Tag Archives: Money

Why I Just Invested in ProsperStack

You work hard to get new customers. So why let them slip away?

ProsperStack lets you provide custom offers when a customer tries to cancel. They can even segment your customers and give the best offers to your top customers.


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You can also A/B test different offers to see what works best. And you can do all this in a beautiful, no-code interface!

Only the largest companies, like Netflix, have special programs to stop churn. But why shouldn’t your company have it, even if you’re not a giant?

ProsperStack can also help you understand why customers leave. They can tell you “you lost $10,000 in monthly recurring revenue because you don’t have a Salesforce integration.”

That gives your company amazing direction. It’s time to put that Salesforce integration at the top of the list!

But the thing I like most about ProsperStack is that you can easily see how much revenue ProsperStack stopped from churning. This makes their value proposition crystal clear.

I’m delighted to be an investor in ProsperStack’s recent seed round! Book yourself a demo and crush your churn today!

What issues do you see with subscription churn? Leave a comment at the bottom and let me know!

There will be no blog on Monday. I have an acting gig!

See you on Tuesday. Have a great weekend, everyone! 👋

More on tech:

Q3 Venture Funding Slows to a Crawl

The Startup Red Flags

You’re Doing Investor Meetings Wrong

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If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Q3 Venture Funding Slows to a Crawl

Venture funding in the third quarter slowed to a crawl, according to a new report out this morning from Pitchbook:


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Estimated deal count in Q3 (4,074) is off by almost 20% from the quarterly record high recorded in Q1 (5,049) and is the lowest count seen in any quarter since Q4 2020 (3,364). Q3 saw $43.0 billion invested in VC deals across all stages, a nine-quarter low, cementing a tone of investor hesitancy and increased focus on business fundamentals amid the global economic downturn, even if the numbers remain high on a historical basis.

Exits were just $14B in the entire quarter. This is in line with figures from 8 years ago.

Meanwhile, venture funds continued to raise huge sums:

US-based VC funds have raised $150.9 billion, surpassing last year’s previous record and taking the 21-month fundraising total above $298.1 billion.

As an angel investor, I found July and August particularly slow. That’s usually vacation season anyhow, but this year the market was even colder than usual.

At the end of August, I spoke with the head of one of the most active VC’s in the US. He predicted a busy fall.

I was skeptical.

But sure enough, I started to see activity pick up in September. Those deals will probably take until at least Q4 to close, so they’re not reflected in Pitchbook’s numbers.

Personally, I made four investments in Q3, right around my usual pace. A down market is no time to back off — if anything, we want to be making it rain to take advantage of lower valuations!

But nonetheless, a lot of investors got spooked. I saw some great deals I was in only raise half as much as expected as investors pulled back.

Especially at seed stage, the market we’ll exit in will be totally different from today’s. So we should always be investing in great companies.

Warren Buffett said it best in his 1986 letter to shareholders:

What we do know, however, is that occasional outbreaks of those two super-contagious diseases, fear and greed, will forever occur in the investment community. The timing of these epidemics will be unpredictable. And the market aberrations produced by them will be equally unpredictable, both as to duration and degree. Therefore, we never try to anticipate the arrival or departure of either disease. Our goal is more modest: we simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.

Where do you think the venture market is headed? Leave a comment at the bottom and let me know!

More on tech:

The Startup Red Flags

You’re Doing Investor Meetings Wrong

Shopify’s Tobi Lutke on Layoffs and Building for the Long Term

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If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: “dead slow sign” by satguru is licensed under CC BY 2.0.

You’re Doing Investor Meetings Wrong

You’ve sent out hundreds of cold e-mails. Now you’re finally meeting with that big shot VC. How can you make sure you don’t blow it?


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Many founders I meet with make the same mistakes over and over during meetings. Here are a few of the biggest flubs, so you can avoid them!

1) Not leaving enough time for questions. Leave at least half the meeting for questions.

If you have a 20 minute meeting, leave the last 10 for questions. If you have an hour, 20 minutes presenting and 40 minutes answering questions is a good balance.

So often, I see founders spend almost the entire time presenting, leaving maybe 2 minutes for questions. Since I usually have 5-10 questions, that’s not nearly enough time!

Investors have certain objections you need to overcome to get a check. Answering their questions helps overcome those objections and get you the money you came for!

2) Don’t take too long to answer a question. When you answer a question, take about the same amount of time to answer it as the investor took to ask it.

