Shubhankar Bhattacharya

"Platform" in VCs often feels undefined, and different at every firm. But one thing is clear: firms with dedicated platform teams are seeing higher investment returns. What is 'Platform' in VC? Think of it as a support engine for portfolio companies. Platform teams accelerate growth by providing: 1) Strategy & Growth 2) Talent Partner 3) Marketing & Brand Partner 4) Business Development & Partnerships Lead 5) Community Manager 6) Operations & Scaling Partner 7) Fundraising & Capital Advisor Platform in Venture Studios vs. VC Funds: The big difference? Timeframe. Venture Studio Platform: Involved from concept to exit, guiding startups from the very first spark of an idea. VC Platform: Steps in after the startup is funded, focusing on scaling and growth but not the initial concept phase. Both play critical roles—but understanding these distinctions helps founders and investors make the most of their platform relationships.

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Startup decks vs Business plans. It's accepted that a startup needs a deck. Dax Dasilva of Lightspeed Commerce made an important point on 20VC. Writing a business plan - including financial projections - is an important step. It requires discipline. It provides a rigorous framework for thinking deeply about the problem you're trying to solve. Harry Stebbings countered that he doesn't even want to see a deck since it's all dreams. We spent a lot of time and energy on our business plan with the expectation that we would show it to no one ever. The business plan was part of our roadmap for the company. We researched customers - including having 50+ conversations. We wanted to understand them: their background, their interests, their presence on social media. We also wanted to understand how they were evaluated by leadership and how integrated they were with the business of the company they were protecting. We researched pricing both with potential customers and other products in our industry to find out if OpEx or CapEx was a better fit. How did they buy today? How would they like to buy? We did market research to understand the verticals and map the right entry point - we were wrong but that doesn't reduce the value of the research. We looked at competitors in depth to understand what they were seeing that we weren't. Dax is right. This is an invaluable document that should be updated every year - the company is changing, the market is changing, there's more feedback about price and ICP. It's not for sharing with the outside world. It's a map for driving forward. Decks won't get you investment - VCs invest in people. We make decks but we know they don't tell our story. The deck is a calling card. Dax and Harry are both right. https://lnkd.in/e25M82xY

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🌍 We are happy to support Wayra who is introducing CVC Office Hours: A New Way for Startups to Access Strategic Guidance 🌍 24 CVCs from around the world have joined forces to define the most pressing areas they want to explore startup technologies for their enterprises' strategic interests. They are offering their time in 121 office hours to startups whose applications showcase strategic collaboration opportunities in their industry. We want to see our startups getting in front of them, which is why we recommend it. Whether you’re looking for fundraising guidance, exploring strategic pivots, or diving into market insights, we recommend applying to the Office Hours and getting connected with experienced CVCs ready to support your journey. 𝗪𝗲'𝗿𝗲 𝗹𝗼𝗼𝗸𝗶𝗻𝗴 𝗳𝗼𝗿 𝘀𝘁𝗮𝗿𝘁𝘂𝗽𝘀 𝘁𝗵𝗮𝘁: • Are in the Late Seed to Series B stage • Have post-MVP traction and an active user or client base    𝗙𝗼𝗰𝘂𝘀 𝗼𝗻 𝗸𝗲𝘆 𝗔𝗜 𝗮𝗿𝗲𝗮𝘀, 𝘀𝘂𝗰𝗵 𝗮𝘀: • Safe AI: Security, transparency, and ethical AI practices • Model Lifecycle and Operational Scalability: Efficient deployment and management of AI models • AI Applications: Solutions for productivity, automation, and sustainability across industries​ 𝗪𝗵𝘆 𝗝𝗼𝗶𝗻 𝗢𝗳𝗳𝗶𝗰𝗲 𝗛𝗼𝘂𝗿𝘀? 🔍 Direct Access to Experts: Get actionable advice from CVCs who understand scaling challenges. 💡 Variety of Topics: Discuss funding, market trends, and strategic shifts for growth. 🌐 Global Connections, Real Impact: Gain insights from a global network to navigate local and international markets. Office Hours is more than a chance to meet investors; it’s an opportunity to gain the strategic insights you need to thrive in a competitive market. 👉 Ready to explore new opportunities? Apply by November 20th and take your startup on the strategic capital journey! See the link in comments Kyle Tsai Bruno Moraes Jake Christoforou

