Investor Connect Podcast

I receive requests for introductions from many sources. Startups want to meet investors. Advisors want to meet growth companies. The list goes on.

Over the years, I’ve learned to raise the bar. I could take whatever attachment they have and make the introduction. Instead, I raise the bar by requiring the requestor to make it better. I ask for a proper email address that represents their business instead a hotmail address. I ask the requestor to write a short paragraph about the purpose of the introduction. If they don’t have a focus, then I ask them to find one before sending it.

I’m happy to make an introduction. I want it to be successful. I’m surprised by how many drop out after I ask for a short note explaining the reason for the introduction that I can use in the followup.

If you want an introduction, then provide a few sentences describing the purpose of the introduction and why you are asking for it.

If you ask for an introduction, offer something in return or pay it forward.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!


Direct download: Startup_Funding_Espresso_--_Raise_the_Bar.mp3
Category: -- posted at: 9:29pm CDT

I was recently talking with a startup who had a photo service.

He spent $3K to test out his business model. He found he could sign up one photographer for every dollar spent and how much revenue he could generate with each one.

As he spoke, I found myself engaging with his pitch when he had numbers. He talked about how he spent his $3K to demonstrate the cost of customer acquisition and the average lifetime use.

Later in the discussion, I found my eyes glazing over when he started talking about how “everyone loves this service.” “It works great.” and other statements that spoke generally about the product but not specifically about the business.

With investors, anecdotes tell, but numbers sell.

Use numbers when you talk about your business. Demonstrate your expertise and the results of your research with specific facts.

Show the unit economic numbers around your business model and make the case that you have a business that works.

Make sure you don’t show up with general anecdotes as you may see the investors interest wane.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!


Direct download: Startup_Funding_Espresso_--_Anecdotes_Tell_Numbers_Sell.mp3
Category: -- posted at: 9:50pm CDT

Every startup has one key metric to grow their business to the next level.

The one key metric for mobile app businesses is user engagement with the app.

This measures how much time or how often the user engages with the app.

The user needs to engage on a regular basis and over time increase the usage.

Some focus on total number of users but if most of those users don’t use the app more than a few times, then there’s no way to grow the business and later monetize.

Others focus on downloads but this too fails to measure activity that leads to growth and monetization.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_Mobile_Apps.mp3
Category: -- posted at: 10:53pm CDT

Your One Key Metric: SaaS businesses

Every startup has one key metric to grow their business to the next level.

For a software as a service business it is the CAC: LTV ratio

CAC standards for Cost of Customer Acquisition and represents the cost of signing up the customer including marketing, sales, and any other related expenses.

Lifetime value and stands for the total amount of revenue from the customer. This is typically calculated by looking at the churn rate which is how many customers are dropping out each month.

The metric compares CAC to LTV.

A base ratio of 1:3 indicates a business model that is successful. In this example for every $1 spent on acquiring the customer the customer is spending $3 on the service.

For venture funded companies the ratio needs to be 1:5 or better

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_Your_One_Key_Metric_for_SaaS_Businesses.mp3
Category:general -- posted at: 10:11pm CDT

Every startup has one key metric to grow their business to the next level. 

The one key metric for network effect businesses is organic vs. paid users.

The share of organic users relative to paid users should increase over time because as the network expands, more users want to join. Users can come from those who are friends and contacts of other users.

For two-sided marketplaces, users can come from both the supply side as well as the demand side.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_Your_One_Key_metric_--_Network_Effects.mp3
Category: -- posted at: 9:18pm CDT

Every startup has one key metric to grow their business to the next level. 

In applications requiring FDA certification, revenue is not the key metric, but rather FDA approval is.

For medical device companies the key metric is cycle time through the 510K application and approval process. 

The purpose of a 510k submission is to demonstrate that your medical device is at least as safe and effective as an existing medical device on the market today.

The cycle time for approval varies based on type of device and ranges anywhere from 50 to 300 days.

Your key metric compares your performance against the standard cycle time for your type of device.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_One_Key_Metric_Medical_Device_1.mp3
Category: -- posted at: 8:22pm CDT

In this episode, Hall welcomes Kerry Rupp, General Partner at True Wealth Ventures. True Wealth Ventures is an early-stage venture capital fund run by women. They invest in women-led companies with products and technologies in the sustainable consumer and consumer health sectors that more efficiently solve the next generation of challenges. They believe that because women make the vast majority of consumer and healthcare purchases, having them on the management team designing, marketing, and servicing products is extremely beneficial.

In this episode, you learn more about Kerry’s background before early-stage investing. Right out of college she went into coding which was short-lived but got her into the tech space. She then spent 20 years in the early-stage-technology space working at early-stage companies. In her career, she has worked with everything from product management, biz dev, marketing, strategy, apps, and sales. She partnered up with former business associates to run one of the first accelerators in the market and fell upon investing in startups. They did not set out to create a venture fund next to an accelerator but realized they knew a lot about which startups were good and needed funding. The right model for the accelerator was to create an investment vehicle. It sprung out of the accelerator and was the right thing to do at that time.

Direct download: Kerry_Rupp_of_True_Wealth_Ventures.mp3
Category: -- posted at: 3:44pm CDT

Every startup has one key metric to grow their business to the next level.

For consumer product companies selling through retail, the key metric is same-store sales.

You track ongoing sales by units per store each week or month.

This metric tracks your organic growth rate of the product and can range anywhere from 1 to 10% month over month.

If selling online the CAC: LTV ratio applies which is the cost of customer acquisition compared to the lifetime value. This is the same as recurring revenue companies.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_One_Key_Metric_--_CPG_Sales.mp3
Category:general -- posted at: 8:43pm CDT

In this episode, Hall welcomes Sasha Shtern of Zero G Capital. Sasha is a seasoned entrepreneur with deep ties to the Denver startup community, and known for investing and operating companies in manufacturing, construction services, and technology. In addition, Sasha is the co-founder of Rocky Mountain Blockchain and co-organizer of Ethereum Denver, one of the largest blockchain organizations in the region. Sasha got his start as an entrepreneur at an early age in eCommerce, and gradually build on that success investing in the community.

Sasha talks about some of the investment opportunities in the Midwest and Mountain West, and how determining valuation is key, particularly when talking about startups across different regions. He explains how the differential in valuations between the middle of the country and the coasts can create opportunities for startups and investors. Sasha emphasizes the importance of capital efficiency and using early earnings to generate initial growth. He also discusses how there are fewer barriers to starting a business, and what that means for investing. Finally, Hall and Sasha discuss how the best founders can transition from being a technician to a salesperson and be good at both.

Direct download: Sasha_Shtern_of_Zero_G_Capital.mp3
Category: -- posted at: 5:23pm CDT

Every startup has one key metric to grow their business to the next level. 

For eCommerce, the key metric is sales conversion rate. Your conversion rate is the percentage of visitors who make a purchase. 

For most sites, the conversion rate is 1 to 5 percent. You can find it manually by dividing the number of people who bought a product by the total number of visitors.
In many sites, there are micro-conversions going on throughout the site that lead to a purchase. For instance, a user clicking on a product on a category page is a microconversion, because it takes the customer down the path to a sale.
You can use these smaller conversions to better understand your overall conversion rate.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_Your_One_Key_Metric_--_eCommerce.mp3
Category: -- posted at: 10:15pm CDT

In this episode, Hall welcomes Vickie Zisman, Owner at Bastet Communication. Vickie is a skilled corporate communications professional. She has led corporate activity in marketing, marcomm, events, as well as investor/partner/international relations. She has worked in corporate PR, digital media & social networks as well as the cross-cultural business environment in the private and non-profit sectors. Her background in marketing and communications has put her in contact with entrepreneurs and eventually led to her making introductions and connections between startups and investors.

Vickie speaks about her experiences with startups and investors and their contrasting points of view. She emphasizes that, for most investors, technology needs to be market-ready, and able to be translated into a solid business. She also highlights the importance of personal chemistry and shared vision between startup and investor, and a healthy partner relationship. Vicki also talks about the characteristics of the Israeli startup market and provides advice for investors looking into that space. Finally, Vickie explains how she achieves the best deals possible between both startups and investors, as well as what she sees as the biggest hurdles affecting today's startups.

Direct download: Vickie_Zisman_of_Bistet_Communications.mp3
Category:general -- posted at: 4:36pm CDT

The first vision of a business may seem grand and clear.  Upon launching the business you’ll find it doesn’t exactly fit with the market so you pivot. 

It takes 3 pivots to get to the growth phase of your startup.  

The first is the Target Market pivot-- you take this when you find the right market.

You then have to change your business model to fit the economics of that new market.  I call this the business model pivot in which you find the right way to structure your business.

Next comes the Team pivot-- finding the right people to grow and run that new business model.

The originally envisioned business almost never is the one that takes you all the way to a growth stage. 

You’re three pivots away from it.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_Youre_Three_Pivots_Away.mp3
Category: -- posted at: 6:31am CDT

In this episode, Hall welcomes Brian Deutsche, Founder of XV Capital Group. XVVC focuses on seed-stage investments across industries in the US.

Before XV Capital, Brian was a CPS by trade with a focus on chemical manufacturing. Brian then went on to grad school to get an MBA to transition into the world of investment banking where he was an M&A advisor in the world of consumer and retail. There was a focus on food, beverage, multi-site, retail, and direct-to-consumer. Brian helped early-stage businesses with their positioning and preparing for their fundraising. That's what led to his passion to be more deeply involved in the world of early-stage companies and now investing in them.

Direct download: Brian_Deutsch_of_XV_Capital_Group.mp3
Category: -- posted at: 3:55pm CDT

Before you launch your fundraise, you’ll need to build some basic documents for pitching the investor and following up their due diligence.

Start with a basic pitch deck, ten to 12 slides, that includes a non-confidential introductory version of your deal.

For first presentations to an investor, keep it simple and focused on the core. The goal is not to tell the investor everything. Instead, tell him the key value points in your deal, along with basic details such as how much you are raising, and what you are going to accomplish with the funds.

You’ll also need a terms sheet that an investor can sign to join the fundraise. You want to be able to take funding when offered. If you don’t have a lead investor yet, then start with a convertible note with a standard discount rate, interest rate, and cap rate.

For your diligence box or what some call a dataroom, you should gather your documents regarding articles of incorporation, entity filings, patent filings, income statement, balance sheet, and 3-5 year financial projections.

With these basic documents in hand, you are ready to engage investors.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_What_documents_do_you_need.mp3
Category: -- posted at: 8:48pm CDT

In this episode, Hall welcomes Josh Chapman, Managing Partner of Konvoy Ventures. Konvoy Ventures is an early-stage venture capital fund that focuses exclusively on video gaming & esports.

Josh has a background in finance and has worked at both BlackRock and Morgan Stanley. He decided that he wanted to use those skills and be a life cycle company. He then decided to get into the venture space and launch his firm.