If the question asks for a number, don’t respond with a story. This is a big red flag to me that the founder is hiding bad news.

Here’s an example of the wrong way:

Question: What’s your customer acquisition cost?

Answer: We’ve been trying a ton of different campaigns this year, and we’re having some really good luck with them! YouTube has been a great platform for us, we’ve gotten a lot of customers from there.

Instagram was not as effective until we started doing partnerships with influencers. Molly Cooks, who has 10,000 followers, did a collab with us recently that did great!

This is long, meandering, and doesn’t answer the question. Instead, try this:

Question: What’s your customer acquisition cost?

Answer: Our CAC is $37.

3) Don’t assume the investor knows anything about your company. For many angels and VC’s, their calendar is one 30 minute meeting after another, all day long.

This doesn’t leave much time to research each company before the meeting. And of course, sometimes we’re just lazy and entitled! 😂

So never assume the investor has looked at your deck, tried your product, or knows anything about your industry.

4) Be ready to present or just talk.

Some investors like to see you go through the deck and present the company formally. Others just want to have a conversation.

Even though I always look at the deck before a meeting, I still like to see the founder present it.

Reading a document on my own is one thing. Hearing what the founder has to say about it is quite another.

So be prepared to run the meeting as a presentation or just a conversation, depending on the investor’s preference.

If you can run a tight meeting using these principles, your odds of getting a check skyrocket. The investor clearly understands what your company does and you’ve addressed all her concerns.

What questions do you have about investor meetings?

Leave a comment at the bottom and let me know!

There will be no blog tomorrow. I have an acting gig.

See you on Wednesday!

More on tech:

When Are You Ready to Raise a Seed Round?

USV’s Albert Wenger on Climate and the Post-Capital World

Shopify’s Tobi Lutke on Layoffs and Building for the Long Term

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If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: “Wrong Way” by Elaine with Grey Cats is licensed under CC BY-SA 2.0.

New Report: Millions of Fails to Deliver in AMC and APE Shares

Fails to deliver in shares of AMC Entertainment Holdings reached the millions in the first half of September. The chaos hit both AMC and AMC Preferred Equity (APE) shares, according to a new report out today from the SEC.


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APE fails to deliver peaked at 2.4 million shares on September 1st. AMC fails to deliver peaked a week later on September 8th, at 2.2 million shares.

AMC shares have had large and persistent fails to deliver for over a year. It’s telling that as soon as APE shares were issued, huge fails to deliver appeared there as well.

Meanwhile, much larger companies continue to have almost no trades failing. Let’s take a look at fails to deliver in a few major stocks on Sept 1st:

Amazon: 0

Apple: 5,679

Microsoft: 0

Tesla: 14,727

APE: 2,366,422

And again a week later:

Amazon: 17,603

Apple: 523,020

Microsoft: 179

Tesla: 10,561

AMC: 2,164,802

Fails to deliver in AMC and APE are dramatically larger than in much bigger companies. Why are these shares in constant chaos while other companies are unaffected?

I suspect it’s because of naked short selling by hedge funds. This illegal practice involves selling short shares you never borrowed.

It’s a powerful weapon to crush a stock. If you never have to find shares to borrow, you can sell short any amount!

This can reach absurd levels. In August, we saw fails to deliver in APE shares exceed the entire daily trading volume.

The SEC must investigate what’s going on in AMC and APE shares. Until they do, it’s hard to believe the prices we see are real.

What do you think of the huge number of failed trades in these shares? Leave a comment at the bottom and let me know!

Have a wonderful weekend everyone! 👋

More on markets:

Over 43 Million APE Shares Fail to Deliver — Market in Chaos

Hedge Fund Manager’s Arrest Shows How Market Manipulation Works

Morgan Stanley Investigation Spreads to Multiple Countries

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If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

USV’s Albert Wenger on Climate and the Post-Capital World

Most of human history has been defined by a lack of capital. We struggled to scratch out a living from the earth and stay alive long enough to enjoy it.


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Today, our world is one of abundance. But what if the ice is melting right underneath our feet?

That’s the view of Albert Wenger, Managing Partner of Union Square Ventures, . In his new book, The World After Capital, Wenger argues that what we really lack today is not capital but a focus on key issues.

Wenger is particularly concerned about the climate crisis. On a recent interview on This Week in Startups, he argues that society has to undergo a transformation on the scale of the shift from hunting and gathering to farming in order to beat climate change.