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Allocate just released an analysis on a dataset of 253 venture funds, with only pre-2019 vintage years being included. The analysis shows a clear negative correlation between high risk / high reward investment profiles and size of venture fund, i.e. the smaller the funds, the higher the performance, but also the higher the risk. Two ways that LPs can mitigate the higher risk of smaller funds: 1. Diversify across more emerging managers, and 2. Invest across vintages with said managers. Here are the details: Small Funds (0-100MM): Mean TVPI: 4.3 Standard Deviation: 2.4 Median Portfolio Companies: 26 Mid-Sized Funds (100-250MM): Mean TVPI: 3.6 Standard Deviation: 2.0 Median Portfolio Companies: 24 Mid-Large (250-500MM): MeanTVPI: 3.0 Standard Deviation: 1.2 Median Portfolio Companies: 35 Large (500MM+): Mean TVPI: 2.7 Standard Deviation: 0.9 Median Portfolio Companies: 43

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4️⃣ SaaStock Fundraising Chatter: Finding the Right VC for You. A key takeaway from Tuesday’s post was how important it is to qualify your investors. With so many options, here's how to be strategic: 🔎 Qualify ruthlessly. Treat your investor funnel like a sales funnel. AlbionVC, for example, invests $1-10M in UK-based B2B software and deeptech. If you’re a Paris-based consumer marketplace raising $20M, it’s a non-starter. Founders waste precious time crafting outreach to funds outside their scope. 🥇 Prioritise Smartly. Rank your target funds by both appeal and likelihood of success. 💘 Find a Warm Intro. If you don’t know the fund directly, network like you would for sales. Get a concise, compelling intro via a mutual connection. Remember a “pass” could even lead to a referral to another, better-fit fund. 🎮 Sequence Pitches. Start with lower-priority VCs to refine your pitch with early feedback. Then, approach your top picks with a polished narrative. Generating interest early creates momentum in your process. ⚠️ Requalify Your VCs! It’s as important to assess us as it is for us to assess you. ➡️Ambition Alignment: Are their expectations aligned with yours? ➡️Personal Fit: Grab a coffee, breakfast, lunch, go on a walk: will you enjoy working with them for years? ➡️Support: What do you need? Do your diligence to ensure they deliver it. ➡️References: Talk to portfolio companies, successes and struggles. Were they fair? were they kind? ➡️Partner Stability: The partner who leads your investment will be emotionally and intellectually invested in you and your vision. They will be on call. They will fight for you when things get tough (bridge rounds, etc)…far more than someone who replaces them later. Also, high turnover at a fund could signal cultural issues. #SaaS #Fundraising #VC #AlbionVC

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Elon Musk on how choosing the wrong VC almost killed Tesla "If you have a choice of a lower valuation with someone you really like or a higher valuation with someone you have a question mark about, take the lower valuation." Elon tells part of the story of how he got this wrong when Tesla raised its Series C in 2006. He was choosing between two competing bids from Kleiner Perkins and VantagePoint. Kleiner offered a $50 million pre-money valuation. VantagePoint offered $70 million. Musk told Kleiner that if John Doerr joined the board, Tesla would do it at $50 million. However, John had too many other obligations at the time and couldn't commit to another board seat. Tesla ended up going with VantagePoint, which Musk says, "was probably a mistake". In November 2007, VantagePoint tried to lead a deal that would have seriously diluted Musk's control of the company. That attempt ended up failing. But a year later, VantagePoint almost blocked the deal that saved the company from bankruptcy. In December 2008, Musk needed to raise $40M. One week from running out of money and bouncing payroll, Musk managed to cobble together $20M and asked Tesla's other investors to match it. They agreed, but Musk noticed a problem while finalizing the paperwork. VantagePoint had signed all of the paperwork except for one crucial page. When Musk phoned up Alan Salzman, VantagePoint's cofounder and managing partner, Salzman informed Musk that the firm had a problem with the investment round because it undervalued Tesla. They then backed out of the deal. Musk believed that Salzman's tactics were part of a mission to bankrupt Tesla, oust him as CEO, recapitalize Tesla, and emerge as the major owner of the carmaker. This forced Musk to take another huge risk: Tesla recharacterized the funding as a debt round rather than an equity round, knowing that VantagePoint could not interfere with a debt deal. The deal ended up closing on Christmas Eve, hours before Tesla would have gone bankrupt. Musk had just a few hundred thousand dollars left and could not have made payroll the next day. Musk ultimately put in $12M personally, and the investment firms put up the rest. As for Salzman, Musk said, "He should be ashamed of himself." Musk compares choosing a VC to getting married. It's incredibly important to work with people you respect and trust. Valuation shouldn't be the only thing founders optimize for.