According to Josh, Konvoy is entirely focused on investing in technology startups behind video gaming and sports. He says there is also a large need for focused investment capital in the industry. Konvoy is incredibly excited about the future of video gaming. They've gone from 100 million people in 1995 that played video games to now north of 2.6 billion people that play. That breaks down between about 2.1 billion on mobile, 1.1 billion on PC and about 700 million on game consoles. The future is very bright for the industry.

Direct download: Josh_Chapman_of_Konvoy.mp3
Category: -- posted at: 4:42pm CDT

I’m often asked where startups should look for funding. There are many sources.

First, start with your family and friends, as they already know you and believe in you.

Second, expand the circle to include current and previous coworkers.

If accelerators are appropriate for your deal, then consider those not only in your geographical area but also in your sector. Most accelerators take companies from across the country. Many are now offering funding of $150K or more.

Third, look for a local network of angel investors.

Fourth, ask around for family office investors in your area. These are high networth individuals who have organized their startup investments into a formal process.

Finally, approach venture capital, but only if you have a deal that fits the VC funding model, which looks for a 10X return, a scalable business model, strong growth and an experienced team.

There are literally tens of thousands of investors in the startup world today. The key is to gain an introduction, make a pitch, and then follow up to close.

In summary, it’s best to start with those you know and use their funding to show support and momentum to those further out in your network.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_Where_to_look_for_funding.mp3
Category: -- posted at: 9:41pm CDT

In this episode, Hall welcomes Paul Sethi of 2048 Ventures. Paul is a co-founder and Managing Partner at 2048 Ventures. For 7+ years prior to 2048 Ventures, Paul was CEO of Redbooks, leading sales data and intelligence platform for the marketing industry (acq. by List Partners - May 2018). He also co-founded Robuzz, an advanced ML/NLP practice, with a real-time alerts and data extraction engine built for enterprise.

Paul has been a first-check angel for over a decade, including in Flexport, SeatGeek, Transfix, Knotel and LearnVest. He serves as an Advisor to Transfix and OpenFortune. Early in his career, he was a public company investor focused on the tech sector.

2048 Ventures is an early stage venture capital firm. They invest in exceptional first-time entrepreneurs who are building businesses differentiated through technology. Based in NYC, and invest in founders from New York, Boston and Emerging Tech Cities.


Direct download: Paul_Sethi_of_2048_Ventures.mp3
Category: -- posted at: 4:12pm CDT

For early stage funding there are several types of investors.

Angel, VC, Family office, or customer funding.

So which type is right for your deal?

This depends on your type of business, the return and timeframe for that return.

VCs want standard business models in high growth sectors with a 10X return in seven years.

Angels want 3 to 5 times their money in 3 to 5 years and have capital preservation in mind. They often look at businesses in non high-growth sectors.

Family offices are not time sensitive and can be very patient money but do expect outsized returns for that patience. They will also look at businesses in non high-growth sectors.

Potential customers are also candidates to fund your deal by pre paying or buying customized versions of your product. While this is not an investment, the cash earned works like funding to build your business.

In launching your fundraise, consider which investor fits your business type, return, and timeframe.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: _Startup_Funding_Espresso_--_What_type_of_investor_should_you_seek.mp3
Category: -- posted at: 9:31pm CDT

In this episode, Hall welcomes Michael Mealling and Steven Jorgenson of Starbridge Venture Capital.

Michael co-founded Masten Space Systems, was CTO of Seraph Group (a seed-stage VC fund), is the CEO of the Waypaver Foundation, and the President of the Moon Society. He has helped build several startups over the years ranging from telecom consulting to social media.

Steven is a founding partner of the Space Finance Group, Quantum Space Products, Space Angels Network, and Integrated Space Analytics. Steven is also an active angel investor in numerous other aerospace startups, giving him valuable personal experience as both the Investor and the startup Entrepreneur, as well as extensive experience as a professional investment fund manager.

Starbridge Venture Capital is a venture capital fund focused on the overlap between the space technology sector and traditional technology investments. There is true innovation happening across multiple sectors of space science and technology and at a pace that is quite obviously accelerating.

Direct download: Michael_Mealling_and_Steven_Jorgenson_of_Starbridge_Venture_Capital.mp3
Category: -- posted at: 5:08pm CDT

There are two primary deal structures for your startup fundraise.

There’s the convertible note which is a debt instrument that converts to equity later. However, if you want to use a straight debt instrument you should use a promissory note.

Then there’s equity. It gives ownership rights in the company. The ownership is set by the valuation put on the company. An equity deal often comes with additional terms such as board seats, voting rights, and more.

Most startups use the convertible note to kick off their fundraise because it doesn’t set the valuation of the company which drives how much the investor gets for their investment.

You will find setting valuation is a major step in the fundraise process.

Until there is a lead investor and the valuation is set, there will be many investors who want to “just be in the deal,” but not spend time setting the valuation.

At some point in the fundraise an investor will express interest in joining but wants equity. If they are investing $100K or more, then they are a candidate to be the lead investor.

After the equity investment is made, the convertible notes convert into equity.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_-_What_Deal_Structure_Should_you_Use.mp3
Category: -- posted at: 6:12pm CDT

In this episode, Hall welcomes Grant Newlin of Newlin Ventures. Grant started his career as a management consultant at UI, before moving to investment banking, M&A, financial planning, and eventually working in food tech with Kraft Heinz. He ultimately started working with New Stack Ventures doing angel deals, before founding his firm, Newlin Ventures.

Grant talks about how the angel and VC investment worlds have changed in recent years, and what excites him about the food tech space, whether it is in CPG, agricultural, restaurants, or software. He explains how food tech differs from other traditional tech businesses, particularly when it comes to fixed costs and volume. Grant also talks about how funding for food tech companies often follows a different roadmap than other startups, and how getting positive gross margin in the beginning is key. He touches on how the food tech space has evolved, and what role the larger CPG giants and small startups are playing. Grant discusses his investment thesis in the food tech space, and some of the technical and regulatory challenges to expect. Finally, Grant advises would-be startups and investors in food tech to five some consideration to building in-house to ensure product control.


Direct download: Grant_Newlin_of_Newlin_Ventures.mp3
Category: -- posted at: 3:04pm CDT

Every day I ask entrepreneurs how much they are raising.

Most begin with the big number--the full and complete raise they anticipate to run. This ranges usually between $1m and $10M.

It’s good to have the big picture in mind.

Some actually consider raising it all at once because “they want to get the fundraising out of the way.” I remind them that raising too much money on a round will cost you equity that you don’t have to give up.

Your valuation is low at the beginning. It’s best to raise only the funding you need to reach the next milestone, and no more. As you grow the business, your valuation will go up and you’ll give away less equity.

Consider breaking your fundraise into tranches. It will save you time and make each fundraise easier.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_How_much_should_you_raise.mp3
Category: -- posted at: 6:37pm CDT


In this episode, Hall welcomes Reed Berglund of iSnap. Reed is a tech startup advisor and CEO of iSnap, a SAAS company with a platform that is helping businesses collect customer video stories and gauge customer satisfaction. As an advisor, Reed supports a portfolio of the company's capital, content, time and experience. The current portfolio of companies includes S4M and Hanna Essentials.

Reed was CEO and Co-Founder of Fullbottle whose company was one of the early entrants in influencer marketing across on Instagram, Facebook, and Snapchat. A marketplace for creating and acquiring visual content from photos to videos from creators around the Globe.

Direct download: 01_Reed_Berglund_of_iSnap.mp3
Category: -- posted at: 2:50pm CDT

Competitive advantages increase revenue by 30% over the competition or decrease cost by 30%.

Virality is a key competitive advantage in which users invite other users to join your platform.

Virality reduces your cost of customer acquisition. It’s is different from Network Effects. Network Effects shows the platform increasing in value based on more users participating.

I once had a CEO tell me “I wish I had designed for virality rather than revenue.” If you build virality into your product, you will have a larger pool of prospects to monetize as well as a lower cost of customer acquisition.

For you next project, consider designing for virality.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_Five_Competitive_Adv-Virality.mp3
Category: -- posted at: 10:52pm CDT

In this episode, Hall welcomes Ciarán Hynes, co-founder and Managing Partner at COSIMO Ventures, a deep technology firm specializing in Blockchain. With over ten years of deep tech market experience, Ciarán leverages his extensive network of investors, advisors, government agencies and business leaders throughout the U.S. to bring strategic benefits to these organizations.

In this episode, you’ll learn Ciarán's background before COSIMO Ventures. He has founded over seven companies, was the CEO of five and had several successful exits. In the process, Ciarán met Robert Frascar, and they worked on several startups together. Finding they had instant chemistry and worked well together, they formed COSIMO five years ago. As a reflection of the founders’ entrepreneurial background, COSIMO Ventures looks at companies from an entrepreneurial perspective and brings that knowledge to their portfolio

Direct download: Ciaran_Hynes_of_COSIMO_Ventures_1.mp3
Category:general -- posted at: 4:39pm CDT

A competitive advantage increases revenue by 30% over the competition or decreases cost by 30%.
Most businesses increase in value as the customer base grows and validates the product/service. Users encourage others to join the platform. This is called Network Effects.
As the number of users grow, so the value of the platform grows as well.
If a business can harness that customer base and turn it into a community that more aggressively attracts other users then it’s a competitive advantage.
Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.
Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_Five_Competitve_Adv_-_Network_Effects.mp3
Category: -- posted at: 9:37pm CDT

In this episode, Hall welcomes James Somauroo of HS. Ventures. James is a Founding Partner at HS. Ventures, which build, scales and invests in the best health tech startups. James is a health tech contributor for Forbes and hosts the HS. Health-Tech Podcast, which is listened to in 80 countries. He’s an anesthetics and ICU doctor by training, he’s held roles in leadership, management and innovation at NHS England, Health Education England and the British Medical Journal and previously directed an accelerator that provides startups with market access to the NHS, saving £48M for the UK health service. James holds degrees in biomedical sciences and education and is a guest lecturer on health tech innovation and entrepreneurship at University College London.

Direct download: James_Somauroo_of_HS.Ventures.mp3
Category: -- posted at: 4:30pm CDT

Competitive advantages increase revenue by 30% over the competition or decrease cost by 30%.

A platform-based solution is a competitive advantage over a single-product company, as a platform brings an inherent cost advantage.  

Platforms reuse the research, design, architecture, and product packaging.

Customer support is also reused.

Consider adopting a platform-based approach to your business. 

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

In this episode, Hall welcomes Kevin King, Managing Director of Texas Halo Fund. Texas Halo Fund (THF) is an investment company that specializes in investing in early-stage businesses with promising growth prospects and exceptional management teams. Their investment approach identifies compelling businesses from multiple sources and without regard to the industry or geographic location. They seek the best opportunities to generate the highest returns for investors with the lowest possible risk. Each fund invests in multiple companies in a variety of industries to construct a diversified portfolio.

