Ritesh Kumar’s Post

Investing in early-stage startups is risky. Which is why angels or VCs are looking for outsized returns from a small percentage of their portfolio. They need to see the big dream and the potential for huge success. But it's not just about the dream. Post-2021, the capital environment has changed. Investors now look for founders who can execute in the short term. Proof points and a clear plan for immediate execution give them confidence that their money will be well-spent and that you won't need more funds soon after. So, here are two things I recommend startup founders focus on: 1. Showcase the Dream - Articulate the big idea and its potential impact. Make it compelling and show how it can deliver significant returns. 2. Demonstrate Short-Term Execution - Provide proof points that you can achieve short-term goals. Have a clear plan showing how you'll use the investment to reach immediate milestones. Make sure that you demonstrate a balance in both aspects. Your pitch should convey that you're not just a visionary but also a doer who can make things happen. #StartupFundraising #VentureCapital #AngelInvesting

In venture-backed startups, cofounders have a strict definition. People who do this, get double digit equity. Nobody else does. Here is the definition: They are full-time, committed for the next decade, and critical to the business. People who were there from the beginning aren't cofounders by default. Part-timers aren't cofounders, yet. At least their vesting shouldn't start yet. Part-timers that never want to be full time? Advisor with 1% or less. Aren't committed for a decade? Equity from the employee option pool. Put money into the business? You are an investor not a cofounder. You would be suprised how many times startups blur the line between founder, early hire, advisor, and investor and mess everything up. If you happen to do both, or move from one to the other, be very clear via which track you earned what equity. They are not the same. #startups #founders #venturecapital

Let's talk equity for founders: For those of you don't know Cash Allred, he's got some incredible insights and has done a lot for the startup community by providing some incredible information. Here's his sweetened condensed version of how to dish out equity as a founder. For the more thorough explanation, check out the comments for a YouTube link with even more insights 👇👇 #equity #founders #startups #antler #venturecapital

The delicate balance between running out of cash and raising too much, startups face a pivotal challenge in their journey to success. Again Everyone! Murli Ravi sheds light on the potential pitfalls in both scenarios, emphasizing the critical importance of strategic financial management for startup longevity. Read the valuable insights here: https://lnkd.in/gQzpqRTK

There’s a growing conversation in the VC space about the importance of realistic valuations, and for good reason. In an insightful piece from TechCrunch, Elizabeth Yin of Hustle Fund discusses why startups should carefully consider valuation offers, rather than simply taking the highest one available. In a competitive funding landscape, it’s tempting to go for big numbers, but this can lead to high expectations and long-term challenges, both for founders and their teams. Our approach is centered on providing not just capital, but also strategic guidance and hands-on support to foster your growth by collaborating closely with entrepreneurs. If the topic peaks your interest, find the TechCrunch artilce here: https://lnkd.in/dgA--jJ2 #VC #StartupGrowth #Valuations #Innovation #Funding

This perfectly sums up one of my frustrations with VCs investing in early stages making it difficult for angels to effectively invest in early stage startups. The seed stage has blurred to pre-seed, post-seed, peach seed, mango seed, and whatever other kind of seed you want to name. When VCs invest too early in a start up, they also require more process and rigour than what is helpful for founders to be nimble and focus on getting to product, market, fit. We are seeing a lot of downrounds right now along with major cap table restructurings as a result of too much dumb money going in at the early stages. DC Palter

As DC Palter and Terri Hanson Mead have experienced these challenges as being part of the VC and Angel Investing side of Life Sciences, we at SVA Life Sciences have also encountered too many early stage startups that have received generous VC & Seed funding but have no real plan to efficiently and effectively use it. Hiring talent, or more importantly these days deploying purpose-built, data-driven technology that won't deplete their funds, is key to preserving and stretching your capital investment. An eye towards scalability is critical, not to mention the use of AI. We at SVA call it finding the "Easy Button" from our years of experience helping companies on their Commercialization Journey. DM me to avoid adding to this frustrating experience, and let us help you find the early startup, Easy Button. #VCinvestingfrustrations #Seedstagedifficulties #SVALifeSciences #CommercializationJourney #EasyButton

🚨 How Stuck is the Startup Exit Market? 🚨 Startup exits—when investors or founders cash out their equity stake in a startup by selling the company or going public—are crucial for investors to see returns on their investments. 💸 Without exits, investors’ money stays tied up, which means fewer returns for them and less funding available for new startups. 🫣🛑 PitchBook’s latest report shows just how serious the slowdown is: 📉 Cash returns to limited partners (the people who fund VCs) have dropped to levels not seen since the global financial crisis. 🚨 The number of VCs and angel investors investing in startups this year is just 45.5% of 2021 levels. 💡 VCs are sitting on unicorns valued at $2.5 trillion, but nearly 40% of these have been in their portfolios for 9+ years! And the backlog of companies awaiting exit? A record-breaking 57,674—with late-stage companies making up 32.4% of those. It’s a big pressure point for the startup ecosystem. Want to read more about this? Check out this super quick read: https://lnkd.in/eQi53vBS What are your thoughts? Let me know in the comments. 💬 #MatthewGlickLegalServices #StartupAttorney #CorporateAttorney #TechStartupLawyer #DealFramework #BusinessNegotiation #LegalTerms #LegalAdvice # #EmploymentLaw #LegalUpdates #StartupAdvice #Venture #VC #Exits

Why Startups Struggle to Raise Seed Funding 🚀 Raising a seed round can be tough. Here’s why many startups miss out on that critical first funding: 🔹 Unclear Value Proposition – Investors need a clear problem-solution fit. If they can’t see the impact, they won’t invest. 🔹 Small Market Size – Seed investors look for big markets with growth potential. Niche markets can deter them. 🔹 Weak Team – Investors value strong, well-rounded teams. Gaps in skills or experience create doubt. 🔹 No Traction – Early user growth or pilot results show validation. Without some traction, investors hesitate. 🔹 Unrealistic Financials – Projections that don’t add up reduce confidence. 🔹 Crowded Market – Entering a saturated space without a clear differentiator is risky. 🔹 Poor Pitch – An unpolished pitch can overshadow a good idea. Tackling these head-on can help startups stand out and gain investor confidence. 🌱💰 #seedstartup #fundraising #seriesA #venturecapital

"In our research, we define the mighty middle as startups that have a feasible path to reaching valuations in the high single-digit millions to high tens of millions within 5-10 years". The 'mighty middle' businesses can often be a safer investment with more measurable returns that looking for that 'once in a million' unicorn investment. Setting up for it is not necessarily as easy as it sounds though. Scaling a business brings structural, financial, growth strategy and management hurdles to a business often still controlled by passionate founders solving the business and world problems they set out to address. These new hurdles weren't part of the original business idea and can be the downfall of many a good venture. https://lnkd.in/gRjgJR5w