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🤯 𝗡𝗼𝘁𝗵𝗶𝗻𝗴 𝘀𝗽𝗮𝗿𝗸𝘀 𝗮 𝗩𝗖’𝘀 𝗶𝗻𝘁𝗲𝗿𝘀𝘁 𝗹𝗶𝗸𝗲 𝘁𝗵𝗲 𝗽𝗿𝗼𝘀𝗽𝗲𝗰𝘁 𝗼𝗳 𝗿𝗲𝗷𝗲𝗰𝘁𝗶𝗼𝗻… 🏃🏻‍♂️ Suddenly, doubts over founding teams, valuations, market sizes and lack of traction evaporate, doors get busted in and blank term sheets are eagerly slid across the table. When VCs sense competition, unexpected dynamics come into play. Just a touch of FOMO in your fundraising approach can make all the difference—I've witnessed it countless times. 🧠 𝗝𝗼𝗶𝗻 𝗺𝘆 𝗺𝗮𝘀𝘁𝗲𝗿𝗰𝗹𝗮𝘀𝘀, "𝗧𝗵𝗲 𝗔𝗿𝘁 𝗼𝗳 𝗙𝘂𝗻𝗱𝗿𝗮𝗶𝘀𝗶𝗻𝗴," 𝗮𝗻𝗱 𝗹𝗲𝗮𝗿𝗻 𝗵𝗼𝘄 𝘁𝗼 𝗹𝗲𝘃𝗲𝗿𝗮𝗴𝗲 𝘁𝗵𝗶𝘀 𝗽𝗼𝘄𝗲𝗿𝗳𝘂𝗹 𝘁𝗼𝗼𝗹 𝗶𝗻 𝘆𝗼𝘂𝗿 𝗳𝘂𝗻𝗱𝗿𝗮𝗶𝘀𝗶𝗻𝗴 𝗲𝗳𝗳𝗼𝗿𝘁𝘀. Check the link in the comments for more details!

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How to navigate a YC Series A term sheet (so many of you have asked for this post) "How do you handle Series A fundraising?" "What are the key terms to watch out for?" "Can you break down the YC term sheet?" The short version is: Read carefully :) The long version? 1. Securities Offered → Series A Preferred Stock 2. Investment Amounts → Lead and other investors contribute 3. Convertible Notes → Convert into shadow series preferred stock 4. Valuation → Post-money, includes option pool 5. Liquidation Preference → 1x non-participating; sale = liquidation 6. Dividends → 6% noncumulative, paid if declared 7. Conversion Rights → Convertible to common stock, 1:1 ratio 8. Voting Rights → Preferred Majority approval needed for key decisions 9. Drag-Along Rights → Founders, investors, 1% stockholders support sale 10. Other Rights → Anti-dilution, transfer, registration, pro-rata, info rights 11. Legal Fees → Company covers up to $30,000 for lead investor 12. Board Composition → Lead investor appoints one director; common shareholders two 13. Founder and Employee Vesting → Standard 4-year schedule with 1-year cliff 14. No-Shop Clause → 30-day restriction on alternative financing Will this post be helpful for you? I don't know. All I know is every time I post about "how to navigate a YC term sheet", people appreciate it. Join thousands of founders and VCs who receive these insights in my biweekly newsletter at https://lnkd.in/e8tUxsTk And follow 👉 Igor Curic, CFA, MBA for more content like this!