Today, you’ll learn about Kevin’s background before Texas Halo Fund. He’s been in the startup industry for most of his career and has successfully run 10 early-stage businesses. Kevin advises would-be investors to have a definite plan of approach before writing a check, and not to just invest in something interesting without a little due diligence. Kevin suggests investors challenge themselves to build a portfolio of ten to twelve companies. For startups seeking funding, Kevin advises persistence and flexibility. As he explains, startups often must do a little of everything. For that reason, having a rigid approach (the "I have a skill set in a certain sector and that's what I'm going to do" mentality) can lead to unfortunate surprises when you're running an early-stage business.

Direct download: Kevin_King_of_Texas_Halo_Fund.mp3
Category: -- posted at: 5:10pm CDT

Competitive advantages increase revenue by 30% over the competition or decrease cost by 30%.

Recurring revenue is a key competitive advantage.

In today’s world you would think every business has recurring revenue. Yet, I find most businesses who are raising funding did not structure their business for recurring revenue.

Recurring revenue helps your business in several ways.

It opens up your business to new customers who could not afford your product previously because the one-time payment was too high. By breaking the payment into smaller steps, more customers will be able to afford it.

It provides an ongoing revenue stream so you can plan your business better as you know how much you will have coming in.

It helps you maintain engagement with the customer and gives you the opportunity to find new opportunities to serve the customer. 

Overall it should increase your revenue in the long run by at least 30%.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_Five_Competitive_Advantages_--_Recurring_Revenue.mp3
Category: -- posted at: 11:12pm CDT


In this episode, Hall welcomes Stephen Meade of MonetaPro, a B2B sell-for-credit exchange using blockchain technology to deliver better efficiency, liquidity, and trust to global trade. Stephen is an entrepreneur, executive, and founder who has built numerous successful technology companies over the past 20 years.


Stephen talks about how he entered the FinTech space and the importance of blockchain technology. Stephen advices that investors in the blockchain space should consider equity or a blended offering rather than token offerings alone - in other words, consider sacrificing some liquidity for better long-term control and value. He explains how companies are moving towards using blockchain on the funding side, while also highlighting those that are using blockchain technology as part of a product or service. In addition, he discusses some of the regulatory developments in blockchain, and how the challenges for startups remain fundamentally the same - acquiring customers and raising capital. Finally, Stephen expands on the role of MonetaPro, how they fit into the FinTech space, and where they are going from there.

Direct download:
Category: -- posted at: 2:23pm CDT

A competitive advantage increases revenue by 30% over the competition or decreases cost by 30%.

Channel access is a key competitive advantage. Channel access lets you connect to a set of customers that others cannot.

Perhaps your previous job gave you contacts throughout the industry that you can now leverage for your startup.

Perhaps you have found a social media channel, SEO, email, or other marketing channel that works well. It may take some experimenting to find that channel but now you have something your competition does not.

In your pitch to investors, you want to highlight this as a key differentiator. It may not be a sustainable advantage for the long haul, but it can be crucial to launching your startup.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_Five_Competitive_Advantages_--_Channel_Access.mp3
Category: -- posted at: 8:07pm CDT

In this episode, Hall welcomes Gary Madsen of ProTransit Nanotherapy. Gary Madsen, Ph.D., has over 30 years of experience in developing and launching biotechnology products in a wide variety of markets at companies of various sizes. He spent 17 years at Abbott Laboratories in product support, new product development and business development. His expertise in product commercialization has helped him to success building new technologies; today that has led him to a promising new technology -- nanoparticle drug delivery.

Gary advises that potential investors in biotechnology make sure that the technology is workable, scalable, and that it has good supporting data beyond just slick advertising. Gary explains some of the technology behind nanoparticle drug delivery, and its potential applications. In addition, Gary touches on why skincare is a good entry point for new technology, as well as some of the technical challenges in scaling production. Finally, Gary outlines some of things that ProTransit has done to set themselves up for success as they pursue additional applications for their technology.

Direct download: Gary_Madsen_of_ProTransit_Nanotherapy.mp3
Category: -- posted at: 4:15pm CDT

In raising funding you need to find investors. So how do you get in front of them?

First, identify the right type of investor and build up your network in that area. 

Know your sector, stage, and revenue category and look for those who invest in it. If your target investor funds  biotech then you should skip pursuing investors who fund fin-tech. 

Second, start building a list of your target investor group.

Target specific people and not firms or funds. Compile a list of 20 investors and start building a relationship with them.

Third, start connecting with them online and in person.

In emailing, start with an introduction of who you are and what you’re all about and how it is relevant to them.

You need to bring something to the investor in addition to the ask for funding.

If you have a contact making an email introduction, provide them a short two paragraph summary. Include the following:

-Who you are - demonstrate experience and credibility

-What you are doing - make it interesting

-Why you want to connect - is it about an investment, advice, feedback, etc.

Don’t make your contact do all the work because they won’t be able to provide that information. Write it up for them.

In meeting them in person, bring something interesting to the discussion such as new information about a sector, company, or group that may be useful to the them. It could also be the latest research you have done on a topic of interest.

Keep the dialog going until you build a rapport with the investor.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!


Direct download: Startup_Funding_Espresso_--_How_to_get_in_front_of_investors.mp3
Category: -- posted at: 10:26pm CDT

In this episode, Hall welcomes Djalil Reghis of Agroecology Capital. Agroecology Capital is a mission-driven early-stage venture fund that invests in technologies that help agriculture transition toward practices focused on safety, sustainability, productivity, and equitability. Djalil is an AgTech early-stage investor with an experience that spans roles in investment, M&A, Government Affairs, and Board Director. He has held key roles in implementing $1B of strategic international investment projects with a focus on consumer packaged goods. 

In this episode, Djalil talks about how technology is transforming the Ag space, and is helping push Agroecology’s principal values. He also explains how the AgTech space remains a small, nascent market, where sharing between investors in important. He explains how a technical, specialized knowledge is key to unlocking value and potential.

Direct download: Djalil_Reghis_of_Agroecology_Capital.mp3
Category: -- posted at: 2:46pm CDT

Entrepreneurs are often enchanted with the idea behind their business that they think investors will write them a check based on the idea alone.

Many have great ideas but I always say no matter how great your idea is standard startup metrics apply.

New technologies can capture the imagination such as blockchain in 2017 that sent startups through a hyper funding phase, but this only lasts for a short time. Today standard startup metrics apply.

Some have a rockstar team and think that will make the fundraise a slam dunk. But again, I say standard startup metrics apply.

Standard startup metrics means you have a platform setup with users on it and line of sight to revenue. You have market validation and product validation - the user likes the product and will pay for it at some point.

You too may be excited about your idea, product, team, or more but standard startup metrics apply

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!


Direct download: Startup_Funding_Espresso_--_Standard_Startup_metrics_Apply.mp3
Category: -- posted at: 10:04pm CDT

In this episode, Hall welcomes Stephanie Campbell of Houston Angel Network and The Artemis Fund. Stephanie is the Managing Director of the Houston Angel Network, one of the most active angel networks in the country. She is also Managing Partner at the Artemis Fund, the first female-founded, female-focused venture fund in Houston, Texas. The Artemis Fund is investing $20M in 15-20 female-led US-based companies that disrupt the Consumer Tech, Life Tech, Fin-Tech, and Energy Infrastructure industries.

Stephanie explains how Artemis Fund focuses on companies that make a difference in the world, solve real-world problems, and solve problems for overlooked communities. She provides advice for female founders and investors and talks about the investing world from a female perspective. She touches on some of the challenges startups face and emphasizes the importance of understanding your customers and how to get to them.

Direct download: Stephanie_Campbell_of_Houston_Angel_Network__The_Artemis_Fund.mp3
Category: -- posted at: 4:23pm CDT

When I ask an entrepreneur what their competitive advantage is, most point to their product and say it's better. Of course, they spend ten minutes citing anecdotal stories to “prove” it.

My definition of a competitive advantage is that it increases revenue by 30% over the competition or is a decrease in cost by 30%.

Here are five sources of competitive advantage:
- Channel access
- Recurring revenue
- Platform based solution instead of singular products.
- Network effects in action -- the value of the product increases with the number of users
- Virality -- users invite other users -- it’s not the same as network effects

These advantages give your business the ability to scale. Scale comes from revenue increasing faster than cost.

In raising funding, competitive advantages can make the difference in closing an investor. The key is to quantify the effects of your advantage in dollars. If you just say you have it then it will convince no one. You must demonstrate with numbers.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: 291_--_Startup_Funding_Espresso_--_Five_Competitive_Advantage.mp3
Category: -- posted at: 9:58pm CDT

In this episode, Hall welcomes Manuela de Paula of Babel Ventures. BABEL Ventures is a VC firm based in Silicon Valley that focuses on investing in early-stage startups founded by antifragile entrepreneurs. They focus on innovation and technology, partnering with revolutionary startups.

In this episode, Manuela shares how she got into investing before Babel Ventures. She also shares what she finds most exciting at the moment. According to Manuela early-stage companies and their technology can change the world for good. They’re not only interested in profits. They have a focus on humanity. They're making and building to create solutions to help and to do something big that will improve people's lives.


Direct download: Manuela_de_Paula_of_Babel_Ventures.mp3
Category:general -- posted at: 4:34pm CDT

When I started angel investing over twenty years ago, there were angels, venture capital funds, and accelerators. That was about it. Today there are many more investor types in the early stage funding arena.

Here’s my experience with the investor types including how much they invest and what they expect as a return in general:

Crowdfunders -- Invest $500 to $2500, expect 2X to 3X their investment in five years

Pre-Revenue VCs -- Invest $150K, expect 3X their investment in three to five years

NanoVCs -- those who have a $10M fund,  Invest $100K on the first check and expect 5X their investment in five years

MicroVCs -- those who have a $25M to $50M Invest $150K on the first check, and expect 5X their investment in five years

Traditional VCs -- Invest $150K to $500K on the first check and expect 10X their investment in seven to ten years

VCs with Accelerators  -- Invest $150K to $250K on the first check and expect 3X their investment in five years

Incubators/Accelerators - Invest $25K to $150K, expect 3X their investment in seven years

Angels - Invest $25K to $50K, expect 3X to 5X their investment, in five to seven years

HNI -- Invest $100K, expect 10X their investment in five years

Family Office -- Invest $250K, expect 5 to 10X their investment in five to ten

Hopefully this helps you identify the right investor for your startup.

Let’s go startup something today!

Direct download: 290_--_Startup_Funding_Espresso_--_the_Many_types_of_Startup_Investors.mp3
Category: -- posted at: 12:04am CDT

In this episode, Hall welcomes Rufo Guerreschi CEO and Founder of Rufo is an entrepreneur, activist and researcher in the area of leading-edge IT security and privacy. As a founder of startups and NGOs over the last 20 years, he has strived to radically advance the state-of-the-art of security and privacy of private digital human communications and transactions. is focused on building an ultra-secure social computing platform, that brings real privacy and security to consumers. core philosophy boils down to its untrusting approach to design, fabrication, and software.

