Category Archives: Raising money

Sometimes your gut is the best you’ve got.

How I didn’t follow my own advice Years ago, I led a deal and invested in a company that looked like it had lots of promise to disrupt the women’s clothing industry with special algorithms and an online store.  But … Continue reading

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Finding “stinky clauses” in legal investment documents

Here’s the problem: Investors sometimes join into investment rounds that have been pre–negotiated by others, receiving the paperwork already created by attorneys from that negotiation.  It is not uncommon for a sharp investor to discover a “stinky” clause or two … Continue reading

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What if you and your investors don’t agree on an exit?

First, the implied promise: Taking money from professional investors such as angels or VCs usually requires that you agree to seek an exit for those investors in your plan, often targeting five to seven years as the ideal period for … Continue reading

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Don’t just raise money. Do it on good news!

Why is this important advice? Because the first rule for raising money is to do it on good news – right when sales are increasing at an accelerating rate.  Or when a major customer signs a significant deal.  Or when … Continue reading

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The best advice startups will never follow

Dave’s note:  This is a reprint of a 2015 insight that seems to have struck a chord with investors and entrepreneurs. None of this advice has changed… Let me tell you a few short hair–raising stories of entrepreneurs who have … Continue reading

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Why your investors may not respond when you need money

When do most companies communicate? Early stage company investors as a group have a common gripe – almost universal.  Information flows from the company irregularly, in fact most often when the company is urgently in need of more money. How … Continue reading

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Can you defend your plan without being defensive?

When meeting with investors or even your board, during the period devoted to feedback after your presentation, you will hear comments and recommendations that don’t resonate with you. Some will be from a misunderstanding of your explanation. Some listeners will … Continue reading

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Don’t get hung up on early stage valuation.

Here’s the “what.” I can’t tell you how many times I’ve walked away from deals where the entrepreneur insists on a start-up pre-money valuation that is so high, no angel could expect to make a return upon the investment, even … Continue reading

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Raising money? Find your champion.

Increasing your chances of success If you seek funds from an organized investment group such as an angel fund, venture capital entity, or even an investment club, the first thing you want to do is to find one person to … Continue reading

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Financing with grants, not equity or debt

First, an example of grant-based financing           I was chairman of a company that, for twelve years never took a dollar of outside investment.  The company was funded entirely by grants from the National Institute of Health, amounting to millions … Continue reading

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