There is no standard thing called an “Investors Contract”, and it sounds as though you are trying to re-invent the wheel here. It also sounds as though you are doing all of this yourself, instead of using an experienced lawyer…which is a very, very bad idea. Read more
A while back I talked about how and where to find a co-founder in “For a Startup, Two Heads are Always Better Than One”. The feedback was good, but some readers asked me to be a bit more specific on attributes that might indicate an ideal startup partner. Even if you are looking in all the right places, it helps to know what you are looking for.
In this context, I’m broadening the definition of partner from co-founder to “business partner.” The reason is that good attributes apply equally well to “external” partners, as they do to internal partners, like a co-founder or CTO. A good overall example is the synergy between Google co-Founders Sergey Brin and Larry Page, as well as with Chairman Eric Schmidt. Read more
Most people think that the Peter Principle (employee rises to his level of incompetence) only applies to large organizations. Let me assure you that it is also alive and well within startups. I see startup founders and managers who are stalled transplants from large organizations, as well as highly-capable technologists trying to start and run a business for the first time.
Forty years ago, in a satiric book named “The Peter Principle”, Dr. Laurence J. Peter first defined this phenomenon. The principle asserts that in a hierarchy, members are promoted so long as they work competently. Sooner or later they are promoted to a position at which they are no longer competent, and there they remain, unless they start or join a startup to get the next level. Read more
The challenge you face is that there are other amazing ideas out there. Actually, there are many, many, brilliant, wonderful, amazing ideas out there. So faced with all these amazing ideas, investors invariably choose the ones that have been reduced to practice, developed traction of some kind and proved that they are amazing businesses, not just ideas. Read more
First things first – your startup needs a name! This may seem a silly and frivolous task, but it may be the most important decision you make. The name of your business has a tremendous impact on how customers and investors view you, and in today’s small world, it’s a world-wide decision.
Please don’t send me any more business plans with TBD or NewCo in the title position. Right or wrong, the name you choose, or don’t choose, speaks volumes about your business savvy and understanding of the world you are about to enter. Here are some key things I look for in the name, with some expert help from Alex Frankel and others: Read more
It doesn’t work that way. A convertible note and an equity round are two different things, done for different reasons. In most cases, the former is a quick way to get some money in the door in anticipation of the latter. Read more