Insoo Chang’s Post

In the world of fundraising, the debate over financial models is ongoing. According to entities like Techstars, believes that a solid financial model showcases a founder's strategic acumen in understanding business growth mechanisms. However, some investors, especially those beyond Silicon Valley, view financial models with skepticism. They may see them as a fixation on minor details or a lack of awareness about the inevitability of pivots in the startup journey. Reasons to Forego Financial Models: Initial plans evolve rapidly in response to customer feedback. Time spent on projections could be better used for immediate learning. Projections are often wildly inaccurate. Business dynamics can change dramatically, rendering initial assumptions obsolete. Investors Look for: Investors seek founders who understand the entrepreneurial journey, prioritize effectively, and embrace the evolution of plans. Detailed financial projections at the pre-seed stage may not convincingly demonstrate these qualities. Utility of Financial Models: Jenny sees financial models as tools to assess a founder's understanding of incentives and value drivers and their agility in seizing opportunities. Differing Perspectives: Investors' preferences vary based on location, ecosystem maturity, and investment strategy. While pre-seed investors may want comprehensive models, Silicon Valley investors often prioritize exceptional teams in promising markets. The Reality: Each investor has unique evaluation criteria. Understanding their priorities, seeking insights from past founders, and aligning your approach accordingly are crucial steps in finding the right investor for your startup's vision. #finance #venturecapital #vc #startups

Where can you find smart money? I sat down for an interview with Kieran Powell from Channel V Media to discuss my investment philosophy, strategies, and the lessons learned from early failed investments. We also looked at the evolving role of Venture Capital and Private Equity investors in a rapidly evolving tech market, exploring how burgeoning technologies like AI and machine learning are transforming subsectors like clean tech and agri-tech, which are pivotal industries in the drive towards sustainability. This was fun, so check out the complete interview in the link below. #investment #privateequity #tech #VentureCapital #BlackNovaVC