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Series A Engineering: How does Dreamcraft Ventures support startups towards a successful Series A? 🚀 Find out in our Bits & Pretzels Masterclass in Munich on 30 Sep, which will be hosted by Nico, Founder Enablement Partner, and yours truly 🙌 We will cover how we invest and support portfolio companies. Using Hiber as a case study, I will talk about our collaboration with Michael and his team, and give you insights into how they raised their $15m Series A led by EQT Ventures 🤩 Nico will do a deep dive into crucial building blocks for early-stage startups. Based on his +15 years of experience from VC-backed startups like Trustpilot and Platypus, which he co-founded, Nico will provide hands-on advice for hiring, creating structural trust, retaining talent and building a performance culture 💪🔥 Are you going to Bits & Pretzels? Then join our Masterclass or reach out to myself, Nico or our colleague, Mads, if you want to meet up elsewhere! 💬 #Bits24 #venturecapital #vc #startup

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The market is evolving… In Q1 and clearly in April we are talking to more and more startups focused in getting their ducks in a row for a Q3 & Q4 fundraising / exit push. Why is that: ✅ There is more appetite from investors to deploy capital in 2024. ✅ There is more confidence that valuations have reached their floor and are starting to increase. ✅ Startups have managed to ride out this challenging period and are now producing the type of metrics that investors will require. ✅ Startups have extended runway as long as they can but now need to bite the bullet. ✅ More mature profitable businesses are looking to secure a partial or full exit. We are not out of the woods yet and obviously a lot of firms are still battling to survive but getting the financial ducks in a row is critical to execute within the appropriate timelines that the business needs. If you are ready to plan for this year or the start of next, then drop me a note and we can discuss your options in identifying a market leading CFO or Finance Leader for your business. 👍

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Germany and Europe need a lot more technical founders and we need to build a second & more technical ecosystem. 🏗 I just published a column in German outlet Gründerszene / Business Insider where I argue the following: 1. 👨‍🔧 Technical Founders are a massively lacking Europe is lacking the generational tech giants which the US or China have produced. The often quoted reasons are lack of Series B+ capital, fragmented European markets or regulation. The often overlooked factor is that those generational companies in the US are largely built by people with strong technical backgrounds whereas in Europe we see a lot less technical founders. I.e.: Of the top 10 market cap companies today in the US, 7 are tech companies. Of those, ALL have been founded by people with technical backgrounds. For European Unicorns only 26% have technical co-founders - and in most cases then not in the CEO role. That difference is staggering! 2. 🔁 This is a flywheel that has organically grown We have built a great and functioning flywheel especially around people with more business backgrounds. A lot of the venture successes in Europe and Germany in particular of companies started in the mid-2000s were built in the archetype of "two business school graduates hire first CTO to help them build company" as opposed to the "Two Stanford computer science graduates get together and build company". Then as a number of those companies turn successful the flywheel starts spinning: The next generation of people with business backgrounds has role models to emulate, has relevant network of angels and entrepreneurs and investors invest in things that look like past successes and so it becomes a self-reinforcing cycle. This flywheel just does not exist to the same extent for technical founders yet. Case in point: In Germany I would argue that probably >80% of VCs are German and have business backgrounds whereas in Berlin >80% of software engineers come from abroad. 3. 🎉 The future is bright Firstly the fact that we are only just getting started on the technical founder ecosystem is great news because it means our ecosystem is still at Day One and we have enormous potential. More importantly - the gap to the US is closing. The demographics of graduates are changing: Computer science graduates since 2010 have doubled in Germany and more importantly the perception of computer science degrees is changing. Computer Science is finally no longer viewed as a choice for "the nerds" but we increasingly see talent go down this path that 10-15 years ago would have chosen to study the more established paths of Business/Law/Medicine/etc... And last but not least do we start to see really meaningful technical ecosystems emerge, especially around the Technical University of Munich. Many thanks to Nina Anika Klotz from Gründerszene! Link to the full article (in german) here: https://lnkd.in/esXCTByd

