Behind the scenes of a psychological campaign
There’s a great story I know about a very sophisticated marketer who writes 30-page long emails. Someone asked him, “Does anyone really read those?”
He laughed. “Only the buyers,” he replied.
Analyzing Financial Statements
This topic could be and is a full semester course at some business schools. It is a deep and rich topic that I can’t cover in one single blog post. But it is also a relatively narrow skill set at its most developed levels. If you are going to be a public equity analyst, you need to understand this stuff cold and this post will not get you there.
The Profit and Loss Statement
Today on MBA Mondays we are going to talk about one of the most important things in business, the profit and loss statement (also known as the P&L).
Picking up from the accounting post last week, there are two kinds of accounting entries; those that describe money coming into and out of your business, and money that is contained in your business. The P&L deals with the first category.
The Best VC Meetings are Debates not Sales
This is part of my blog series “Pitching a VC.”
I’ve sat through a lot of VC pitches and having been CEO of an enterprise software firm for many years I’ve also sat through many customer meetings with sales teams.
The problem with taking seed money from big VCs
I recently met an entrepreneur who was raising money for his startup. Six months prior, he had raised seed money (<$1M) from one of the increasingly popular seed programs big venture firms are offering (big venture firms = roughly $100M fund and larger). As a potential investor, the first question I asked him is “is the big venture firm following on?” The answer was no. What this means is the entrepreneur is going to have a *really* tough time raising any more money at all, because what all potential investors think is “if this top VC that has hundreds of millions of dollars and knows this company the best doesn’t want to invest, why would I?” What the entrepreneur didn’t realize is that when you take any money at all from a big VC in a seed round, you are effectively giving them an option on the next round, even though that option isn’t contractual. And, somewhat counterintuitively, the more well respected the VC is, the stronger the negative signal will be when they don’t follow on.
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The First VC Meeting (Post 1 of Many)
I see a minimum of 3-5 pitches per week and often I see up to 10. I also have raised more than $40 million as an entrepreneur and CEO across multiple rounds of venture capital in 1999, 2000, 2001, 2003 and 2005. That means that I have probably pitched maybe 120 investors and received 20 “yes” answers and nearly 100 “no’s.” Well, actually, VCs never really tell you “no”, they just tell you, “interesting. It’s a bit early for us. Call us back when you have a bit more traction.” Which basically means, “No. But just in case you get big against all odds, please come back and see us since I didn’t tell you no.” 