📉 𝗩𝗲𝗻𝘁𝘂𝗿𝗲 𝗖𝗮𝗽𝗶𝘁𝗮𝗹𝗶𝘀𝘁𝘀 𝗥𝗲𝘄𝗿𝗶𝘁𝗶𝗻𝗴 𝘁𝗵𝗲 𝗣𝗹𝗮𝘆𝗯𝗼𝗼𝗸 𝗳𝗼𝗿 𝗢𝗽𝗽𝗼𝗿𝘁𝘂𝗻𝗶𝘁𝘆 𝗙𝘂𝗻𝗱𝘀 📉 With soaring valuations and a sluggish IPO market, VCs are facing a tough decision: reinvent their opportunity funds or scrap them entirely. 1️⃣ 𝗜𝗻𝘃𝗲𝘀𝘁𝗼𝗿 𝗗𝗲𝗺𝗮𝗻𝗱 𝗦𝗵𝗶𝗳𝘁𝘀: Many LPs are pushing back on traditional opportunity funds, viewing their top startups as overvalued and overly capitalized, with no clear path to liquidity. The IPO slowdown is reshaping demand. 🚪 2️⃣ 𝗥𝗲𝗼𝗿𝗶𝗲𝗻𝘁𝗲𝗱 𝗦𝘁𝗿𝗮𝘁𝗲𝗴𝗶𝗲𝘀: Some VCs, like Lightspeed, are shifting away from doubling down on existing portfolios. Instead, they’re eyeing secondary stakes, LP fund positions, and even turnarounds, aiming for diverse avenues of potential return. 🔄 3️⃣ 𝗔𝗯𝗮𝗻𝗱𝗼𝗻𝗲𝗱 𝗖𝗮𝗽𝗶𝘁𝗮𝗹: In extreme cases, firms like CRV are even returning portions of raised capital, acknowledging that high valuations dampen follow-on potential. This bold move highlights the challenges and changing priorities within the industry. 💼 4️⃣ 𝗦𝗲𝗰𝘁𝗼𝗿-𝗦𝗽𝗲𝗰𝗶𝗳𝗶𝗰 𝗧𝗿𝗲𝗻𝗱𝘀: Despite widespread caution, fields like generative AI are still attracting robust opportunity fund support due to the high costs of innovation and LP interest in next-gen technologies. 💡 🚨𝘞𝘪𝘭𝘭 𝘵𝘩𝘦𝘴𝘦 𝘴𝘩𝘪𝘧𝘵𝘴 𝘭𝘦𝘢𝘥 𝘵𝘰 𝘢 𝘮𝘰𝘳𝘦 𝘳𝘦𝘴𝘪𝘭𝘪𝘦𝘯𝘵 𝘢𝘯𝘥 𝘢𝘥𝘢𝘱𝘵𝘪𝘷𝘦 𝘝𝘊 𝘭𝘢𝘯𝘥𝘴𝘤𝘢𝘱𝘦, 𝘰𝘳 𝘢𝘳𝘦 𝘰𝘱𝘱𝘰𝘳𝘵𝘶𝘯𝘪𝘵𝘺 𝘧𝘶𝘯𝘥𝘴 𝘢𝘴 𝘸𝘦 𝘬𝘯𝘰𝘸 𝘵𝘩𝘦𝘮 𝘣𝘦𝘤𝘰𝘮𝘪𝘯𝘨 𝘰𝘣𝘴𝘰𝘭𝘦𝘵𝘦? 🤔 Interesting! [𝐋𝐢𝐤𝐞] 👍 Helpful? [𝐑𝐞𝐩𝐨𝐬𝐭] ♻ Insights on this subject? [𝐒𝐡𝐚𝐫𝐞 𝐛𝐞𝐥𝐨𝐰] 💬 Do not want to miss the next post? [𝗙𝗼𝗹𝗹𝗼𝘄] 🔔 Nexus Capital Middle East 𝗦𝗼𝘂𝗿𝗰𝗲: PitchBook, Michael Bodley, Statista, Voronoi 📢 𝗗𝗶𝘀𝗰𝗹𝗮𝗶𝗺𝗲𝗿: This post is for informational purposes only and reflects personal opinions. It is not intended as investment advice. Always conduct your own research or consult a financial advisor before making investment decisions. #NexusCapitalME #VentureCapital #OpportunityFunds #Innovation #GenerativeAI #InvestmentStrategy #AlternativeInvestments Jason Gibb Damian H.D. Conway Vitor Moreira Nogueira

🚀 𝗨𝗻𝗽𝗮𝗰𝗸𝗶𝗻𝗴 𝗦𝘁𝗮𝗿𝘁𝘂𝗽 𝗩𝗮𝗹𝘂𝗮𝘁𝗶𝗼𝗻𝘀: What investors really look for in this high-stakes game. As the funding landscape evolves, understanding startup valuations has become more crucial than ever for both founders and investors. 𝗜𝗻 𝘁𝗵𝗶𝘀 𝗗𝗲𝗲𝗽 𝗗𝗶𝘃𝗲, 𝘄𝗲 𝗲𝘅𝗽𝗹𝗼𝗿𝗲: 1️⃣ Key drivers that shape a startup’s valuation in today’s market 📊 2️⃣ Why comparable company analysis and discounted cash flow aren’t the full story 🌱 3️⃣ The impact of industry trends and macroeconomic shifts on investment decisions 💡 ✨ 𝗪𝗵𝘆 𝗧𝗵𝗶𝘀 𝗠𝗮𝘁𝘁𝗲𝗿𝘀: Understanding these factors equips you to negotiate better terms and spot opportunities that others might miss. Ready to gain a new perspective on valuations? Read the full article here: 👇 https://lnkd.in/eeckfXvK