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I hear a lot of chatter about VC fund sizes these days in the industry. Many funds have most likely outgrown their deployment capacities in terms of size - but keep on raising even larger vehicles. But why? All comes down to the most common business model in place, called "2 and 20". For every dollar committed, the fund charges its investors a flat fee of 2% per year to pay for "operational expenses". As team sizes are not proportionally growing with Assets under Management, this also significantly increases overall personnel budgets, allowing the managing partners and team to take home a (high) fixed, so performance-insensitive salary. Performance is factored in via the "and 20" component of the business model, called "carried interest", or "carry", and means that for every dollar returned beyond the initial commitment (and, sometimes, a hurdle rate), the investors/LPs will get 80 cents, while the team banks in 20 cents. In the past, when it was way harder to raise mega funds, fund managers had to deliver extraordinary returns to their investors to go home post-economic (via carry) - the ZIRP era and ever-increasing fund sizes have enabled a totally new, almost risk-free business model of "management-fee funds" though. Curious to see how those management-fee funds will eventually perform in the long-term and in a repeated game - and whether and how LPs will move their attention and appetite to sub 100m or even sub 50m funds, where eventual financial success of the endeavour of the team is solely attributable to outperformance and the entitlement to carry.

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🚀 SaaS Startups and Monthly Recurring Revenue (MRR): The Secret to Long-Term Growth🚀 - SaaS startups have transformed how businesses operate, and Monthly Recurring Revenue (MRR) is the backbone of their success. - Here’s why MRR matters and how SaaS founders can leverage it for sustained growth: 1️⃣ MRR: The Lifeline of SaaS Startups: - Predictable and stable income allows SaaS companies to: Plan for future growth confidently. - Attract investors by showcasing steady revenue streams. Prioritize building an MRR-focused business model for financial resilience. 2️⃣ Why Customer Retention is King: - Acquiring new customers is 5x more expensive than retaining existing ones. - Retention increases Customer Lifetime Value (CLV) and reduces churn. - Build strong customer relationships by: Offering exceptional support. - Continuously improving your product based on user feedback. 3️⃣ Upselling and Cross-Selling: Boost MRR: - Identify opportunities to upsell premium features or cross-sell complementary services. - Loyal customers are more likely to invest in additional offerings—maximize this potential! 4️⃣ Focus on Product-Led Growth (PLG): - A seamless product experience drives organic growth. - Invest in user-friendly interfaces, self-service options, and compelling free trials to attract and retain customers. 5️⃣ Data-Driven Decision-Making: - Track metrics like churn rate, net revenue retention, and average revenue per user (ARPU) to make informed decisions. - Use these insights to refine your strategy and ensure consistent growth. ✨ For Founders: - The road to SaaS success is built on retention, innovation, and customer value. - Prioritize MRR as a key metric, listen to your users, and focus on creating long-term value for sustainable growth. ----------------------------------------------------------------------------------- If this post resonates with you, Share ♻ & follow Shilpi Kumari for insights on investment, startup fundraising, founder grooming and startup updates. 👉🏻 P.S. Let others know your thoughts in the comment section!!! #SaaS #startups #MRR #customerretention #growthstrategy #startupmentor #ingrainscapital #founders #investors

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public SaaS multiples, measured by market valuation against annualized current run-rate ARR, have now reverted to levels seen around 2016. for me, this suggests that the market may have hit rock bottom, opening up opportunities for growth (link to the report is in the comments). the elevated multiples observed during COVID, driven by the expectation of a permanently virtual and remote work setting, are gone for good, though.

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📊 EV/Revenue Multiples Above Pre-COVID Averages, Despite Higher RatesThe software sector's EV/Revenue multiples have shown remarkable resilience, remaining above pre-COVID averages even in the face of rising interest rates. As of now, the software EV/Revenue multiple stands at 6.6x, surpassing the pre-COVID 5-year trailing average of 6.1x. This is a significant increase from the 3.6x average during the 2001-2007 period when the 10-year Treasury yield was around 4.5%.🔍 Key Insights:Current Multiple: 6.6x Pre-COVID 5-Year Average: 6.1x 2001-2007 Average: 3.6x (with a 4.5% 10-year Treasury yield) Despite the economic challenges and higher interest rates, the software sector continues to command strong valuation multiples. This trend underscores the sector's robust growth potential and investor confidence.📈 10-Year Treasury Yield Trends:The 10-year Treasury yield has fluctuated significantly, impacting valuation multiples across sectors. Currently, it hovers around 4.25%, reflecting broader economic conditions and monetary policy adjustments. The resilience of software EV/Revenue multiples highlights the sector's enduring appeal and the market's optimistic outlook on its future growth prospects. Having said that if companies do experience a slowdown we can and should expect to see a more dramatic pull back in valuation levels. #Software #Valuation #EVRevenue #MarketTrends #Investment #Finance #EconomicInsights Source: KeyBanc Analysis

