Thoughts on startups by investors that
fund them & entrepreneurs that run them

What is the maximum amount of money a pre-revenue mobile Internet startup can expect to raise from the VCs?

To start with, a pre-revenue mobile company cannot expect to raise anything from “the VCs”. Venture capital funds invest in only one out of every 400 companies seeking funding, so the odds of your particular startup getting funded are astronomically against you.

Next, venture capital funds invest primarily in later stage companies that have already shown significant indications of success (known in the industry as “traction”.)  Of

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7 Questions Test Entrepreneur Focus Before Funding

Image via Entrepreneur.com

The first question most people seem to ask when contemplating a new startup is where they will get investor money. That’s certainly a valid question, but all the money in the world won’t make your business work if you don’t have a plan to use it, or hate what you are doing. I suggest that there are

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Do venture capital firms or private equity funds offer debt financing for startups?

The direct answer to your question is NO, VC and PE funds do not provide debt financing for any companies. Their entire business model is based on investing in companies that can potentially offer very high returns. For venture capital, this is typically ten times the invested capital, and those returns can only be achieved through equity appreciation, not debt service.

Series Seed or Convertible Note? Which one is more founder friendly? Which one do investors prefer?

There is not a definitive answer to this, because a good lawyer can write terms into either one to make one or the other preferable to one or the other party.

That said, the primary entrepreneur-friendly reason for doing a Convertible Note(and the reason that no serious investor under regular circumstances will therefore do an uncapped note) is:

The Smartest Entrepreneurs Bootstrap Their Startup

Image via niaje.com and www.yec.co

There is so much written these days about how to attract investors that most entrepreneurs “assume” they need funding, and don’t even consider a plan for “bootstrapping,” or self-financing their startup. Yet, according to many sources, over 90 percent of all businesses are started and grown with no equity financing, and many others would have

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What are the differences between startups/tech companies founded in Silicon Valley and those founded in New York?

While there are differences in the startup communities on the two coasts, and while there are definite differences in the investment communities, I’ve found much less of a difference in the types of companies being started.

What are the top VC firms and angel groups in Seattle/Portland/Vancouver (or Pacific Northwest area)?

The Pacific Northwest has some of the best and most active angel groups in the country (and I say that coming from New York!) Check out:

8 Key Questions To Expect In Investor Due Diligence

Image via LeadChangeGroup.com

If you really want to impress a startup founder as a potential employee, or you want to be a smart investor, you need to know the right questions to ask. These are the questions that get past the hype of a founder “vision to change the world,” and into the realm of real business strengths, weaknesses, and

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Where do I find serious non-tech local investors?

The problem with this scenario is that you are describing an oxymoron, and wondering why you can’t find a hot ice cube, or a tall hole, or a submarine that can land at ATL. You write:

“Where can I find intelligent and serious investors who aren’t looking for a cash cow, but are willing to use their funds to contribute to

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What are some good ways to get to meet with VC’s without introductions?

Actively build, maintain and make use of the amazing social networking tools that are available. Right now, there are over 11 million people who can provide an introduction to me through LinkedIn (and I am far from an open networker.)

If you can’t figure out how to get one of those eleven MILLION people to recommend you to me, that’s probably

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