The threat is real and shows up more prominently every day. One day it’s massive floods in Pakistan, the next a devastating hurricane in Florida.

Wenger and his legendary firm are fighting this battle by doing what they do best: investing. And unlike some VC’s, they’re not afraid to plunge into difficult hardware projects that could make a difference.

Wenger argues that software can’t solve most of the climate problem. I agree — we need solar panels, geothermal, and wind, not just computer systems.

Early VC’s successfully invested in hardware by taking a larger percentage of the company in early funding rounds. This model could work again for climate investments.

However, hardware is tough to scale and often has poor margins. So for now, I’m sticking to SaaS solutions.

While the climate crisis is urgent, I disagree that society must change fundamentally to address it.

The shift from hunting and gathering to static, agricultural societies was massive. But to address climate change, all we really need is some solar panels and wind turbines.

We’ll continue to live much as we do today. Our energy will just be coming from a different place, and we may be only dimly aware of it.

The biggest change may be geopolitical.

Would we care about Saudi Arabia if we didn’t need oil? Would we accommodate Russia in any way if we didn’t need gas?

Freed from resource dependence, countries may turn inward. If this avoids disputes and wars, I’m all for it.

I also disagree with Wenger about capital’s abundance. If you’re a white man on the US coasts (hi!), he’s definitely right.

But if you’re a woman, minority, or live in the developing world, scarcity is still the rule. From financial capital to roads and bridges, most of the world remains poor.

What do you think of climate investing? Leave a comment at the bottom and let me know!

More on tech:

SHOPIFY’S TOBI LUTKE ON LAYOFFS AND BUILDING FOR THE LONG TERM

WHEN ARE YOU READY TO RAISE A SEED ROUND?

HOW TO AVOID SCAMS, FIND INVESTORS, AND LEAD LIKE THE BEST

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If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: “Albert Wenger” by Joi is licensed under CC BY 2.0.

Shopify’s Tobi Lutke on Layoffs and Building for the Long Term

Few people did better during the pandemic than Tobi Lutke. The Shopify founder signed merchants to his e-commerce platform at a record pace, doubling revenues in 2020.

It was all systems go. Lutke hired like crazy to meet demand and locked up every server he could.

Meanwhile, Shopify’s stock price more than quintipled, putting the company’s valuation at over $200 billion.

In an excellent episode of This Week in Startups, Lutke tells us what it was like to guide his company through these heady times.

Employees were so distracted that Lutke had to make a rule: anyone caught checking the stock price had to buy donuts for everyone. Tim Horton’s, if you please.

But as the pandemic receded and stores reopened, consumers retreated from e-commerce. This left Shopify overbuilt and overextended.

Lutke was in a position he’d never been in throughout Shopify’s heady expansion. He had to do layoffs.

Shopify laid off 10% of the company this summer. For Lutke, the decision was wrenching.

“They were some of our hardest days.”

Tobias Lutke

Because Shopify had expanded ahead of demand. When demand dropped, that left Lutke with no choice but to lay off workers.

However, many of those workers would’ve never had the job in the first place had Lutke not expanded aggressively. And as well-paid tech workers, they’re likely to land on their feet.

Shopify’s tough times show how even large businesses struggle. A company with a $200 billion market cap can see its stock crushed and be forced to do layoffs just months later!

Take heart, early stage founders! The big boys face huge challenges too, just like you.

In all, I think Shopify is well positioned for the long term. It focuses on providing amazing service and doesn’t copy merchants’ products like Amazon.

When your livelihood depends on a platform, you want someone you can trust. Shopify fulfills that role better than Amazon.

I also commend Lutke for building a more honest culture at Shopify than most companies. He calls Shopify a team, not a family.

We all know the “family” rhetoric is nonsense. I have to give Lutke credit for telling it like it is.

I think his employees will too!

What do you think of Lutke’s leadership during the pandemic? Leave a comment at the bottom and let me know!

More on tech:

When Are You Ready to Raise a Seed Round?

How to Avoid Scams, Find Investors, and Lead Like the Best

The Founders: The Story of PayPal

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If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Who Will Unfreeze the IPO Market?

It’s every founder and investor’s dream: ringing the bell at the NASDAQ on the day you go public. But in 2022, that dream has been elusive as tech IPOs have vanished.