𝗦𝘁𝗮𝗿𝘁𝘂𝗽 𝗩𝗮𝗹𝘂𝗮𝘁𝗶𝗼𝗻: 𝗨𝗻𝗱𝗲𝗿𝘀𝘁𝗮𝗻𝗱𝗶𝗻𝗴 𝘁𝗵𝗲 𝗕𝗮𝘀𝗶𝗰𝘀 Understanding startup valuation is crucial for founders preparing to raise capital. This guide outlines the essential frameworks and methodologies to help you build confidence and clarity in discussions with investors. Key highlights include: 1️⃣ Pre-Money vs. Post-Money Valuation: Learn how to calculate and differentiate between valuations before and after investment. 2️⃣ Dilution Dynamics: Understand how equity distribution changes with each round and its impact on ownership. 3️⃣ Valuation Methods: Explore methodologies like the VC method, Berkus method, and Risk Factor Summation to assess your startup's worth. 4️⃣ Market Factors: Discover how market conditions, industry trends, and team composition influence valuation. PS. check out 🔔 for a winning pitch deck the template created by Silicon Valley legend, Peter Thiel https://lnkd.in/ejp-Bhnu

What VCs Really Want to See: The Core 4 Metrics Aumni analyzed over 10’00'0 data points to find out what metrics investors actually want to see. When it comes to securing venture capital, four key metrics stand out as essential across all stages of a startup's growth. These "Core 4" metrics give VCs a clear picture of a company's health and potential. Revenue: Revenue remains the top and most consistently sought-after metric across all stages of investment. Net Burn Rate: This shows how quickly a company is spending its cash reserves, crucial for understanding sustainability. Full-time Employee Headcount: Indicates growth trajectory and resource allocation, reflecting how well a startup is scaling. Gross Margin: A critical measure of profitability, showing how efficiently a company turns revenue into profit. KEY TAKEAWAYS VCs prioritize revenue, but as startups mature, their focus shifts from survival metrics like cash runway to operational efficiencies. Understanding these metrics is key to aligning with investor expectations at every stage. Subscribe to ‘Siliconnector’ Telegram channel for insights and news from Tech world and Silicon Valley: https://t.me/siliconnector

What's the true state of fundraising? 📊 Here's what the data tells us: 🌱 Pre-Seed Snapshot: Median valuations around $11M with typical raise sizes at $1.2M. The pre-seed segment remains highly active. 🌱 Seed Rounds Rebound: $3.7M raised on a median $14.8M valuation. Deal volume lower but valuations high. 📈 Growth in Series A, B, & C: Series A rounds report $10.8M raises on $43M valuations. Series B funding dips to $22.9M on $116M valuations. Series C rounds scarce, with $30M raises on $258M valuations. In summary, software companies see valuations climbing back to 2021 levels, especially at pre-seed and seed stages. Series C rounds are the hardest to secure in this capital climate. Join thought leaders from VCs like a16z, Accel, Index, Sequoia, and more via Data-Driven VC to dive deeper into the full story. 🚀 #DataAnalysis #startup #VentureCapital Follow me Mel Zimmerman for more insights!

Lately, I’ve been reflecting on how the overall market shifts have changed What VCs are Really Looking For Right Now. I’ve had a lot of conversations with founders about the new quantitative benchmarks VCs look for. In many ways, that’s the easy part. Either you’ve reached the quantitative milestone or you haven’t. But what often doesn’t get shared, are the other factors that are the REAL sticking points in partner meetings. The things beyond the numbers behind how VCs are making investment decisions. And as the market has shifted, there’s been an evolution in those investment frameworks. So I want to share some reflections on how I’ve seen the landscape change, how Harlem Capital’s investment framework has evolved, and what it means for founders right now.

How do VCs find unicorn investments? All sourcing relies on a mix of inbound and outbound strategies: Inbound: ⬅️ Share your thinking publicly ⬅️ Connect with earlier-stage investors ⬅️ Pay attention to referrals from other founders Outbound: ➡️ Research sectors of interest ➡️ Track promising research papers ➡️ Build a scout network Read the full piece on sourcing unicorn investments:

🌅 New horizons for the funding landscape? Our managing partner, Alokik Advani shares his views on the current VC landscape and tips for founders looking to raise in today's environment. Drawing from the lessons of past bubbles bursting, questions arise. Will down rounds become a viable option? What insights can be gleaned from previous market corrections? And what are the silver linings here? Read the full article below 👇