Business 101 for startups by Fred Wilson
Back when we were doing our MBA Monday series on Financing Options For Startups, I got an email from my friend Andy Sack. Andy was one of the first entrepreneurs we funded by in the mid 90s with our Flatiron Fund. He’s done something like a half dozen startups since then and he’s a veteran in…
Continue readingRevenue Based Financing
We are coming to the end of the Financing Options series. This is the final post in the series. Today we are going to talk about working capital financing.
For those of you not steeped in finance and accounting matters, I suggest you go back and read the Balance Sheet post before reading on. Working…
Continue readingFinancing Options: Working Capital Financing
Today’s post in the financing options series on MBA Mondays is about Bridge Loans. Bridge loans are so called because they are a “bridge” to something else. They are short term loans intended to fund a company to an anticipated event in the future.
Bridge loans exist in many sectors outside of the startup world.…
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Today on MBA Mondays we are going to cover yet another topic in the Financing Options series, financing capital equipment like servers, routers, switches, computers, etc.
Equity capital is expensive. Every time you do a raise, you dilute. It makes sense to look for places where you can use other less expensive forms of capital…
Continue readingFinancing Options: Capital Equipment Loans and Leases
It’s Monday, time for MBA Mondays and the next post in the Startup Financing Options series. Today we will talk about Venture Debt.
If there were two words less likely to be found together, it would be venture and debt. Startups are not credit worthy enterprises. They have little to no assets and no cash…
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Today on MBA Mondays Startup Financing Options series, we are going to talk about the financing option that I specialize in โ preferred stock.
Almost all venture capital firms and many angel and seed investors will require the company they are investing in to issue them preferred stock. The vast majority of equity dollars…
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MBA Mondays are back after a one week hiatus. Today we are going to talk about convertible debt. Convertible debt can also be called convertible loans or convertible notes. For the purposes of this post, these three terms will be interchangeable.
Convertible debt is when a company borrows money from an investor or a group of investors and…
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Last week’s financing options post was about getting your customers to finance your business. This week’s post is about getting your suppliers to finance your business.
Truth be told, this is not very common in the startups I work with. The more capital intensive your startup is, the more you can and should think about…
Continue readingFinancing Options: Vendor Financing
I wrote in an earlier post in this series that friends and family is the most common form of startup financing. If you are talking explicitly equity investments, then that is probably true. But the most common way that startup businesses get money to get going is they sell something to someone. In this context, someone means customers.…
Continue readingFinancing Options: Customers
Governments will provide capital for startups and I’ve seen many entrepreneurs over the years take advantage of this form of financing. The grants are usually “free money” in the sense that they do not need to be paid back and they don’t cost any equity.
But nothing in life is free. You do pay for this money in ways that…
Continue readingFinancing Options: Government Grants