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From a report out this weekend in the Financial Times:

The stock market downturn since the start of the year has caused the longest drought in US technology listings this century, with experts cautious about the pace of a revival even after tentative signs of life in other sectors.

Wednesday will mark 238 days without a tech IPO worth more than $50mn, surpassing the previous records set in the aftermath of the 2008 financial crisis and the early 2000s dotcom crash, according to research by Morgan Stanley’s technology equity capital markets team.

Startups are afraid to IPO in a down market. The NASDAQ has fallen 28% so far this year, and many tech stocks have fallen far more.

No startup wants its stock to get hammered like high profile IPOs Robinhood or Coinbase:

When you go public and your stock starts dropping like a stone, employees watch the price all day. This hurts morale, not to mention productivity.

In these turbulent times, startups are better off in the tranquil harbors of the private markets. There, valuations rarely change and companies can build outside the public eye.

Startups are able to stay private longer because many raised huge sums last year. Many late stage startups bagged $100 million or more from firms like Tiger Global.

That means they don’t need to go public to raise money. So, they can wait until the most opportune time to cash out.

If I were a shareholder of a late stage startup, I wouldn’t want them to go public any time soon. Why risk a black eye in the markets when you can wait it out?

Sooner or later, the IPO window will reopen. The most likely candidates to force it open are high profile startups like Stripe or Instacart.

Indeed, Instacart is working on an IPO and may list later this year. If that IPO is a success, you can bet there will be many more.

Until then, let’s bide our time and build!

When do you think the IPO window will reopen? Leave a comment at the bottom and let me know!

More on tech:

Midas Speaks: Sequoia’s Don Valentine at Stanford GSB

Why Drone Delivery Will Be an Awesome Business

Giving Investors What They Need to Say Yes

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Save Money on Stuff I Use:

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: “Yahoo! opens NASDAQ” by Yahoo Inc is licensed under CC BY 2.0.

Over 43 Million APE Shares Fail to Deliver — Market in Chaos

The market in AMC Entertainment Holdings Preferred Equity (APE) shares is a mess. Fails to deliver (FTDs) peaked at over 43 million shares last month, according to a report just out from the SEC.


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These new shares were issued last month by AMC and began trading on August 22. FTDs peaked at 43,438,257 shares two days later.

This represents over 8% of all shares outstanding. And it all happened in 3 days!

FTDs like this is beyond a mix-up. It’s a total market meltdown.

FTDs remained elevated through the end of the August reporting period. They settled at 5,635,854 on August 31, the last data available.

Let’s compare the FTDs on August 24th in APE shares with those of some of the biggest stocks in the market:

Amazon: 0

Apple: 395,929

Google: 113

Microsoft: 0

Tesla: 530

APE: 43,438,257

APE shares have dramatically more FTD’s than other, much larger stocks.

FTDs can sometimes happen for benign reasons, like clerical errors. But when there’s a sustained pattern of massive trade failures, it often indicates naked short selling.

This generally illegal practice involves selling short shares without borrowing them first. It’s a powerful way to push down a stock’s price.

If you don’t have to find shares to borrow or pay interest, you can sell short as many shares as you like! All that selling makes a stock’s price crater.

If naked short sellers are targeting APE, so far they seem to be winning. The stock is down 43% since its debut.

The NYSE and SEC must look into this market breakdown immediately. One in three trades failing is not a functional market.

What do you think of the huge FTD numbers in APE shares? Leave a comment at the bottom and let me know!

Have a great weekend everyone!

More on markets:

AMC Fails to Deliver Pass 700,000 in New Report

Hedge Fund Manager’s Arrest Shows How Market Manipulation Works

Morgan Stanley Investigation Spreads to Multiple Countries

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If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

SoftBank May Launch Third Vision Fund

Masayoshi Son’s Softbank Group may launch a third, massive venture fund. From a report that broke this morning in The Wall Street Journal:


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Global tech investor SoftBank Group Corp. is considering the launch of a new giant startup investment fund, part of a plan to turn a new leaf after the poor performance at its two earlier funds, according to people familiar with discussions at the company. 

SoftBank, led by Chief Executive Officer Masayoshi Son, has been hit particularly hard by the rout in tech valuations that began last fall, posting a record $23 billion loss in the three months ending in June. 

The first two Vision funds, massive at $99 billion and $56 billion respectively, have not performed well. The first is up just 20% since its launch in 2017, while the second has lost nearly 20%.

