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How Many Investors Should You Talk to in a VC Fund Raise? And How Do You Prioritize?

Both Sides of the Table

The typical VC process is as follows: They say there are three rules in property: Location, location, location. The surest sign a fund-raising process has stalled is when you aren’t getting follow-up meetings or hearing from the VC or hearing from friends that they got a phone call or email asking about you. Same with VC.

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Is Convertible Debt Preferable to Equity?

Both Sides of the Table

Seth Levine of Foundry Group addresses this important topic this morning on his blog with a post, “ Has Convertible Debt Won ?&# Convertible debt is an investment that “converts&# into equity in the future usually at a discount to your next funding round price and sometimes has a “cap&# (maximum price).

Equity 319
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Turning the Camera on Chris Dixon

Both Sides of the Table

Chris Dixon is one of my favorite people in tech and writes one of the few blogs I read religiously. He and I once took different sides of an debate about whether “VC signaling&# in early-stage deals is a serious problem or not. If you don’t read it and you care about tech & entrepreneurship, you should.

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How to Configure Your Startup Team

Both Sides of the Table

Quick summary: Be careful not to have too many co-founders. And you need to be careful about giving up control to cofounders as much as VCs. I don’t think VCs care as much about co-founders & economics as people think. Hire admin / office management after you raise a reasonable size VC round.

Startup 388
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What Should You Do with Your Crappy Little Services Business?

Both Sides of the Table

This thinking is largely driven by the venture capital industry (and subsequently Wall Street) who are in search of high margin, highly scalable businesses. It’s nearly impossible to get a services company financed by VCs. Why Shouldn’t Most Services Businesses Raise VC? Even tech blogs know this.

Services 332
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The Co-Founder Mythology

Both Sides of the Table

So for anybody who reads my “This Week in VC&# transcripts but doesn’t watch the video – this one’s for you! Here is a quick summary of my POV: When you start a company a 50/50 partnership seems obvious. Give them a large sum of equity. People just don’t talk about it publicly or in blogs.

Startup 393
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Some Thoughts about Selling at Startups

Both Sides of the Table

I got an email recently from my friend & fellow VC, Jeff Bussgang from Flybridge Capital Partners in Boston. Jeff (also an HBS alum) co-teaches the LTV course with Professor Eisenmann about a student of theirs who had written a blog post about sales taking on some of my previous assertions. In Summary.

Startup 319