors, extol your blueprint to him “in X months we many A thing happened, we have reached the standard Y, I believe we need to hire A to Z $C to D strategic plan” if you met A wise investor, so organized plan will be the best way to solve the problem. Good investors will help you make more perfect plan, while the poor poor investors will only make some irrelevant feedback, jabbering and ask the cheque should be sent to you.
to raise the appropriate scale of financing
overall, I think the biggest mistakes that investors make is to give rapid development project of high valuations. 100 times and 500 times the accelerator is pretty much the same in their eyes. And founder of one of the biggest mistake is to dilution overly optimistic.
a YC founders in the cafe last week how gossip to startups to raise funds ranging from $500000 to $10 million. , of course, $500000 is completely enough for company to make progress, but if you’re in A round link to raise $10 million, you need some decent rate of return on investment to attract investors. If you only raised $500000, you said you are out, of course that is to say, your company will probably die.
at the time the company will be on the pitch: not long after, the company for financing, again, of course, this must be like roadshow, financing the britain-big enough quickly and well meet the target. If god CARES for things go well you can get enough of A round of funding.
the money today is easy, but the value is unmeasurable. May, of course, not all things are in accordance with the law. With you there is only enough for six months or less money, you should raise as much as possible to the real cash available. The importance of money depends on your level of business, if you fail you will no longer have to restore the dream. The worst thing may be the next round of financing before you raise enough just only to be used for startup basic specifications. And because the company high valuations and difficult to retreat.
the wind cast as your colleague
ask investors how to invest plan? Whether there will be the next step plan? What is their expectations of A round of funding? If the seeds of the second round of funding, whether they want to participate? Startups should ensure that investors’ goals and whether your business plan in the same tone, and can achieve a perfect fit.
startup in finance generally will not have any problem. But if you want to meet a good investors to pull you up but it takes a long time. If you think the “work” is more important than looking for investors, you about the definition of “work” should be updated.
I’m YC itself organization structure and the process of entrepreneurial companies have some criticism, which is the mandatory – until before the roadshow, YC, are not allowed to start-up companies and investors have any contact. I once suggested that they improved the policy compulsory for startups to do so. I guess they do this request is that I wish to see startup pressure trying to invent new products. This kind of feeling is very good, but this has lead to venture capital and entrepreneurial teams under the condition of the contact time is short to make a choice.
should the founders in vc home for weeks and months. In theory, you should be a detailed talk to them and verify qualifications. Even if you can, you can also hire some other free VCS, in order to understand the different view of the house of the vc.
alternative plans as necessary
didn’t startups should think if things go on smoothly exit, how to raise additional funds. So let’s think about, which investors will need more money in your generosity. New investors, angel investors and some inexperienced investors will be more willing to splash out on more eye-catching new industry, nature can’t cling to you like a first love. You have set up a relationship can see its development trend through the company specifications system. They are more reluctant to, the double closed because they believe that their can be completely can dig up a bole and private companies.
after the roadshow day, make sure there are problems timely seek venture capital to properly solve, and can work together and wind cast as possible. Vc home can be generally is wise freelancers (if you don’t have the clear status to these men who are laid off, please automatically introspection stressed above)
also cannot ignore trivial
closed-end fund, closed-end funds, in my opinion it is nonsense, all the investors will increases its additional value. It is difficult to achieve if valuation does not conform to reality. The announcement of announcement and stock of standards should be high. Startups can’t so with investors, and profit.
– don’t you get overly optimistic cake, efforts to do big cake is more important.
self recognition, self development – now, although your peers may raised $12 million or more, but if put in his body, to the difficulty of startups to raise $6 million at a draught is also very one can imagine.
value – everyone will think oneself is the best of the world. In some special pressure on vc home a little they will do better. Make sure you thoroughly understand the vc experts are suitable for field.
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