In 2011 a Stanford computer science student Lucas Duplan founded a startup named Clinkle. It was supposed to develop a mobile payment app, similar to Apple or Google Pay.
Clinkle had a secret sauce: they wanted to use ultrasound waves for communication between a phone and a Point Of Sale device in a store (POS). Apple Pay and Google Pay took a different approach. These apps use Near Field Communication (NFC), which relies on short-range electromagnetic transitions, for connecting phones with POS devices.
Clinkle raised $30 M from a number of prominent investors. 4 years later the company was shut…
In a context of venture investment, Due Diligence (DD) is defined as “the process by which investors explore a company that they are thinking of investing in” (see Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist). Another way of looking at DD is “making sure what you are buying is what you think it is” (see Scientific due diligence: A handbook for investigators and investors).
During the DD process a VC would usually assess a startup’s leadership team, check the company’s technology and IP, verify customer demand, analyze competitive landscape, take a close look at the company’s financials…
According to Crunchbase data, the number of startups created every year is steadily declining since 2016. At the same time, both the number of investment deals and the total amount of cash powered into startups were growing, so the problem was not on the monetary side. How do we explain this phenomenon?
My fellow Californians deeply care about climate change. 80% of us view global warming as a serious threat to the state’s future economy and quality of life. So far the state has been a leader in implementing policies aimed at preventing global warming.
But do we really understand the practical implications of climate change on our individual lives? When I talk to my friends (most of whom are from the software industry), they are all concerned about warming, but this concern is mostly abstract — theoretical. Once we start discussing details, apparently everyone gets surprised by what they learn when…
CrunchBase contains information about 72,735 companies with a solo founder, 0.26% of them are unicorns. There are 4,877 companies with 4 founders, 0.82% of which are unicorns. So, 4-founder teams have way better chances to build a unicorn, but they are 15 times less frequent than 1-founder teams.
Note: This article is based on CrunchBase data, retrieved on September 10, 2019. As CrunchBase gets frequent updates, you will see slightly different numbers when you follow the links above.
More detailed analysis confirms the trend. …
One of the most widespread rules of thumb in the venture industry is about the number of startup founders. It implies that an optimal number of founders is 2 or 3, startups with a solo founder are OK-ish, startups with 5 or more founders are rotten. Is this belief based on a solid foundation? It’s not. CrunchBase data indicates the opposite: the more founders a startup has, the better its chances are to raise money and have an exit.
An elevator pitch is an essential element of the Silicon Valley communication culture.
It’s a short description of your startup, designed to spark an interest in a stranger. The stranger is expected to be a potential investor, customer, journalist or some other person of interest. The pitch must be short yet contain all the important information about your company. You should be able to use it to summarize your business plan on the back side of a business card. Or, to communicate it within 20 seconds to an investor whom you’ve ambushed in an elevator.
Pitching inside an actual elevator…
A popular quote says: “Talent is equally distributed around the world, opportunity is not”. But the quote talks about the past, not the future. The past was filled with global inequality and unfairness. What does the future hold? Can the tech companies change it for better?
An imbalance prompts an arbitrage. A chance to make the world a better, fairer place, is also a chance to make money.
How exactly do we want to tackle the talent/opportunity imbalance? There are 3 major scenarios to address:
If you are a startup founder, you’ve been there: A welcome reception at a conference. You are mingling with a glass of wine, bumping into random people, small-talking for 3 minutes, and moving to the next person with whom you’ve just made an eye contact. A Brownian motion of human beings who spend an hour exchanging business cards.
3x entrepreneur (1 exit), Microsoft/Intel alumnus, author/speaker/adviser