Investor Connect Podcast

MVP Mistakes

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In developing a minimal viable product avoid these mistakes:

Trying to create your vision fully in the MVP.

The MVP will be a greatly reduced version of the envisioned product.

Taking customer feedback literally.

Customers will provide feedback and ask for specific features.  

In building a product you must look at the bigger picture to see what problems you solve and what problems you don’t solve.

Overbuilding the MVP.

The MVP should be simple to install and use and should not require extensive support to engage users.

Using the MVP as the basis for the final product.

The MVP provides feedback from which you rethink the entire product including the form factor, features, and even what problem you solve.

Building just one MVP.

The more MVPs you can build and test the more you will find the right mix of features, pricing, and form factor.

Avoid these mistakes in building your minimum viable product.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: MVP_mistakes.mp3
Category:general -- posted at: 5:00am CST

Product Features

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

The features of your product will determine your competitive position in the market. 

For any market, there is a baseline set of features that customers will expect.

To enter the market your product must provide these basic services.

To beat the competition your product must have differentiation features.

Differentiation features distinguish your product from the competition.

This gives the customer a reason to choose your product over competitors.

Customers will demand the basic features and their performance.

It is up to the founder to drive the development of the differentiation features.

Your sales team will push for basic features and their performance to close current customers.

Your current customer will drive the basic feature set for their own needs.

You must drive the differentiation feature set for new markets.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
For Startups check out: https://tencapital.group/company-landing/ 
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Direct download: Product_features.mp3
Category:general -- posted at: 5:00am CST

Product Adoption

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Product adoption raises awareness about the product and drives users to sign up for it.

A strong product adoption process generates more customers, reduces churn, and increases customer loyalty.

Product adoption comes in stages as follows:

Awareness -- first make your customer aware of your product.

It is important to educate the customer about your product and the need it solves.

Interest -- you must build customer interest in your product.

Content marketing, events, and webinars can be useful tools for providing more information.

Consideration -- you must differentiate your product from the competition.

You want the customer to consider your product in an evaluation alongside the competition.

Testing -- you must engage the customer in a pilot test.

These could be free or reduced-cost trials.

Lock-in -- you want to set up your product so that it becomes a must-have for the customer.

Designing sticky features will help lock in your solution.

Consider these stages in driving product adoption.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Product_adoption.mp3
Category:general -- posted at: 5:00am CST

Product Experience

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Product experience is the customer's engagement with the product.

Consider these customer touch points in developing the product experience:

Sign up -- this is the stage customers commit to the product and join.

Make sure you have an easy signup process that states clearly what the customer will receive.

Onboarding -- this is the stage customers set up the product for their own use.

Again, make it simple for customers to use the product.  

Design it such that the user gains a benefit from it quickly. 

Support -- provide multiple channels of support.

Provide online and on-the-phone support for the customer to get answers to their questions.

Renewals -- build automatic renewals into the product.

Remind the customer that the renewal is coming up and check for any concerns.

Upgrades -- provide updates to the product with new features.

Notify the customer of upgrades and how they will impact their use of the product.

Sharing -- give the user the ability to share their experience with the product both good and bad.

Provide a community access channel that gives the customer a chance to find additional information about the product and also share success stories.

Design the product experience up front so it’s part of the product itself.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Product_experience.mp3
Category:general -- posted at: 5:00am CST

Product Research

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Before building your minimum viable product, you’ll need to research the space.

Here are some key points to consider:

Know your customer and their problem very well.

Many founders start building a solution to a problem that they only know superficially.

Talk to at least fifty prospective customers about the problem to understand it.

For the next fifty prospective customers propose a solution and capture the feedback.

Once you have a product you must continue the research to refine the product features, positioning, and selling points.

For researching the next version of the product here are key questions to ask:

How did you find the product?

Why did you choose the product?

Who in your organization uses the product?

What do you like most about the product?

What do you like the least about the product?

Would you recommend this product to someone else?