Direct download:
Category: -- posted at: 3:20pm CDT

How Investors can find an exit in a Startup Investment.

One of the challenges for investors funding startups is finding the exit.  

Startups typically exit through an IPO or an acquisition by a larger company.

As a startup  investor you have little to no control over the exit and can end up in a deal for ten years or more. 

So how can an investor find an exit?

The solution is to define the exit before investing.

Setup conditions to give you the option of exiting at a prescribed time or stage of company.

You can insert redemption rights and clauses into the terms sheet giving a predefined exit and return.

If the startup is not defining the exit, then you should. 

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!


In this episode, Hall welcomes Faris Ghawi of Vytalize Health. Vytalize Health enables primary care providers to enhance the scope of care provided for Medicare patients. Their comprehensive services include in-home, remote and brick-and-mortar care, as well as on-demand urgent care.

Faris provides advice for investors coming into the healthcare space and highlights how the space has changed.  As Faris explains, a successful healthcare technology is about "cutting costs, and capturing savings, and sharing savings out of the value that's created in the system". The emphasis is on creating efficiencies and aligning the economics of all the stakeholders. Faris discusses how and why Vytalize focuses on Medicare, and where they fit into the overall landscape. He also touches on the cost savings goals that a value-based startup should be looking for. Finally, Faris talks about how the value-based healthcare is being received by the larger market.

Direct download: Faris_Ghawi_of_Vytalize_Health.mp3
Category: -- posted at: 4:32pm CDT

I meet a great number of entrepreneurs and have seen numerous approaches to raising funding. Some approach it as an opportunity to meet new people and explore another part of the entrepreneur ecosystem. Others see it as a chore that distracts from the real business such as product development, closing sales, creating the next unicorn (take your pick).  

Some bring their sales skills to the process and are quite good at meeting investors, listening to their concerns, and closing the deal. Others expect the investor to be bowled over by the idea, the pitch deck, the rock-star team (again take your pick). When that doesn’t happen they look at it as a failed meeting.

The key is to bring your best game to the meeting and treat it as you would fishing. 

In fishing you have to set the bait and be patient for the right fish to come along.  

Just like you can't rush a fish to take the hook so you can’t rush an investor.

If you don’t get a bite in one place you can move to another location or you can stay where you are and change the bait.

I see entrepreneurs setting specific time schedules for their raise.  This is the same as casting the line and then saying “By 3:25 we will have our first fish”. The fish rarely work on your schedule. Investors won’t either.

While a fisherman can throw a stick of dynamite into the waters to expedite the process, this is where the analogy ends as you can’t do that with Investors.

Fundraising is like fishing. It can be a joyful experience or a terrible one. It takes the right place with the right bait and patience.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_How_fundraising_is_like_fishing.mp3
Category: -- posted at: 8:05am CDT

In this episode, Hall welcomes Bader Alam of CAVU Venture Partners. CAVU Venture Partners is a consumer-focused investment firm founded by operators, that aims to partner with operators in building high-growth and disruptive businesses. They are partners and operators first, investors second. Bader is the Senior Vice President at CAVU and has over 10 years of private equity experience, focusing on growth equity and middle-market transactions primarily in the consumer sector.

In this episode, Bader shares his thoughts on how the consumer product sector is growing and his advice to those wanting to invest in consumer brands. According to Bader, as an investor, the consumer-product space is interesting because you have a product you can touch and feel, and it's very easy to just have an affinity for a product. It's important to base decisions on all factors, though, and not just on the product itself.

Direct download: Bader_Alam_of_CAVU_Venture_Partners.mp3
Category:general -- posted at: 4:25pm CDT

There are some statements I’ve never heard a startup Investor ever say.

Here are some of them:

No startup investor ever said:

-I hear way too often from that startup that I invested in.

-There are so many good deals to invest in- where do I start?

-The payback on that startup investment came fast.

-Of course the startup hit their forecast- they all do

-I love leading new investments.

-Due Diligence is fun.

What statements would you add to this list? 

Please send me your suggestions and we’ll add them to the list.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_No_Startup_Investor_Said_Ever.mp3
Category: -- posted at: 8:17pm CDT

In this episode, Hall welcomes back Forbes' Top-50 angel investor James Sowers. Since we heard from James last, he has been speaking at several family-office conferences and working with corporations to further educate them on blockchain technology, and whether it is a realistic solution for them. James talks about some of the latest companies he is working with in the blockchain space.
In addition, James discusses some of the challenges in late-stage investing, in particular the problem of valuation. James touches on a few startups he regrets not investing in, and some of the biggest ups and downs he's experienced in startup investing. Finally, James and Hall discuss in depth the current state of the blockchain and cryptocurrency space, focusing on regulatory issues, scalability, and other challenges.

Direct download: James_Sowers_Angel_Investor_follow-up.mp3
Category: -- posted at: 2:55pm CDT

There are some statements I’ve never heard a startup CEO say.

Here are some of them:

-Fundraising just flew by. I didn’t have a chance to really enjoy it.

-Sales is the easiest part of the business.

-All my customers are happy and no one is complaining.

-There are so many good people to choose from for that new position we opened up.

-Why are these terms sheets so simplistic?

-The product features just fly out the door.

-There’s so much revenue, I just don’t know what to do with it all.

What statements would you add to this list? 

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_No_Startup_Ever_Said.mp3
Category: -- posted at: 7:02pm CDT

In this episode, Hall welcomes Mark Lesney of Chilligence. Early in his career Mark worked in the retail-automotive space as Vice President of Operations with a large automotive company that was acquired by the Blackstone Group. Mark had colleagues in the entrepreneurship and startup space and was intrigued. He decided to change paths when his partner's father was going through an acquisition and they saw a need that wasn't being filled yet.

Chilligence was then conceptualized to help make due diligence easier. Whether used by a new business owner or a seasoned investor, they wanted to create a product that would eliminate wasted time, money, and stress from people’s lives. They believe that ideas are about forwarding momentum. Chilligence is designed to never hold back opportunity - instead, they want to help it out along the way.

Direct download: Mark_Lesney_of_Chilligence.mp3
Category: -- posted at: 3:57pm CDT

Raising funding can have the same effect as winning the lottery.

Those who raise funding are both exhausted and exuberant. It’s a big win for the team and promises a brighter future for the company.  Just like the lottery, the sudden inflow of cash can change one’s perspective.  

Be careful to keep your spending in line during the times you are flush.  

A leading angel investor once said, “The IQ of a startup is inversely proportional to the size of their bank account.”

Stick to your plan and don't let the influx of cash lead into mission creep or overpaying for standard services.

Stick with your original goals and don’t let the funding change your spending.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!


Direct download: Startup_Funding_Espresso_--_Lottery_Effect.mp3
Category: -- posted at: 10:53pm CDT

In this episode, Hall welcomes Flavia de la Fuente of BuildGroup. BuildGroup is an operator-led investment company that provides permanent capital to entrepreneurs building the next generation of technology businesses. Their innovative structure allows them to invest for the long term, so founders can focus on running their companies instead of raising the next round.

Flavia started her career as a community organizer at the Sierra Club, where she worked on the organization’s flagship Beyond Coal campaign, before getting an MBA at the McCombs School of Business at the University of Texas. After business school, she worked for four years at the Employees Retirement System of Texas, flying back and forth to Asia to invest in technology stocks and lead an initiative on improving Japanese corporate governance policy. Flavia is a builder and senior associate with BuildGroup. She handles due diligence by going through financials, contracts as well as products and technology to see what makes a company great.

Direct download: Flavia_de_la_Fuente_of_BuildGroup.mp3
Category: -- posted at: 3:58pm CDT

The startup world is open to anybody and it seems like everybody comes through it at some time or another.

I receive calls daily from entrepreneurs who are seeking to start a business, raise funding, or hire a team member.

I can always tell who is the serious entrepreneur and who is the pretend-preneur- someone who likes the idea of running a startup but is not committed to the work required to make it a success.  

That’s important because a pretend-preneur who raises funding will ultimately waste it and there are too many good startups to invest money in those who aren’t going to see it through.

Here are some telltale signs of a pretend-preneur

They are more worried about job titles and credit for the work.

They don’t seem too focused on the customer and what it will take to make them happy with the product as that’s ‘a detail to figure out later.’

They focus on the superficialities of the business and not the core functions of building the product and selling it.

They look for ways around the hard work rather than working their way through it.

Problems are the fault of everyone else and there’s nothing that they can do about it.

They don’t know who their customers are and it doesn’t bother them.

They think funding will solve all problems and life will be easier after the raise.

They don’t know their numbers but someone else in their organization does and that’s good enough.

As an investor, be on the lookout for these signs.

Let's go startup something today!

Direct download: _Startup_Funding_Espresso_--_How_to_tell_if_you_have_a_PretendPreneur.mp3
Category: -- posted at: 10:28pm CDT

In this episode, Hall welcomes Gene Wang, CEO of People Power, a developer of consumer and white-label IoT solutions. Gene is a four-time CEO with a history of successful exits. Gene talks about how People Power uses IoT technology in the clean tech and senior care spaces, among others. He also provides advice for investors looking into the home care sector, and how affordability and simplicity are key for any product in that space.

Gene also touches on some of the technical challenges in the healthcare and home care space, from HIPAA compliance to accessibility. Gene also talks about People Power's current place in the market, and where they are headed in the future, with a focus on caregiver support products.

Direct download: Gene_Wang_of_People_Power.mp3
Category: -- posted at: 3:59pm CDT

In the past venture capitalists stood in the shadows of their successful portfolio companies hinting about their contribution using veiled wording in Twitter posts. Today we see VCs stepping up to take more credit for their contribution. There are numerous examples of VCs using successful exits as validation for their investment thesis.

With the explosion of the number of venture capital providers comes the need for VCs to engage in brand marketing. A list of successful portfolio companies burnishes their brand and helps them gain new deal flow as well as limited partner investors.

Just having a fund is no longer a source of attraction for the best deals- there are too many other funds out there. Today VCs have to position themselves as unique in expertise, dealflow, support, and connections.

VCs need to gain market exposure on their unique value proposition to generate deal flow which is the lifeblood of the VC business model. They are now brand managers who in many cases have a business development and marketing team driving the awareness around their fund.  

As venture capital becomes more abundant, the startup has more choices to consider.  

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Funding_Espresso_--_Venture_Capitalists_Engage_in_Brand_Marketing.mp3
Category: -- posted at: 8:23pm CDT

In this episode, Hall welcomes Max Brickman, Managing Director of Heartland Ventures. Max is an entrepreneur and venture capitalist with a passion for expanding technological innovation into smaller, underrepresented Midwestern communities. He founded Heartland Ventures, a $15mm Indiana-based venture fund, to enhance Silicon Valley startups’ access to this market.

