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Wow! Are your relationships important!

Berkonomics

Forming business relationships at the highest level As you follow these insights from ignition to liquidity event, you’ll detect a continuing theme, emphasizing the need for deep and wide relationships that the CEO and senior staff can call upon for advice and guidance. That last 10% is most important and often overlooked.

Class 194
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Have you heard the rule of the thirds?

Berkonomics

It starts with sharing the opportunity and upside. Think of startups and early stage businesses whose entrepreneurs you know. We should think of the creation and growth of a high valued company as the sum of three parts, with three distinct classes of participants helping to make real value out of a raw start-up.

Startup 240
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Your need for a board grows with complexity.

Berkonomics

Start-ups with one founder rarely have or need a board of directors. Money from friends and family usually is offered in a casual manner with much less restriction than professional investors, so that a formal board is a logical step but not often created upon this event. Ownership is spread among several classes of investors.

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Need money? Read this!

Berkonomics

Some businesses require very little capital and the founder can self-finance the enterprise and retain 100% of its ownership and control from ignition through liquidity event (startup through sale). Bootstrapping: This term describes your ability to start a business with little investment and grow it using internally generated funds.

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Be careful about equity and options!

Berkonomics

It should contain a mandatory sale clause in the event of separation of a founder, so that a major owner who is passive in the enterprise cannot easily vote against measures other active founders endorse. How about multiple classes of stock? a share, then options must be priced at that amount.

Equity 156
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Equity financing: great for rapid growth startups

Berkonomics

There are three classes of equity investors for early stage businesses that we have not yet considered. If you are starting a virtual company with your employees working from home locations, as many startups do, it should be the location of the founder. This class of investor typically writes checks from $50,000 to $250,000.

Equity 232
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The Rule of Thirds

Berkonomics

It is rare when one person starts a company, supplies all the funding, and shares no management tasks or equity with others, and still grows the company to any significant size, worthy of a multi-million dollar opportunity to cash out at exit. First, there is the entrepreneur , the visionary, and force behind the venture from start to finish.

Startup 214