Look carefully at what the customer does with the product in addition to what they say about it.

Many customers will complain about a product but they continue to use it extensively.

Look at the characteristics of those who are successful with the product and those who are not as it helps build an ideal customer profile. 

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Product_research.mp3
Category:general -- posted at: 5:00am CST

Thank you for joining us today for our TEN Capital Fundraise Launch Program.

In this program, we help startups prepare for a fundraise. 

We provide templates, tools, eGuides, and advice to founders who are working towards raising funding.

We’ll kick off the session with a short overview on a fundraising topic, then we’ll answer questions from the founders.

I hope you enjoy this episode.

___________________________________

Thank you for joining us for the TEN Capital Fundraise Launch Program where we help startups prepare for a fundraise. 

For more episodes, please visit the site at: http://investorconnect.org  

Check out our other podcasts here: https://investorconnect.org/  

For Investors check out: https://tencapital.group/investor-landing/ 

For Startups check out: https://tencapital.group/company-landing/  

For eGuides check out: https://tencapital.group/education/  

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Direct download: 2022-05-10_TENFL_Friends_and_Family_Funding_Q_A.mp3
Category:general -- posted at: 5:00am CST

Product Research Best Practices

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In researching your product include these best practices:

Always be researching when talking with prospects and customers.

Focus on the audience and their needs and not the product and its features.

Identify the customer journey and how your product fits into it.

Track the user's thought process in engaging your product to see where there’s alignment and misalignment.

Focus on what the user actually does with the product rather than only what they say about it. 

Engage the entire team on research by arming them with questions to ask and capturing any feedback they receive.

Create a central repository for customer feedback so it’s easy to access.

Summarize the research with proposals and recommendations to share with the entire team.

Segment the research into logical groupings so it’s easier to understand the data points collected.

Measure the contribution each team member makes by reviewing the centralized repository.

Product research is a continual process. 

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
For Startups check out: https://tencapital.group/company-landing/ 
For eGuides check out: https://tencapital.group/education/ 
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Direct download: Product_research_best_practices.mp3
Category:general -- posted at: 5:00am CST

Product Innovation

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Innovation is a part of product research and development.

Product innovation provides a competitive advantage, opens new markets, and increases sales to existing customers.

Determine how much you will spend on product innovation.

Set a budget for people and time to work on those innovations.

Base this budget on demands from customers as well as pressure from the competition.

Segment your customer base and perform market research.

Brainstorm various innovations and test with customers to determine the potential increase in sales from each innovation.

Compare the cost of innovation with the potential sales increase.

Consider pursuing innovations that can pay back more than the basic development cost.  

Repeat this process with each segment of the customer base and with various solutions.

Prioritize the approved innovations across the various customer segments to work on the highest return projects first.

Innovation is a key aspect of product development but it must be managed within the constraints of the company’s budget and the ability to monetize the innovation.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Product_innovation.mp3
Category:general -- posted at: 5:00am CST

Product Development Challenges

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Product development in a startup brings several challenges.

Here’s a list of key challenges to overcome:

Picking the right problem to solve.

There are many problems to solve so it’s important to select the right problem up front.  

You’ll need a compelling solution and a means to monetize it.

Building the first product.

Many founders focus on their ultimate vision but the first product will be a greatly reduced version of it.

Look for an entry point that you can build in a short amount of time and can monetize equally fast.

Knowing your ideal customer.

It’s important to know who will buy your product and why as well as how much they have to spend for it.

Validate your idea.

Once you have a proposed product, you’ll need to test it out on prospective customers to see if they will pay for it.

Scoping the first version of the product.

The initial product should solve an important part of the problem rather than the entire problem.

It should work well for the customer.

Scope in on your product and tighten your ideal customer profile to build your first product.

With a product available to sell you can grow revenue, feedback, and a customer base that you can use to raise funding.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Product_development_challenges.mp3
Category:general -- posted at: 5:00am CST

Minimum Viable Product

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Product development begins with a minimum viable product.