Heartland Ventures is a Midwestern-based, venture capital firm. They co-invest alongside top VCs and Micro VCs to add immediate value to high-growth startups disrupting traditional Midwestern industries. Their value is generated by utilizing our board of executives at industry-leading corporations in the Midwest to validate technologies and acquire pilot customers, even before investing.

Direct download: Max_Brinkman_of_Heartland_Ventures.mp3
Category: -- posted at: 1:48pm CDT

I love startup stories. In the startup world everyone has a grand idea and big plans to make it happen.  It’s the venture world so you better have an idea that can be big. The talk around the idea is large and full of hyperbole. The future is going to be so bright that you find yourself reaching for your shades.

But then the startup has to actually build it and show the growth story in progress. 

Scott Adams once wrote - “Losers have goals.  Winners have systems.’”

If the startup has some revenue traction then they probably have some system behind it that makes it grow. But what if they don’t have any meaningful revenue yet?

One technique is to ask questions that identifies the systems they will put in place such as:

Tell me about your system for generating leads. Exactly how will it work?

Tell me about your sales process. What system are you going to use?

Exactly how do you find the right prospect and close them? 

In other words, the startup needs to do more than just tell you their goals in the slide deck. They need to describe the systems they can put into place to accomplish the goal-.  

If the answers are vague and fuzzy, then they probably haven’t figured it out yet. 

If the answers show expertise and experience, then this one has potential for investment.

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Espresso_--_Everyone_talks_a_big_game.mp3
Category: -- posted at: 9:38pm CDT

In this episode, Hall welcomes Ben Jones of Skipcart. Skipcart is an on-demand last-mile delivery company. Retailers, grocers, and local businesses have the option to give their customers same day delivery by utilizing software and a crowdsourced community of drivers. Ben started out as an entrepreneur working on the service side for large companies before breaking out on his own. Skipcart grew out of the Amazon-Whole Foods acquisition, and the emerging space of grocery delivery.


Ben talks about the competition in the space, and the importance of solid technology and innovation to back up your last-mile delivery startup. Ben also discusses the effect of crowdsourcing and how it drives efficiencies in the space. Finally, Ben also touches on some of the challenges in the space, from getting drivers to adopt a gig-based income model, as well as software that maximizes the efficiency of route-planning to ensure drivers remain loyal to the company.


Direct download: Ben_Jones_of_Skipcart.mp3
Category: -- posted at: 2:20pm CDT

When I look through my LinkedIn network these days it appears every fifth contact is a venture capitalist of one kind or another. When I started in the early stage funding world 20 years ago, the VC was a rare breed who had access to venture funding. Most of them were in a handful of tech clusters in the US - Silicon Valley, New York, and Boston to be exact and they were few and far between.

At that time, a typical VC had a $100M fund or greater which they raised from LPs or limited partners - primarily the pension funds. They operated in ten year funding cycles which means they could run a long ways off one good return. They charged 2% management fees and a 20% carry.

In the 2000s angels grew to prominence because the cost of starting a business came down so much, startups no longer needed $5M to start a web business but could now do the same thing for $500K. Angels became attractive financiers because they were more numerous and easier to access.  Today, MicroVC, NanoVC, Venture Studios and Corporate VCs are coming onto the startup scene with new fund sizes and funding models.

MicroVCs raise $25M to $50M fund while NanoVCs raise $10M to $15M funds.  Aside from the size of their fund, the main difference is that Micro and Nano VCs typically target a narrower criteria- either a specific geography or type of deal.  Many use the pledge-fund model which means each deal the VC wants to fund must go through a screening process by the limited partners.  

Because the fund size is small most MicroVCs are taking 3% in management fees and a 20% carry. Given the size of the fund, they can only invest in 5-10 deals. The fund lasts only a few years before it’s time to raise the next one.  They raise primarily from family offices and high net worth individuals.

Then there is the Venture Studio model. This type of VC essentially builds a team from which they launch a startup with an ecosystem of providers. This works well for one stripe zebra startups that provide niche products or services as they can tie into a bigger team with more resources.  

Finally, there is the strategic or corporate VC which seems to be popping up everywhere.  A venture fund provides a competitive advantage for burnishing the company’s brand and selling its product. They invest for strategic reasons rather than financial ones in most cases. 

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!


Direct download: Startup_Espresso_--_Everyone_is_a_VC.mp3
Category: -- posted at: 8:47pm CDT

In this episode, Hall welcomes Jef Sharp CEO of Qnect. Qnect is an intelligent, cloud-based connection app that gives fabricators, detailers, and engineers fast and flexible connections with significant cost and schedule savings. In minutes, users can connect most steel buildings without capital cost and with minimal initial training. Two important benefits of Qnect include Preference Optimization and Bolt Optimization.

Jef has over 35 years of experience leading and growing tech companies. He has a passion for value creation. Jef is a serial entrepreneur and has co-founded and led many innovative businesses: Qnect (SAAS), Panève (Big Data), Qteros (bio-fuels), Xfinit, (intrusion detection sw), XSCapacity (online exchange for excess capacity), TechCavalry (IT service), and Gravity Graphics (Inc. 500 co) Jef served on the Qteros Board for 5 years, the Panève BoD for 4 years, and is an advisor to PeopleHedge and 5 yr. advisor to Oakridge National Lab.

Direct download: Jef_Sharp_of_Qnect.mp3
Category: -- posted at: 2:48pm CDT

Here are some pointers for startups raising funding

Launching a startup and growing a business is hard.  It's supposed to be hard. 

You need a complete team to start a business – someone building it and someone selling it.  No fair, everyone on the team is building it and no one is selling it.

Being all-in on your startup is step one.  Part-timers need not apply.

Sweat equity is table stakes - not valuation metrics.

Entrepreneurs think investors want big revenue, but what they really want is predictable and repeatable revenue. In an early stage company the revenue is never large, but if it’s predictable based on recurring revenue, repeat revenue or known lead generation funnels, then you have a growth story to tell the investor.

Build and test your funnel so you know it works and can tell the growth story versus telling the ‘we’ll be big someday’ story - which nobody believes.

Funding is an enabler that accelerate what you already have going. Don’t think funding is going to solve all your problems.

Sell it first, build it second. If you can’t sell it in the first place, there’s no need to build it in the second place. Most startups over invest in their tech and then they search for someone to buy it. A better strategy is to sell it and then build out what the customer wants.

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.


Let’s go startup something today!


Direct download: Startup_Espresso_--_Key_pointers_for_starters_raising_funding.mp3
Category: -- posted at: 8:50pm CDT

On this episode, Hall welcomes Anton Golub of flovtec, a financial technology company focusing on providing liquidity for digital assets. After exhibiting a talent for mathematics at an early age, Anton eventually entered the high-frequency trading space, in a research position. Later he began working at a hedge fund, before transitioning to the blockchain space. He talks about riding the surge of interest in blockchain as part of a startup, and how he identified the problem of liquidity with digital assets. This realization led him to start flovtec in 2018.

For potential investors in the blockchain and digital asset space, Anton advises a healthy dose of realism, and an understanding that this space is still at the early stages. Anton discusses the future evolution of the digital asset space, and how the next couple of years should bring clarity-particularly on the regulatory front. He expects tremendous growth in the space of the coming years, and points to several cities that he believes will serve as the hubs for this future growth. In addition, Anton emphasizes that an understanding of the "building blocks" of blockchain is critical to investment success. Finally, he discusses the scalability challenges facing the space.


Direct download: Anton_Golub_of_Flovtec.mp3
Category: -- posted at: 2:06pm CDT

Here are three key pointers for investors who are funding startups.

The team is the most important part of a startup. Diligence should focus first on the team, not the product, space, or anything else.

Monitor the startup for three months before investing to gauge momentum and traction.  You need to peel back enough layers of the onion to know what’s there.  Ask lots of questions -- your mantra should be ‘let’s peel the onion.’

The biggest challenge in angel investing is not that the startup goes under but that it turns into a lifestyle business.  Historical returns indicate that 10% of your investments will be home runs, 15% will be singles/doubles, 10% will go out of business, and 65% will turn into a lifestyle business. 

To avoid your investment turning into a lifestyle business, ask for a redemption right at investor sole discretion.  If they go on the payroll exit, you can exit with the redemption right. 

 The Payroll exit, is when a startup gives up trying to make a go at a venture exit and decides to sit back and just take above market salaries for their exit.  This leaves the investor on the equity exit with no clear path for a return.

 Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!


Direct download: Startup_Espresso_--_3_key_pointers_for_investors_funding_startups.mp3
Category: -- posted at: 10:32pm CDT

In this episode, Hall welcomes Trent Simmons, Founder, and CEO of Bess Corporation. BESS Corporation is a private holding company that specializes in lower market business acquisitions.

At Bess, Trent maintains responsibility for strategic direction, capital allocation, and effective communication across an array of majority-owned businesses. He also maintains direct control of M&A sourcing, execution and investment management. Trent leads family investment positions in real estate, minerals, and securities.

Direct download: Trent_Simmons_of_Bess_Corp.mp3
Category: -- posted at: 3:24pm CDT

Design for virality not revenue

I heard a startup CEO once comment, ‘I wish I had designed for virality and not revenue.’

Virality is a key competitive advantage. The more your users share your information with others the more traffic and sales opportunities you will receive.

Most companies set up their product and website for generating revenue.

They include click here to buy buttons and popups that litter the screen.

Virality tools include sharing your results with others. Offering free and easy access, creating groups and fostering sharing will draw others in.

It’s better to design for virality and have your customers connect their network to you than to simply extract revenue only.  

Virality generates engagement, and engagement leads to revenue. If you don’t have virality, then it takes additional time and cost to create engagement.

If you build virality into the product, then it works for you everyday.

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!


Direct download: Startup_Espresso_--Designing_for_virality_not_revenue.mp3
Category: -- posted at: 7:06am CDT

In this episode, Hall welcomes Jason Jacobsohn, Managing Partner of Propellant Ventures. Propellant Ventures is filling the funding gap with a powerful investment focus on fast growth early stage opportunities. They invest in “Game-Changing” companies with highly attractive valuations across underserved U.S. regions.

Jason has always been an advocate for the entrepreneur. He has provided trusted counsel, guidance and mentoring for many in the entrepreneurial and business communities. Jason has worked with several hundred emerging businesses with services such as investor readiness preparation and coaching, strategic alignment of resources, business development, strategic advisory services, capital formation, and resource development. In addition, he has worked with firms in more than 14 different industries including Internet, software, consumer products, business services, media, and retail.



Direct download: Jason_Jacobsohn_of_Propellant_Ventures.mp3
Category: -- posted at: 2:01pm CDT

10X rule your Startup

Today, we’ll talk about the 10X rule for Startups.

