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Mattermark Has Raised $2M in Our Second Seed Round

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Re: Mattermark Has Raised $2M in Our Second Seed Round

#21

Post by lalwanivikas »

bobjordan wrote: post #20
arfliw wrote: post #19

Earlier quoted context omitted.

I think 'answer to' is probably looking at it wrong, at least for good investors. They are there to help you when needed, to give you advice. They are not the hall monitor. However I've never had investors either, so perhaps I'm wrong. Given that she says she communicates with 75% of them at least once a month - that would indeed suck if the relationship was as you described.

In any case, would be much better to be answering to 40 paying B2B customers. I'd imagine if founder is not able to get focused on that, there won't be another round.

Agree! Quality advice can come from good mentors as well.

Re: Mattermark Has Raised $2M in Our Second Seed Round

#23

Post by tonydiv »

The amount of dilution here is worth noting:

YC: ~10% after conversion

500 Startups: ~10% after conversion

Version One, Felicis, etc (Q1 14): $1M+ investment at $5-$7M valuation at most? Another 20%

Flybridge, A16Z, Gramercy, etc (Q2 14): $1M investment at $6-$9M valuation at most? Another 20%

Between just these 4 groups, they own 60%+ of the company. I'm not accounting for angels. In addition to this, with an option pool, cofounder, COO, and a handful of employees, I wonder how much Danielle owns.

On a less pessimistic note, I wonder if there are acquisition routes. If so, who?

Re: Mattermark Has Raised $2M in Our Second Seed Round

#25

Post by flylib »

tonydiv wrote: post #23

The amount of dilution here is worth noting: YC: ~10% after conversion 500 Startups: ~10% after conversion Version One, Felicis, etc (Q1 14): $1M+ investment at $5-$7M valuation at most? Another 20% Flybridge, A16Z, Gramercy, etc (Q2 14): $1M investment at $6-$9M valuation at most? Another 20% Between just these 4 groups, they own 60%+ of the company. I'm not accounting for angels. In addition to this, with an option…

they have a few competitors (CB Insights, DataFox, Tracxn, Indicate.io), remains to be seen who wins out

Re: Mattermark Has Raised $2M in Our Second Seed Round

#26

Post by berkay »

patio11 wrote: post #12
berkay wrote: post #11

Earlier quoted context omitted.

If the requirement for VC investment is $1.5m in AAR and fast growth rate, there does not seem to be much of a "venture" in that. This sounds like what a bank would require to loan you money, an almost certainty that you can pay it back.

Banks will not loan you $5~10+ million on $1.5 million in revenue [+], which is what the Series A will likely be. They'd be happy to offer you $150k to $300k or so, depending on the officer. You can get a higher percentage when you graduate to a more stringent vetting process, which banks will typically start making available after you have $10M+ in revenue, significant hard assets, etc. (Business underwriting is har…

Agreed. I was more commenting on the more recent trend of "risk averse VC investment". As the OP states at $1.5 ARR, they would be profitable. It feels like VC investment in B2B space has become highly risk averse, only funding expansions of proven business models (we'll give you money if you can prove that you don't need it). This is a fine investment model but not sure it qualifies as "venture" investment. Can you really expect 10x returns if you're also looking for essentially proven, almost profitable businesses?

Re: Mattermark Has Raised $2M in Our Second Seed Round

#27

Post by pbiggar »

tonydiv wrote: post #23

The amount of dilution here is worth noting: YC: ~10% after conversion 500 Startups: ~10% after conversion Version One, Felicis, etc (Q1 14): $1M+ investment at $5-$7M valuation at most? Another 20% Flybridge, A16Z, Gramercy, etc (Q2 14): $1M investment at $6-$9M valuation at most? Another 20% Between just these 4 groups, they own 60%+ of the company. I'm not accounting for angels. In addition to this, with an option…

Those numbers multiply, they don't add. Also, some of your numbers are wrong if you look at her post, and others are pretty high: Danielle was a known quantity for VCs from her Twilio days and you can expect she raised her rounds at a premium.

I do the numbers as: .93 (YC) * .95 (500S) * .85 (option pool) * 0.83 (seed1) * .92 (seed2) * 0.86 (seed3) = 0.49

This doesn't account for the Referly->mattermark pivot, which may have led to some restructuring.

Re: Mattermark Has Raised $2M in Our Second Seed Round

#28

Post by jaksmit »

tonydiv wrote: post #23

The amount of dilution here is worth noting: YC: ~10% after conversion 500 Startups: ~10% after conversion Version One, Felicis, etc (Q1 14): $1M+ investment at $5-$7M valuation at most? Another 20% Flybridge, A16Z, Gramercy, etc (Q2 14): $1M investment at $6-$9M valuation at most? Another 20% Between just these 4 groups, they own 60%+ of the company. I'm not accounting for angels. In addition to this, with an option…

generally the math wouldn't look exactly like that. the initial investors (e.g. YC) would also get diluted in the subsequent fund-raises.

Re: Mattermark Has Raised $2M in Our Second Seed Round

#29

Post by argonaut »

tonydiv wrote: post #23

The amount of dilution here is worth noting: YC: ~10% after conversion 500 Startups: ~10% after conversion Version One, Felicis, etc (Q1 14): $1M+ investment at $5-$7M valuation at most? Another 20% Flybridge, A16Z, Gramercy, etc (Q2 14): $1M investment at $6-$9M valuation at most? Another 20% Between just these 4 groups, they own 60%+ of the company. I'm not accounting for angels. In addition to this, with an option…

The math might not be quite right here. Depending on how earlier investors are diluted by later investors, if at all, the 4 groups could own as little as 49% of the company.

Re: Mattermark Has Raised $2M in Our Second Seed Round

#30

Post by [deleted] »

bobjordan wrote: post #20
arfliw wrote: post #19

Earlier quoted context omitted.

I think 'answer to' is probably looking at it wrong, at least for good investors. They are there to help you when needed, to give you advice. They are not the hall monitor. However I've never had investors either, so perhaps I'm wrong. Given that she says she communicates with 75% of them at least once a month - that would indeed suck if the relationship was as you described.

In any case, would be much better to be answering to 40 paying B2B customers. I'd imagine if founder is not able to get focused on that, there won't be another round.

[deleted]
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