In building your MVP, set constraints with respect to development time and selling time. 

In software development, it takes six months to build the product and six months to sell it. 

If you can’t build it in six months you scoped the product too large. 

If you can’t sell it in six months then you built the wrong product.

By putting constraints on your MVP up front you can eliminate many paths letting you focus on the few that are viable.

The purpose of the MVP is to test the market, close initial customers, and raise funding. 

The customer feedback from it will drive the specification for the first product. 

The first full version of the product is rarely an incremental revision of the MVP.

It’s most often completely different in features, packaging, and pricing. 

It’s not important to get the MVP exactly right as it’s for initial testing. 

It’s far better to go out to the market quickly and gain feedback.

Save the deep dive development for your first full product. 

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Minimum_viable_product.mp3
Category:general -- posted at: 5:00am CST

Source of Failures in Product Development

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

There are many challenges in product development.

Here’s a list of failures points to watch out for:

Inexperienced developers who mean well and work hard but lack the experience.

Hire for the skills you need rather than try and build the skills on the go.

Growing a product from a custom solution into a general solution can be difficult.  

Setup a separate development plan to turn the custom solution into a general one.

Lack of ownership.

Make sure there’s a team lead who owns the outcome.

There’s no overarching vision of what the product will become.

Set up a strategic plan for the product with a five-year window.

The team continues to fall down due to defections and a lack of interest.

Build in strong leadership who can hold a group together.

There are too many features and requests.

Install a process for prioritizing development on new features.

Feature creep pushes out the delivery date.

Set target dates for upgrades and ship on those dates moving the undone features to the next release.

There’s no product launch to the market.

Budget for marketing to bring the product to the market.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Source_of_failures_in_product_development.mp3
Category:general -- posted at: 5:00am CST

On this episode of Investor Connect, Hall welcomes Martin Tobias, Managing Partner at Incisive Ventures.

Located in Seattle, Washington, Incisive Ventures is a $10M pre-seed fund currently seeking limited liability partners. They focus on technology companies that reduce friction at scale, targeting high-friction industries like Fintech, supply chain, vertical SaaS, and health and fitness.  

Martin is also an ex-Accenture, Microsoft, and a former venture partner at Ignition Partners. He is a 3X venture-funded CEO raising over $500M with two IPOs and has also invested in over 200 companies as an angel, 50 through Incisive Ventures, and he is also a limited partner in over a dozen VC funds. He was an early investor in Google, DocuSign, OpenSea, and over a dozen unicorns.

Martin is the father of 3 daughters, a cyclist, surfer, poker player, and life hacker. He writes about venture capital on [Incisive Ventures](https://incisive.vc/insight/) and notes to himself on how to live the good life on his [personal blog](https://deepgreencrystals.com/).

Martin shares some of the challenges startups face, his criteria for making an investment, and how he sees the startup industry evolving in the near future. 

Visit Incisive Ventures at https://incisive.vc/, and on LinkedIn at www.linkedin.com/company/incisive-ventures/. 

Reach out to Martin at: www.linkedin.com/in/martintobias/; twitter.com/martingtobias; martin@incisive.vc; martin@slashr.com.  

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org  

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Martin_Tobias_of_Incisive_Ventures.mp3
Category:general -- posted at: 5:00am CST

Challenges in Product Development

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Product development brings many challenges to the startup.

Here are some key points to watch out for:

Funding takes time to raise so focus your product development on MVPs and draw as many lessons to be learned as you can from each one.

Building a product that actually solves the customer’s problem is a key challenge.  Keep the big picture in mind and continue to use customer feedback to guide development.

Hiring people takes time so make sure your recruiting keeps up with your development plans which often require new hires.

When things don’t go as planned make sure you have thought about alternative paths. 

What if sales aren’t what was forecasted?  What if the customer doesn’t adopt the product as expected?  

Have a plan for each situation. 

Competition can change your company’s position with the customer.  

