The reason I make hundreds of introductions rather than just a few is that fundraising is hugely impacted by momentum. It’s best to fundraise within a short window so that there is a lot interest at once and investors have time pressure. Furthermore, most investment meetings don’t turn into investments so startups need a lot of introductions in order to create momentum and find the needle in the haystack.

Francis Pedraza, co-founder of Everest (Forbes Magazine, 2014)

Exiting Unprofitable Business Units

Companies spend more time developing new products and services than exiting their business units that lack growth potential.

The problem is that the head of such business units are unlikely to volunteer that their unit should be divested.  That’s why it is the responsibility of the CEO to identify which businesses need to be exited. Cisco, for example, recognises this and simply requires business unit heads to provide end of life estimates for their business units.  This would have been a useful practice for Kodak.  It continued to persist with film when it was clear that the world was heading to digital.

Which of your business units needs a “Kodak moment”?

Capital Raising: Anatomy of a Terms Sheet Part One

The Terms Sheet is a letter of intent from a venture capitalist or other investor summarising the important financial and legal terms of their investment in your company.  Here’s a summary of the terms commonly found in Australian Terms Sheets. There are usually between eight and 15 sections in an Australian Terms Sheet.  There are […]

Half your time is spent writing your business plan.  The other half is spent trying to fit it all onto your One Pager.

Ben Killerby

Alternative Explanations for Valuations of Airbnb and Uber

Social Capital theorists propose that Airbnb and Uber access the three social value drivers: advocacy, connection and collaboration. The two companies’ recent valuations are linked to the way they have used technology to build a social platform that encompasses all three drivers.
But perhaps a simpler (or parallel) explanation is that they are just selling excess capacity in a marketplace that we thought had regulations against selling it (planning consents for renting spare rooms and taxi regulations for driving customers for reward).
They are just driving a bus through the regulations that favour the incumbents at the expense of consumer utility.  The valuations are partly a bet that the two companies are best placed to take on the regulators and win.

Raising capital: it’s actually a lot like internet dating. You write a profile (information memorandum) you go on a first date (swipe right), you decide if you’d like to see each other again, (thank-you text), one party plays hard to get (valuation), meet the parents (due diligence), buy a ring (appoint lawyers), ask the question, (term sheet) and get married (settlement).

Greg Taylor, "Raising Capital Like Internet Dating" (Brisbane Times, June 10th, 2014)

Capital Raising: Terms Sheets

The Terms Sheet is often the most highly prized document for many companies seeking investment capital.  Which is odd, because it is rarely a binding agreement. A Terms Sheet is a short document (about two or three pages) which outlines the proposed terms of the investment in your company.  It usually does two things: Summarises […]

Over the past five to 10 years we have seen successful companies like Freelancer, BigCommerce, Campaign Monitor, Atlassian and others become leaders in their class.  They all share a common set of characteristics, namely great teams, global from the start and a marketing and sales strategy that is largely online.

Bill Bartee, Blackbird Ventures (The Financial Review "Boss - Leadership for Growth", June 2014), 13

In a pitch to an investor or to a prospective buyer of your company, the most important thing you are selling is…. you.  This video is a rapid fire, no-holds barred guide to the “perfect pitch.”  Note how many times the focus relentlessly comes back to the person giving the pitch.