For startups to displace an incumbent, the offer needs to be 10X better than the current alternatives.

So often, startups go to market promising their customer an ROI of 10, 20, or 30% better.

Unfortunately, that’s not enough to win over customers from an established player.  Your startup is an unknown quantity so you have to make a compelling offer.

A 10X improvement comes through cost reduction and increased productivity.

If I launch a product that is 5X cheaper and provides 5X more value, then I am offering a 10X improvement.

If your business is struggling, then ask yourself, “how is my offering 10x better than the competition?”

If the answer is, ‘I don’t know’ then that may be part of the challenge you have in closing customers.

Try this. Imagine your product is 5X cheaper and 5X better than the competition? What would it look like and at what price?

Now you have a vision of what to build and how to price it.

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Espresso_--_10X_rule_for_startups.mp3
Category: -- posted at: 7:03am CDT

In this episode, Hall welcomes Richard Raizes, Partner at Plutus21 Capital. Plutus21 is a Dallas-based investment firm focused on alternative assets such as crypto, venture capital, and real estate.

Before early-stage investing, Richard received a finance degree from SMU in Dallas Tx. He then worked in both investment and corporate banking. Richard has worked in a variety of sectors, most recently, oil and gas and commodities. He has always looked at niche assets and alternative assets. Richard comes from a family background in technology, so with the experience of analyzing companies and underwriting different deals over a course of time.

Direct download: Richard_Raizes_of_Plutus21_Capital.mp3
Category: -- posted at: 1:50pm CDT

If they don’t define the exit, then you define the exit.

Today, we’ll talk about how to achieve an exit in a startup investment.

It’s easy to get into a startup investment, but difficult to get out- especially with a positive return.

Most startup exits come when they sell the business to another company or go public on the stock exchange.

It takes seven to ten years to achieve an exit in most cases.

Most investors let the startup define the exit.  If they do, that’s great.

If they don’t then you define an exit for your investment.  

I recommend using a convertible note that has a 3X in 3 year redemption right at investor sole discretion. This provides you the option of exiting at the 3 year mark or staying in for the long haul.

By year 3 it becomes clear where the startup is headed. They are either on the venture path to larger returns or they have left the venture path and moved into payroll mode.  

The problem with leaving the venture path is that most terms sheets give the investor an equity stake. If the company leaves the venture path and turns into a lifestyle business, then the equity is going to be worth at most a small return typically around the ten year mark. 

Define the exit you want and make an offer. Not all startups will take it, but many will.

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Espresso_--_how_to_achieve_an_exit.mp3
Category: -- posted at: 7:44pm CDT


In this episode, Hall welcomes Gerry Reihsen, Founder and CEO of Coasis Coalition. Coasis Coalition is an organization that builds community and offers a range of services to all participating or interested in participating in Opportunity Zones – investors, fund sponsors, real estate developers, startups and traditional businesses, state and city governments, and public institutions.By helping firms navigate the unique ecosystem of Opportunity Zones, they facilitate economic opportunity and development in disadvantaged geographic areas that brim with the potential of its people.

Gerry is a business building, deal-making and capital raising entrepreneur/consultant/attorney. Gerry is is deeply invested in the success of his clients, pouring his energy, experience and entrepreneurial spirit into every deal and transaction.

Direct download: Gerry_Reihsen_of_Coasis_Coalition.mp3
Category: -- posted at: 2:39pm CDT

In this episode, Hall welcomes Brett Lanuti, CEO and President of Nocimed. Nocimed centers on providing a better approach to low back pain diagnosis and related patient management. Brett has been in the medical device space for 25 years, focusing on providing better outcomes for patients. Brett provides advice to investors looking to break into the medical device and MRI/imaging space. He emphasizes the need to look broadly across the entire segment for investment opportunities. Brett also talks about how the space is evolving, and some of the challenges, particularly as it applies to MRI. Brett also discusses the unique perspective of a startup, SAS software company in the medical space, and the benefits it provides to practitioners.

Direct download: Brett_Lanuti_of_Nocimed.mp3
Category: -- posted at: 1:24pm CDT

Should You Invest in a Startup Fund

Choose broad or narrow investing to meet your goals

Today, we’ll talk about investing in a fund and choosing between a narrow or broad investment thesis.

When does a fund make more sense than direct investments?

A fund works best when you are not familiar with a sector or geography and don’t have the time to research and learn more about it.  

Also if access to the deals is time consuming or difficult, then the fund may be a better approach.

If the funding requirements are greater than your resources, then you may want to invest through a fund. For example, some sectors require several millions of dollars to participate in a deal so it’s a good strategy to pool your funds with others to participate.

Finally, funds provide diversification that can be more difficult to achieve with direct investments. 

Should you take a narrow investment thesis or a broad one?

Start with your investment goal and then ask if a narrow or broad thesis is the best way to accomplish it. In some cases, it makes more sense to become a specialist say in fin-tech payment or medical device companies.  

On the other hand, if you want to invest in startups in your local area to support the community then a broad investment thesis is better. 

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Espresso_-Should_you_invest_in_a_fund.mp3
Category: -- posted at: 9:25pm CDT

In this episode, Hall welcomes David Chaplin of Searchdex. SearchDex is a Dallas based SEO Service and Technology company with over 15 years in the eCommerce solutions space. They believe that every search should produce meaningful outcomes. No other company can identify and solve issues as SearchDex does. Today, businesses need a navigator to drive the best outcomes in this dynamic marketplace.

David has been CEO of SearchDex™, since December 2010. He led the efforts in pivoting SearchDex from a managed services company to a technology platform and solutions company.

Before SearchDex, David served as VP of Advanced SearchTechnologies. This position followed Kroll Ontrack’s acquisition of Engenium Corporation, which David founded in 1998. Dave was responsible for integrating Engenium’s advanced search products (AI based) throughout Kroll’s electronic discovery services business while growing outside sales of the Engenium product group. At Engenium, David grew the company from startup to recognized industry leader, earning multiple industry awards as one of the 100 most important companies in knowledge management and a leader in artificial intelligence solutions in the electronic discovery market.

Direct download: David_Chaplin_of_SearchDex.mp3
Category:general -- posted at: 11:41am CDT

Figure out what you want to invest in then look for resources to help

Today, we’ll talk about investing in startups

Should you invest in startups?

Startups are very risky and it’s a lot harder than it looks. 

If you have already invested in mutual funds, index funds, stocks, bonds, real estate etc. then you may want to consider investing in startups through either funds or directly in startups.  

How much should you invest in startups?

- Invest no more than 3% of your discretionary income. There are many good deals out there but for the most part the investment is illiquid for a long time. 

Where do you find deals?

- There are many sources including angel groups, networks, syndicates, and MicroVC funds that let you invest directly in the startup as well as the fund.

Should you invest alone or in a group?

- This depends on your investing style. A group can give you access to more deal-flow and due diligence support. On the other hand the group may pursue deals you are not interested in and vice versa.  

How to get started?

- Figure out what you want to invest in and then ask what resources you need to do so successfully. Do you need help with finding the deals, due diligence, or negotiating the terms. If so, then seek investors and groups that can help you achieve your goal. Don’t join groups because they appear to be fun and make investing look easy.

Investing in startups takes time but can be both challenging and rewarding.  

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!



Direct download: Startup_Espresso_--_Should_you_invest_in_startups.mp3
Category: -- posted at: 8:49pm CDT

In this episode, Hall welcomes Dr. Scott Augustine, CEO of Augustine Surgical. Augustine Surgical is dedicated to developing innovative products that target surgical safety to improve outcomes.

Dr. Scott Augustine is the inventor of the HotDog Patient Warming technology and is the world’s expert on patient temperature management, having also invented Bair Hugger forced-air warming over 30 years ago. The company is developing several innovative products that fit the focus on making surgery safer. The Augustine Surgical team has over 180 patents issued and many more pending.

Direct download: Scott_Augustine_of_Augustine_Surgical.mp3
Category: -- posted at: 12:56pm CDT

Use Metrics to show your progress

Today, we’ll talk about knowing your metrics

Investors look for the metrics in your business so it’s important to know them. There are three levels of metrics you can use:

Activity metrics show the basic activity of the business

Unit economic metrics show the unit economic model including cost of customer acquisition and revenue.

Growth metrics show the growth in the user base and usage of the product.

Activity metrics show number of users, downloads, registrations and the like. They fall short of business results such as closed sales. If nothing else focus on the customer engagement numbers you have.

If your company is pre-revenue you can show how the business model is “profitable” by using  unit economic numbers. At its core, you show the cost and process to generate leads, qualify, and close them for revenue.

In the early days of a business the revenue is small.  Most investors know that and don’t expect large revenue.  What they look for is repeatable and predictable revenue. Showing unit economics demonstrates you have a core business model that is working and with time and funding can improve.

Growth metrics show the number of users increasing and their usage of the product increasing. Daily active or monthly active users should be going up and to the right. If the business has seasons or cycles, then one can use a six month moving average to show your growth rate.

In summary, if you can only show activity metrics then do so.  If you can show unit economic metrics, that will help. The best metrics show  growing users and usage.

Whatever you do, don’t show up empty-handed.

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Espresso_--_Know_your_Metrics.mp3
Category: -- posted at: 7:34pm CDT

In this episode, Hall welcomes David Blankman of Title 3Funds provides investment opportunities in curated startups and growing businesses. They work with leading incubators to find the next big idea for their subscribed investors to hit home run after home run.

David is an experienced serial entrepreneur, bootstrapping five startups in diverse industries. He founded Blankman Asset Management a SEC Registered Investment Adviser managing client investment portfolios. As VP of an institutional client group, he raised over $300 million in funding for private placement securities issuers. He helped launch and co-manage a successful alternative investment mutual fund. David helped lead a successful Title III Equity Crowdfunding campaign in 2018. He refers to this important new capital formation as “Little Wall Street comes to Main Street”. Driven to guide startups and help them grow into thriving businesses. Working to help investors actively invest into online Equity Crowdfunding private placement securities.

Direct download:
Category: -- posted at: 2:28pm CDT

In this episode, Hall welcomes Dr. Suri Ganeriwala Founder and President of Spectra Quest Inc. Spectra Quest, Inc. is a leading developer and manufacturer of complete Turn-key Systems for training and diagnosis in Machine Vibration Analysis, Rotor Balancing, and Shaft/Coupling Alignment. The system includes Machinery Fault Simulators, Interactive Training Program, Data Acquisition Hardware/ Software, and Accessories. To accelerate the learning and design process SpectraQuest offers a series of interactive software CDs on Vibration Fundamentals and Calculations, Signal Processing, Alignment and Balancing.

Before founding Spectra Quest, Suri's background includes a bachelor's, master's and Ph.D. in mechanical engineering. He has over thirty years of industrial and academic experience in machinery fault diagnosis, signal processing, vibration analysis and control, and viscoelastic material characterization. Suri has worked for Philip Morris, Firestone, and Martin Marietta Aerospace. He has developed a unique method of instruction using the SpectraQuest machinery fault simulator (MFS), which is his creation from concept to completion.