Massive bets on WeWork, Didi Global, and others have soured, leaving the funds with huge losses.

But if we look at Softbank’s performance more closely, the picture begins to brighten.

Vision Fund 1 is at least in the black. And since it was launched in 2017, it has about another 5 years on its fund life.

That’s a lot of time to notch big gains.

Vision Fund 2’s performance looks awful, until you realize it’s only 3 years old. It’s common for venture funds to lose money early on, as poor performers go bust.

The big winners usually take longer to mature.

But the Vision funds have one big thing against them: size. A venture fund is expected to at least triple in 10 years to justify the risk.

That’s hard enough with a small fund, but when you’re sitting on $100 billion, it’s almost impossible.

If you own 10% of companies you invest in, you have to find companies that will generate $3 trillion of value in 10 years. That’s more than the entire market cap of Apple.

Even if you own 20%, you still need to find a Google. In every fund.

Companies like Apple and Google are rare, coming along perhaps once a decade. The idea that you’ll find one every few years and be able to get major ownership is unlikely.

Another problem with having so much capital is that you have to write tons of huge checks, fast. It’s venture capital meets Brewster’s Millions.

This means writing giant checks at high valuations with minimal oversight. After all, who has time to attend all those board meetings when you’ve got billions more to deploy?

Big investors have been lured by the siren song of venture capital for years, from Softbank to Tiger Global. They see the big returns and think “What if I could get returns like that on my $100 billion?”

The problem is that venture capital doesn’t scale that big.

Done right, Vision Fund 3 could be a huge success.

Valuations are down and capital is scarce. This is especially true at the late stage, Softbank’s specialty.

Son could have his pick of deals, making gains so large any past failures are forgotten. But he’d be wise to keep the fund small.

Son has had some incredible successes — Alibaba, DoorDash, Uber. He may be struggling now, but something tells me he’ll make a comeback.

Would you invest in Vision Fund 3? Why or why not?

Leave a comment at the bottom and let me know!

More on tech:

Why Drone Delivery Will Be an Awesome Business

John Doerr’s Biggest Mistake

Giving Investors What They Need to Say Yes

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If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: Masayoshi Son

Giving Investors What They Need to Say Yes

I see a lot of awesome startup ideas every day, from plant-based salami to rocket fuels. These entrepreneurs know how to build great businesses, but often have no idea how to communicate with investors.


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Some founders give me tons of details — but none of the facts I actually need! Let’s go through what information investors need in order to give you that “yes”:

1) Explain exactly what your business does, succinctly. If if takes paragraphs to explain, you’re doing it wrong.

You should be able to explain what you do in a single sentence. For example: “Uber makes it easy for you to get a ride anywhere, anytime.”

If an investor can’t understand what you do and why, he isn’t going to invest.

2) Show revenue clearly. You would not believe how many people get this wrong.

Report your revenue month by month. Don’t just tell investors your last month’s revenue, or add all your revenue up and report it as a single number.

Investors want to see a trend. Are you growing fast, or just treading water?

Showing revenue broken down properly allows them to see that trend.

Here’s an example of how it should look. Give investors both a table and a graph, so they can see exact numbers and visualize the trend.

Bonus points if you calculate your monthly growth rate using a tool like this. At that point, you’ve done everything but write the check for them!

That’s what you want to do: make it easy for them to say “yes.”

3) Be clear about terms and legal.

If you have a lead investor, the terms and valuation will already be set. Be sure to communicate those to every investor you speak with, so they know what they’re agreeing to.

If you don’t have a lead, be sure investors know that too. Some investors, like me, do not lead rounds.

Others only lead rounds, so the fact that you don’t have a lead is actually a positive for them!

Also, clearly explain how you’re incorporated. Most investors only want to invest in Delaware C Corporations.

If you can give this basic info on what the company does, how it’s performing, and how the investment will work, you will have answered most questions right off the bat. When a founder has her presentation dialed in like that, I assume she is experienced and highly competent.

Remember, if investors don’t have the info they need, the default decision is always no.

Make sure that doesn’t happen to you! Present the key facts clearly so you’ll have the greatest chance of success.

Where do you find founders struggling to communicate with investors? Leave a comment at the bottom and let me know!

More on tech:

I Pitched a Robot VC

How Wordcab Will Change Business Communication Forever

The Last Fast Food Worker in California

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Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: “100 Dollar Bills” by 401(K) 2013 is licensed under CC BY-SA 2.0.