191–200 of 208 posts
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Egads.
dadgum.. 500k MRR seems low for a Series B.
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Can you please explain the numbers 2.0+, 1.4-1.5, etc. when referring to a programmer's skill. I have never seen this before.
Roughly speaking, it represents the transition from an adder to a multiplier. A 1.0 programmer is competent at "adder" tasks (scripts, bug fixes, features) but not yet ready for infrastructural work. A 2.0 programmer is highly competent as a multiplier. It goes from 0.0 (complete beginner) to 3.0 (global multiplier) but most (probably 99%) professional software engineers are between 0.8 and 2.2, with a median around…
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Roughly speaking, it represents the transition from an adder to a multiplier. A 1.0 programmer is competent at "adder" tasks (scripts, bug fixes, features) but not yet ready for infrastructural work. A 2.0 programmer is highly competent as a multiplier. It goes from 0.0 (complete beginner) to 3.0 (global multiplier) but most (probably 99%) professional software engineers are between 0.8 and 2.2, with a median around…
Reminds me of Landau's logarithmic rating of physicists by productivity from 5 to 0, with 0 being Newton, 0.5 Einstein, etc.
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I'm not a VC so I don't have an eye on the current trend, but a few years ago they were in less that 20% of deals in a particular quarter: http://venturebeat.com/2011/07/04/demystifying-the-vc-term-s... So, perhaps not exactly "rare", but uncommon. And rarely used, even if included. Back in 2008ish when I was more into fundraising, I didn't see them.
Have they been replaced with anything else? Without redemption rights what do VC have to keep control of founders?
Ultimately many of the good VCs would rather not "keep control" of founders. They'd rather just pass on the investments that look like they will become a big drain on VC partner time & attention in the future. A startup where there's a big power struggle over company directions and the board has to kick out the founders is far worse than not making the investment in the first place: it consumes a scarce resource (partner bandwidth) that could be much better spent searching for new opportunities. Much better to seek out founders where your goals are aligned to begin with and then trust them.
The difference in your experience and parasubvert's could be explained if the VCs you dealt with believed that your startup has a trajectory that would make it likely that it would become a lifestyle business, contrary to their interests. Then they'd want a way to claw back their capital if it looked like they would never see an exit.
First time founder. My company is in a "fatal pinch." Similar to a previous comment by @LukeFitzpatrick, we built something for our alma mater that we thought we could sell to colleges for 50k/year. We got investment, we built it, we sold it to a few more schools but the software is not feature-packed and mature enough to attract sales fast enough. Higher ed also moves super slow even when you're doing well. We're st…
The problem with education is that you compete with a lot of non profits or at least non profit mentality. Universities, for example, view making a profit as contrary to their mission (and to be fair, it probably is).
First time founder. My company is in a "fatal pinch." Similar to a previous comment by @LukeFitzpatrick, we built something for our alma mater that we thought we could sell to colleges for 50k/year. We got investment, we built it, we sold it to a few more schools but the software is not feature-packed and mature enough to attract sales fast enough. Higher ed also moves super slow even when you're doing well. We're st…
Please make sure it's something your team can actually get behind, and be very careful about how you put it. Because for experienced developers, any sign of pivoting to consulting is a sign to run for the exit. That's explicitly not what they signed up for when they took a chance on a start-up. Many will rather help out by cleaning the toilets than to fundamentally change the nature of their work. It's kinda shocking…
First time founder. My company is in a "fatal pinch." Similar to a previous comment by @LukeFitzpatrick, we built something for our alma mater that we thought we could sell to colleges for 50k/year. We got investment, we built it, we sold it to a few more schools but the software is not feature-packed and mature enough to attract sales fast enough. Higher ed also moves super slow even when you're doing well. We're st…
I'm at the prototype phase of an educational product and have shown the product to teachers and they are interested in using it in the classroom, but they have already expressed concerns in pushing sales through the school. It seems like you have had some success at least so if you could share any advice, it would be much appreciated. p.s. I can email you if you don't want to share publicly
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VCs can't ask for their money back. It belongs to the company and is in the company bank account. They can refuse to give you more, and if they control the board they can try to put in a new management team, but except for cases of fraud or other malfeasance, they cannot get their money back.
Most seed fund investment is in the form of a convertible note these days ... it's a loan with the option to convert to equity later. Consequently VCs can ask for the debt to be repaid (within the terms of the note). Obviously they'll only get back what's left in the bank and assets but the idea that they can't ask for it back isn't really true.
One way to avoid the fatal pinch is the Dickens approach: Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery. In a world with AWS and pay-as-you go services, it's more and more possible.
(Zero sarcasm) can you possibly explain, in different words, what this means?
It's worth noting that this is the antithesis of the stereotypical SV startup culture.
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It does not compensate developers for working on mundane projects. It does. That's not the sole reason why consultants make more, but that's a factor. If you're a full-time employee, you expect your health insurance, HR, work supplies, 401k, office space, finding of work, and your career growth and promotion planning to be taken care of, and you're likely to leave if you're not getting it. If you're a consultant, you…
That's true of sole practitioners . Most consulting engineers aren't that. They're employees of firms that bill them out.
A well managed internal team could do the work at 1/3rd the cost but the work is rarely a core part of the business and no executive wants to deal with the internal headaches and risk associated with the work when it won't get them anywhere politically.
The "contracting" world is much more like what michaelochurch described. And to be fair there are a large number of individual contractors working at large firms for great daily rates (think $1000/day on the lower end) for which what he is saying is true.