Direct download: Suri_Ganeriwala_of_SpectraQuest.mp3
Category:general -- posted at: 11:28am CDT

Six months to build it and six months to sell it.

Today, we’ll talk about what to build first in your startup.

Some startups suffer from what I call the “Vision Problem”. They have a vision in their mind about what the product/service should look like AND they have to have it on the first day they launch their business.

Truly great visions take years to put in place.  

You’ll need to go to market with an initial product and then over time build on it. This first product will not be the full embodiment of your vision.

So what should you build first?

Start with the easy, not hard. Think about what Amazon started with. Their first service was  “We sell books online.“

Over the years they built an empire on top of those humble beginnings.

For software it should take 6 months to build and 6 months to sell. If you can't build it in 6 months you scoped it too large. If you can’t generate sales in 6 months then you built the wrong thing.

You need something that will generate revenue. A cash cow business will greatly help your business down the road. Most cash cows don’t look exciting or appear highly innovative but it can help fund the exciting innovations you have in mind.

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: 259_--_Startup_Espresso_--_What_to_build_first.mp3
Category: -- posted at: 8:27pm CDT

In this episode, Hall welcomes Henry Liu of Yeoman's Growth Capital. YGC is a venture studio focused on driving enterprise adoption of blockchain. They identify enterprise blockchain needs within Fortune 500 companies, then launch, fund, and staff new ventures to pursue those opportunities. 

Henry was the head of investments for an open-source technology focused family office. He is a sought-after keynote speaker and has been invited as a keynote / panel speaker @ SXSW, Italy, Dubai, Estonia, Lithuania, Seoul, Toronto, Brazil, and Ukraine.

Prior to joining the family office, Henry was a veteran member of the High-Growth team at Facebook managing venture-backed, growth stage companies in North America. He advised founders and CMOs on revenue and distribution channels, strategic positioning, and managed $150M+ in marketing spend and converted over $450M to product sales.


Direct download: Henry_Liu_of_YGC.mp3
Category: -- posted at: 2:17pm CDT

In this episode, Hall welcomes Robert Morris of TerrAvion. TerrAvion provides high revisit rate aerial imagery for agriculture. Since 2016 they have been the largest volume provider. Robert founded TerrAvion in 2013. His professional mission is to make robotics work for agriculture. Robert led the first drone platoon in Afghanistan, where he realized that drones are not a scalable, cost-effective solution. 


Direct download: Robert_Morris_of_TerrAvion.mp3
Category: -- posted at: 11:59am CDT

Show the system behind your goals

Today, we’ll talk about establishing a growth story for your startup

Investors fund deals based on the team, the market, or the technology.  While these are popular investment thesis, the investment decision often comes down to what I call “the Growth Story”.  

This is your operational revenue model showing how you acquire customers and how much they pay for your product/service.

If you have substantial revenue say a $1M then the investor assumes you have a growth story.  Growth stage investors will look at the model to see how much you can grow that business and what constraints you will face and when.

For pre-revenue or low revenue companies you can sho  in unit economic numbers the proven repeatable business model you have up and running. 

If you haven’t done so already then take $5K and prove out the unit economic model.

For example, let’s say

-You can generate leads for $1/lead from Facebook ads

-Through a followup email you  can convert 1 out of 50 leads into a paying customer

-Each paying customer buys on average $250 worth of product 

-You can take these numbers and render a basic economic unit model as follows:

CAC: $50

LTV: $250

CAC: LTV is 1:5

-You then add the time it takes for signup and fulfillment and you have a unit economic model. 

The fact you know your numbers will impress investors.  Investors look for the system behind the goals.  This is one way to demonstrate your growth story.

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: 258_--_Startup_Espresso_--_the_Growth_Story.mp3
Category: -- posted at: 5:12pm CDT

In this episode, Hall welcomes Jason Hull, Cofounder of Broadtree Partners. Broadtree Partners is a group of entrepreneurial investors focused on acquiring businesses where the owners are looking to transition from their current roles. They specialize in providing opportunities for owners to smoothly exit their companies and seamlessly change leadership, while preserving their legacy. As Jason puts it, they help owners who who want someone to help them "really realize the vision....or to allow them to get off the ride." Broadtree focuses on companies in the 1-5M EBITDA range, or what he calls "classically under-matched" companies.

Jason talks about the challenges and upsides, and what investors need to be prepared for should they choose to invest in this space. He also discusses his investment thesis, and explains some of the operational challenges in the acquiring companies that may be stagnant, but with potential.

Direct download: 01_Jason_Hull_of_Broadtree_Partne.mp3
Category: -- posted at: 5:24pm CDT

In this episode, Hall welcomes Ronald LeMay CEO of Main Street Data. Main Street Data was formed in 2017 to bring precise data to the agriculture world. While data has improved in many other industries, agriculture remains behind the curve and Main Street Data has set out to change that. Main Street Data enables ag-related organizations to dive deeper than ever before into the data and insights that drive better decisions. They also provide growers with an objective scorecard for farming practices, along with insights for where to invest for a better return.

Before joining Main Street Data, Ronald spent most of his career in communications. He worked with Southwestern Bell, AT&T and retired from Sprint in 2003 as president and COO. He decided to join Main Street Data because it's a portfolio company of OpenAir Equity Partners. Ronald and his son formed OpenAir Equity Partners in 1999 to keep him moving since according to Ronald he would never have the ability to or interest in retiring. So he invested in the predecessor to Main Street Data.

Direct download: Ronald_T_LeMay_of_Main_Street_Data.mp3
Category: -- posted at: 12:14pm CDT

Validation -- the Product Works and People will Pay for It

Today, we’ll talk about demonstrating product and market validation

In talking with startup investors the first two questions that come up are Product validation and Market Validation.

The product works and someone will buy it.

Investors look for evidence of this before moving into further diligence so it’s important to show this in your pitch.

Beta users are a great way to show the product works and customer interest.  In many cases, the product is a website providing some value in the form of data storage or analysis.

In today’s world, the chance that you will get the product up and running is fairly high but will someone use it and more importantly pay for it becomes the bigger question.

Customers who pre-pay for it check the market validation box. It demonstrates you are solving a real problem.

If you don’t have anyone paying for it, then you’ll need to resort to pipeline metrics showing the number of downloads, trials, and pilot programs.

While not the same as a paying customer it gives a leading indicator that the customer will most likely buy.

It’s helpful to show the funnel prospects go through in engaging your product.  This includes lead generation, qualification, closing, trials, pilot tests, and signed customers.

Investors look for a consistent signup percentage on the leads going through your program. 

While the absolute number of signups may not by high, the repeatability of your model can be compelling to the investor.

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.


Let’s go startup something today!

Direct download: Startup_Espresso_--_Product_and_Market_Validation.mp3
Category: -- posted at: 8:44pm CDT

 In this episode, Hall welcomes back Hélène Thibieroz, founder and senior managing partner of We Grow Green Tech. We Grow Green Tech focuses on accelerating growth for green technology innovation and impact by partnering with early to late-stage companies.

In a previous episode, Hélène talked about shifting her career three years ago to enter the green technology space, combining her passion for the environment and love of technology. She strongly believes technology can be successfully applied to create impactful, practical business solutions while making an impact on our future.

In this episode, Hall and Hélène follow up on their previous discussion about the state of green tech and discuss how We Grow Green Tech is currently progressing.

Direct download: Helene_Thibieroz_of_WeGrowGreentech-_Follow_up.mp3
Category: -- posted at: 3:22pm CDT

In this episode, Hall welcomes Christian Garces of Texas ColdWorks. Texas ColdWorks is the first state of the art public cold storage complex being developed in Austin, Texas. With over 280,000 SF, it will house food producers, co-packers, and logistic companies.


Before Texas ColdWorks, he was the founder and CEO of Tableaux. A manufacturer of architectural products, both for residential and commercial use. Christian holds a Bachelor of Arts from St. Edward’s University and a Masters of Business Administration from the University of Texas. He is an entrepreneur with experience investing and managing rental properties going back to the mid-1980s. He was the founder and president of Investors’ Street a securities day trading firm with offices in Austin, Dallas, and Miami. In the late 90s, he was Senior Business Analyst at The Capital Network (Credited with funding 100+ technology companies in central Texas) where he analyzed over 1,000 business ideas and coached hundreds of entrepreneurs and C-Level executives. Since then he has served as Advisor, Mentor & Judge for various organizations including the University of Texas Moot Corp, Texas Venture Labs, Texas Capital Network and Austin Economic Recycling Economic Development Program Reverse Pitch.

Direct download: Christian_Garces_of_Texas_Coldworks.mp3
Category: -- posted at: 10:50am CDT

For family and friends funding -- no one is getting paid back

Today, we’ll talk about raising funding from family and friends

Many startups launch their business with family and friends funding.

Some entrepreneurs are often reluctant to take money from their family because -- well Thanksgiving turkey tastes different if things don’t work out.

On the other hand, investors view funding from family and friends as an indicator of support.  After all, if your family and friends don’t believe in you why should they.

My recommendation is to go to family and friends and ask for no more than $5K per person and tell them it’s a donation.  No one is getting paid back.  

Most family and friends funding comes from those who want to support you and don’t look for a return. 

This also alleviates the challenge of valuing the business at such an early stage.

If the business does succeed you may want to give back by offering $5K for one of their projects. 

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Espresso_--_Raising_funds_from_family_and_friends.mp3
Category: -- posted at: 9:27pm CDT

In this episode, Hall welcomes back Will Szczerbiak of Greycroft Partners. Greycroft is a leading venture capital firm focused on investments in the Internet and mobile markets. Greycroft leverages an extensive network of media and technology industry connections to help entrepreneurs gain visibility, build strategic relationships, bring their products to market, and build successful businesses. Greycroft manages more than $1 billion and has made over 150 investments since inception.


In this episode, Hall and Will catch up from their previous interview and speak about the mobile-app space and where it is now heading. They also speak about what WIll has been up to since they last connected. His growth, new perspective, and lessons learned over the years.

Direct download: Will_Szczerbiak_of_Greycroft_followup_1.mp3
Category: -- posted at: 4:43pm CDT


In this episode, Hall welcomes Bruce Worrall CEO of IntellaSphere. IntellaSphere is the first Brand Affinity Marketing System. They help businesses/#SMBs market more effectively using a socially collaborative approach. Brand Affinity Marketing builds brand awareness and recognition with prospects and strengthens brand loyalty with customers. It's an all-in-one service that's simple, affordable and effective.


Before joining IntellaSphere, Bruce has a background in business development, product development and business operations for several companies. He has worked with Microsoft, Amazon, AT&T. He has also consulted to eBay, Microsoft,, Nuance Communications, and has been at approximately five startups at the VP or C-level, including a company called Fairmarket, which IPO'd. In his career, Bruce has gone full circuit from startup to IPO, to acquisitions.

