Blog
What’s Really Behind the Questions Investors Ask?
A Slide-By-Slide Guide to a Winning Pitch Deck. You get one shot when you present to investors, so make it count. Over the past 40 years, as an investor, I have reviewed thousands of startup company pitch decks and I think fewer than 5% do an effective job of describing the investment opportunity. Where does it go wrong? Here are some examples: · Presenters answer the wrong question. For...
22 subtleties that can turn a losing pitch deck into a winner
Introduction. When a startup company tries to raise capital from a venture capital fund, an angel investor or a group of angel investors, it prepares a “pitch deck” that explains to prospective investors exactly how the company plans to make money and how investors will receive a return on their investment. The purpose of a pitch deck is to capture the attention of investors and possibly...
Net Present Value (“NPV”) vs. Deferred Valuation
Ever more frequently, I see startup companies using SAFE (“Simple Agreement for Future Equity”) investment structures or convertible notes to avoid negotiating a seed-stage valuation for their company. There are at least two problems with this approach: The “deferred valuation” schemes are great for companies but unfair to investors, for reasons we will explainThis approach signals to...
“Secrets of Sand Hill Road”: A Book Review
I knew when I first heard about Scott Kupor’s “Secrets of Sand Hill Road“ I would want to write a review of it. For one thing, very few top-tier venture capitalists have written books about venture capital, which has remained a fairly well kept, if not intentional, secret. My theory is that most of the top VCs are too busy becoming billionaires to write about it. My second reason for wanting to...
How to Write a Punchy Pitch for Your Startup
“The temple of art is built in words.”—Josiah Gilbert Holland Lately, I’ve been seeing a lot of startup pitch decks that are loaded with beautiful graphics that confuse me. I’m not sure who decided that pretty graphics improve your pitch, but sometimes they don’t. More and more, I find myself telling entrepreneurs, “Sometimes a word is worth a thousand pictures.” Here’s an example. Would you...
Entrepreneurship vs. Executive Management
“All our dreams can come true, if we have the courage to pursue them.”— Walt Disney If you have read “The Fundable Startup: How Disruptive Companies Attract Capital,” you know that I have struggled to understand the difference between “entrepreneurship” and being a successful CEO, I know that entrepreneurial studies programs try to teach students how to build businesses, but I have always felt...
The Fundable CEO
Many company founders want to be the CEO of their firm, but is that the best approach? Most successful CEOs work for 15-20 years to acquire much-needed expertise. A study of 2.7 million startup companies tells us that the average age of the successful startup CEO is 45. Venture capital investors have many opportunities to invest in companies with proven management teams. Startup founders need to...
8 Ways to Build Value in Your Startup
The concept of value is extremely elusive for startup companies. How is a startup company valued and how is value created in a startup? One reason the concept of value is so difficult is that it lies in the eyes of the beholder. Imagine a stack of startup company business plans or pitch decks complete with their visions, plans and financial projections. The best way to “calculate” the value of a...
How Startup Companies Should Compensate Their Advisors
How should a startup company compensate its advisors? This is a tricky question because there are no guidelines and most founders do not have experience in this area. But there are some general principles that can help you arrive at compensation that should be fair to the company and attractive to your advisors. Guiding Principles One obvious approach is to try to give your advisors an interest...
How to Choose the Best Advisors and Directors for Your Startup Company
Choosing advisors and directors for a startup is much more complicated than most founders realize. A very high percentage of startups pick advisors for the wrong reasons and end up regretting their choices. If you were trying to find the best doctor to perform LASIK surgery on your eyes, wouldn’t you find the one who has performed the most LASIK procedures? Or at least one who has performed more...