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One of the funnest and intellectually entertaining podcasts I have heard in recent times. Riveting episode featuring many provocative quotes by Delian Asparouhov who says it like he sees it, and Harry Stebbings pushes back hard (the one on US v Europe was a highlight). I particularly enjoyed the passages on what a junior VC can do to succeed in venture (do the stuff a GP or senior VC cant do, says Delian), as well as on Founders Fund and how it is run incl decision-making on ICs. Delian seems to both hate and love Benchmark. He cant stand what Bill Gurley did to Travis Kalanick, yet the admiration for Benchmark, likely the closest in style to Founders Fund (small close-knit team, not Blackrock of venture that Sequoia and A16Z have become) comes through. Younger VCs will find the section where Delian describes how a junior VC can succeed in venture particularly interesting. Delian recalls how he flew to Portugal on short notice to meet the Sword Health founders, and did the deep research to understand their IPs and then convinced the Khosla Ventures team to back them. "Harry: What are your single biggest lessons on how to succeed in the world of junior VC? Delian: [00:23:00] if I, if I were to sort of boil down, I think what the success ultimately, you know, um, came down to, It was just a willingness to do things that the GPs weren't willing to do….one line mantra is extraordinary careers when you're a junior in venture do not get built sitting behind a desk in an office and, you know, behind a laptop. you have to be willing to go meet with founders in person, figure out how to, you know, sort of understand their businesses and how to convince them to even spend time with you when you're not, you know, one of the big generals.....And you have to be willing to do those types of things as a junior VC and gamble on this sort of top of funnel aperture, you know, on opportunities in a way that, the GPs are not, you know, I always say.” More notes of what I found interesting at https://lnkd.in/gzsvKdZU Link to episode: https://lnkd.in/g_C2Tzjj

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Something many exit-seeking SaaS founders do not seem to consider: SaaS valuations are all about the present value of future cash flows. 💸💸💸 Unless your growth is exponential, showing positive cash flows in exit talks with investors (vs. merely breaking even) puts you in a much better position. Evidence >> Crystal gazing 🔮

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This Sequoia Capital article is easily the best article I have read on product-market fit. (link below) Its very relevant to (disruptive) deep tech startups, a category I often feel is ignored in these articles. 3️⃣ There's three methods to get to PMF, and the largely depend on the nature of the product and the perception of the market: 🔥Hair on Fire: Customers are acutely aware of the problem and actively looking for solutions. Success hinges on delivering the best-in-class solution through differentiation. [Smartphone market, after the iPhone] 🪨Hard Fact: Customers acknowledge the problem as an inevitable fact of life and haven't actively sought solutions. The challenge lies in convincing them that there's a better way and overcoming inertia. [Uber/ AirBnB] 👀Future Vision: Customers are either unaware of the problem or believe a solution is unrealistic. The entrepreneur needs to create a new paradigm and win over customers to this vision. [Apple iPhone/ OpenAI] Each of these have different approaches, as the nature of problem to be solved is different. 🔥Hair on Fire: Act fast and prioritize a great product with a strong go-to-market strategy, usually with a unique insight, because if its a hair-on-fire problem, there are likely existing competitors. [Rippling, the HR software did it unified HR Database for businesses] 🪨Hard Fact: Educate the market about the problem and how your solution offers a better approach. [Square had to do this to overcome the cash-only mentality] 👀Future Vision: Be prepared for a long journey, focus on attracting top talent, and find strategic pit stops for commercial traction along the way. [Nvidia did this with gaming chipsets] So which type of problem is your startup solving?

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