Direct download: Bruce_Worrall_of_Intellasphere.mp3
Category: -- posted at: 10:02am CDT

Find customers to pay for the product before you build it

Today, we’ll talk about product development for startups.

In growing your business you must prioritize what products you develop. In developing a new product it’s helpful to ask ‘who is going to pay for it’ before you spend money on it.

The goal is to match the costs to sources. For existing product upgrades this could be current customers. They are ideal candidates for paying for the upgraded product. By surveying your current customers you’ll get a better idea of what they need.

In building new products you should consider finding anchor clients who will prepay part of the expense of the product development. If you can’t find anyone who will pay for it, then you may want to reconsider building the product.

Most startups avoid pre-selling a product because they think it will be too difficult. In reality it’s about the same amount of work.

There are benefits from working with customers in the product development phase.

You’ll learn the problem to be solved in a much deeper way. You’ll learn what customers will actually pay for and you’ll also gather competitive intelligence.

Matching product development with customer payments keeps you aligned with the market.

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Espresso_--_Know_who_is_going_to_pay.mp3
Category: -- posted at: 4:57pm CDT

In this episode, Hall welcomes Richard May of Invest in Texas Initiative. The Invest in Texas Initiative is a statewide non-profit industry trade association of economic development officials, attorneys, consultants, developers, business owners, and other related service providers. Their mission is to promote the Texas investment landscape internationally.

Before Invest in Texas Initiative Richard has a long past representing industries through trade associations. After representing public companies on Wall St and finding the space to be very conservative, Richard now enjoys working with VC’s and angels. He finds it is a much more dynamic and exciting area to work in.


Direct download: Richard_May_of_Invest_in_Texas.mp3
Category: -- posted at: 12:26pm CDT

Look for the right investor to lead your deal, not just the first investor

Today, we’ll talk about finding a lead investor for your deal.

I’m often approached by a startup who has several investors interested in their deal but no one wants to lead it.

This is not surprising given how much work goes into leading a deal which includes setting the valuation, selecting the key terms, and performing due diligence.

For those who don’t yet have a lead investor we start with a convertible note. A convertible note is a debt instrument that converts to equity later. This makes it easy for investors to join the deal without having a lead investor package it up for you.

At some point in the round an investor will express interest in investing but only for equity. If that investor will invest at least $100K then they are a lead investor candidate. You pursue that investor to lead your deal.

Those investing smaller amounts such as $25K will most likely not put sufficient time into negotiating the terms – especially the valuation so they are not good candidates to lead your deal.

You want to be in a position to take investments when they are offered. A convertible note works well for this purpose. Investors signed up for the convertible note demonstrate investor interest making your deal more attractive to the lead investor when they appear.

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Espresso_--_Finding_a_lead_investor.mp3
Category: -- posted at: 4:12pm CDT

In this episode, Hall welcomes Kirk Otis of Merger Partners. Hall and Eric talk about how companies can move their marketing function from a startup stage to a growth stage company. Merger Partners, a mid to lower market Investment bank, focuses on connecting entrepreneurs, business leaders, and management teams with the PE Capital market in order to fund acquisitions and growth initiatives. Kirk has a background in corporate finance at Fortune 100 firms, then 20 years in CorpDev. To date, Kirk has completed 52 transactions, totaling 13.5B, and has done transactions internationally in 10 countries. His deals fill product gaps, acquire customers, gain a position in entirely new markets and open up new market regions.

Direct download: Kirk_Otis_of_Exit_Partners_1.mp3
Category:general -- posted at: 2:49pm CDT

Today, we’ll talk about how to value your startup.

Since startups don’t have significant revenue then how do you value your startup when fundraising?

Traditional tools such as discounted cash flow, book value, and other standard accounting techniques don’t work for early stage companies.

For startup valuations we use the rule of 4.

For each value you have built into the business for revenue, team, product, and IP, give your startup $1M in valuation.

So for revenue, if you have 5 enterprise customers with contracts signed then give your startup $1M of valuation. If you have something less than that, then reduce the valuation. Say you have only 1 customer who is paying, then give your startup $200K in valuation. If you have no revenue, then give your startup $0 valuation.

If you have the team in place and working well, then give your startup $1M in valuation. If you only have two in place then give your startup $500K..

If you have the product up and running and ready to ship to the customer then give your startup $1M in valuation. If you have it in beta version then give your startup $400K..

If you have the patents filed and awarded then give your startup a $1M valuation. If instead you have a handful of provisional patents filed, then give your startup say $200K.

You then add up each of the 4 components and that gives you your startup valuation. In this example, the valuation would be $1.3M.

In the end, startup valuation is not a formula but rather a negotiation. No matter, what valuation you put forth, the investor will challenge it.

By using the rule of 4 you can articulate the values in your business which will be much more compelling then the usual response of “well I just think it’s worth that.”

Thank you for joining us for the Startup Espresso where we help startups and investors connect for funding.

Let’s go startup something today!

Direct download: Startup_Espresso_--_How_do_you_value_your_startup.mp3
Category: -- posted at: 7:05pm CDT

In this episode, Hall welcomes Gale Bowman of IrishAngels. IrishAngels was formed in 2012 as an angel investment network affiliated with the University of Notre Dame. Investors in the network all have ties to the university and they currently have over 230 investors in their active network. IrishAngels focuses on seed-stage investing. They look at companies that are raising rounds of $1 to $3 million. IrishAngels operates like a venture firm does, in terms of going out to find the deals. Their team screen the deals, do due diligence, and negotiate terms if needed. After the investment is closed, they work with the portfolio company's CEO on an ongoing basis to make sure that their organization is providing valuable help to that entrepreneur and the company, as they continue to grow.

Direct download: Gale_Bowman_of_Irish_Angels.mp3
Category: -- posted at: 1:34pm CDT

Today, we’ll talk about the documents you need for your fundraise.

The first document is the pitch deck.This is usually ten to fifteen slides introducing your deal to the prospective investor. It should cover the basics of the business including the problem you are solving, the solution and product you are offering, the competitive advantage, your business model, the team, financial projections, your fundraise amount, and the exit you envision.

You’ll also need a detailed 3 to 5 year financial projections often called the Pro Forma. This gives the investor an idea of what you will do the funds and how you envision the company growing.

In addition, you’ll need a data-room or what some call the due diligence box which contains key documents about your business. These documents include your entity filings, patent filings, articles of incorporation, income statement, balance sheet, and other documents detailing your business. Investors who want to make an investment will look for these documents so they can run their due diligence.

Finally, you’ll need a terms sheet which outlines the terms of the investment. Most investors will want this document as part of their diligence so they know exactly what they will be signing.

Thank you for joining us for the Startup Espresso.

Let’s go startup something today!

Direct download: Startup_Espresso_--_What_documents_do_you_need_for_your_fundraise.mp3
Category: -- posted at: 7:14pm CDT

In this episode, Hall welcomes Ed Pearce of Paragon Digital. Before investing in early-stage companies, Ed was an attorney for many years. He was general counsel of two publicly-traded companies. When both companies sold, he went to work for a venture capital firm in Dallas. Ed has a love for starting companies and coaching people through the process. He’s been with different companies that made deep use of venture capital, and then five years ago he bought Paragon Digital, to continue the process of investing and operating a technology-leveraged business.

Direct download: Ed_Pearce_of_Paragon_Legal.mp3
Category: -- posted at: 2:27pm CDT

Today, we’ll talk about the different type of investors you will find in the startup world.

There are four type of investors for your startup -- Venture Capital, Angel Investors, Family Offices and High Networth Individuals. There are lenders who provide debt financing but that’s a topic for another day.

Venture Capitalists are professionals with experience in the startup world coming from either the financial space or have run a startup in the past.
- They invest funds from limited partners such as family offices and pension funds.
- They invest for homeruns and seek a 10X return on every investment.
- They invest $150K to $500K on first rounds for seed and Series fundings and usually set aside funds for follow on rounds.

Angels are typically successful business people who invest their own money as a side project from their day job.
- They look for a 3 to 5 times return on their investment.
- Angels invest $50K to $100K on first rounds and sometimes set aside funds for follow on rounds.
- There’s a saying that angels want “to do a little good, have a little fun, and make a little money.”

Family offices are businesses set up to invest their own funds for a return and often have impact investing as part of their investment thesis.
- They invest $250K on first rounds and $500K or more on follow on rounds.
- They tend to be patient money.

High Networth Individuals (HNI) are similar to angels who operate at a higher level of funding writing checks of $100K to $250K for first rounds.

You can also raise money from family and friends, but I recommend raising small amounts below $10K each as Thanksgiving turkey tastes different if things don’t work out.

All of these investors meet the accredited investors criteria. Accredited investors are those the SEC deems high networth and can afford the risk that comes with early stage funding. You can learn more about the criteria to be an accredited investor by looking on the SEC website. In short, it’s anyone who has a networth of $1M or more not counting the house you live in.

Thank you for joining us for the Startup Espresso.

Let’s go startup something today!

Direct download: Startup_Espresso_--_What_type_of_investor.mp3
Category: -- posted at: 6:22pm CDT

In this episode, Hall is joined by Eric Bielke with GE Ventures. After working with one of the early firms in Data Science, and a foray as an entrepreneur in the solar energy space, Eric joined the VC space focusing initially on energy investments.


More recently, Eric has been focusing on aerospace and space tech. He talks about some of the latest developments in aerospace, as well as provides advice for investors looking to get into that sector. In addition, Eric provides some advice for aerospace startups, talks about a few that he's worked with, and highlights some of the subsectors he finds particularly promising.

Direct download: Eric_Bielke_of_GE_Ventures.mp3
Category: -- posted at: 3:28pm CDT

Today, we’ll talk about the deal structure you should use for your fundraise.

There’s equity, and then there are convertible notes and SAFE notes. If you want a straight loan, then you should use a promissory note.

Equity agreements set the valuation for the company and various terms of governance, preferences, voting rights and more.

A convertible note is debt that is intended to convert to equity. A convertible note has three terms: the interest rate, discount rate, and cap rate. The interest rate is how much interest is earned while the investment is in the note form. The interest is not paid out but rather accumulated and converted to equity later. The discount rate is how many additional shares the holder will receive when it converts to equity. The convertible note holder came in early to the deal and should receive more than those who come later. Finally, there’s the cap rate which determines how the note converts to equity. The conversion will depend on the valuation set in the next round.

SAFE notes are similar to convertible notes, but often leave out one or more of the key terms. Convertible notes typically convert on a timeframe such as 3 to 5 years or on an event such as a major equity funding.

Thank you for joining us for the Startup Espresso.

Let’s go startup something today!

Direct download: Startup_Espresso_--_Deal_Structures.mp3
Category: -- posted at: 5:18pm CDT