Research your competition and keep up with their progress.

Planning ahead will help you overcome these challenges when they arise.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
For Startups check out: https://tencapital.group/company-landing/ 
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Direct download: Challenges_in_product_development.mp3
Category:general -- posted at: 5:00am CST

Outsourcing Product Development

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Many startups outsource their product development.

Here are some key points to consider before outsourcing:

Outsourcing gives you access to additional skills and resources you may not be able to hire yourself.

It can also lower your costs as you pay for the work to be done through contracts rather than salaries.

The key is to have someone on your team manage the outsourced product development.

Their job is to specify the work to be done including designing architectures, coding to standards, and documenting the code. 

The team building the product needs to have a project manager that can set priorities, drive to meet deadlines, and communicate with the startup hiring them.

Startups must have a very well-defined specification that includes wireframes, screenshots, and clear descriptions of each function.

There must be daily email communications for posing and answering questions as well as weekly status updates on what is accomplished.

Collaboration tools for tracking the project status and communications between the developers and the team are a must.

The startup must be able to test the software on a regular basis and provide feedback.

You must install solid specifications, project management, and communication processes to gain the benefits of outsourcing product development.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Outsourcing_product_development.mp3
Category:general -- posted at: 5:00am CST

How to Reduce Costs in Product Development

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Product development often runs over budget.

Here are some steps to reduce costs:

Start with good planning and define the goals clearly.

Many projects launch with unreasonable expectations.

Track the progress using metrics to know how you are doing. 

Make sure the team is up to the tasks at hand.

Identify the skills needed for the project and match them to the team you are proposing to hire.

Build communication into the process using collaboration tools.

Setup communication channels including regular status reports, code reviews, and documentation deadlines.

Define communication as a part of everyone’s job.

Test the software as you develop it.

Some groups run daily builds from the get-go.

Start with the core features and work out from there to the ancillary ones.

Focus on the minimum viable product for the first version.

Simple processes can help you bring your product to market on time and under budget.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: How_to_reduce_costs_in_product_development.mp3
Category:general -- posted at: 5:00am CST

Tips for Success in Product Development

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

It takes a plan and persistence to bring a product to market. 

Here are some tips to make your product development successful.

You’ll need to bring passion to the project to see it all the way through.

Use Minimum Viable Products to test out the idea and gather feedback. 

Success with an MVP will energize the team to move forward.

Don’t try and do it all yourself.  Setup processes and delegate.

Hire the right people with the skills necessary to take it through to the market.

Foster a culture of innovation and curiosity.

Prepare the team to pivot the product, the price, or the positioning, and don’t marry yourself to one concept as it will most likely change.

Funding the new product will take some time as fundraising is a process.

Use mistakes as a learning opportunity.

Enjoy the process of innovation and discovery.

Show the team how thankful you are for their contribution.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Tips_for_success_in_product_development.mp3
Category:general -- posted at: 5:00am CST

Product Development Using IDEO

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Startups can use the IDEO  method to build out their product development process.

Here are the steps:

Observation -- observe the user and their pain points.

Ideation/brainstorming -- turn the observations into product ideas and use brainstorming to generate multiple variations.

Prototyping -- mock up an example of the proposed product using simplistic approaches such as made-up datasheets, screen interfaces, and cardboard prototypes.

User feedback -- gather user feedback using the prototypes.

Iteration -- use the feedback to iterate on the product and generate more feedback.

Implementation -- take the feedback and develop the first version of the product.

Make sure you capture the feedback in written form for review later.

Continually validate the product with new users.

Launch the product into the market for even more feedback.

The IDEO process works well for products developed around the user.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Category:general -- posted at: 5:00am CST

On this episode of Investor Connect, Hall welcomes Michelle Seiler Tucker, Founder, and CEO of Seiler Tucker, Inc. and EXIT RICH Podcast. 

Located in New Orleans, Louisiana, Seiler Tucker, Inc buys and sells businesses. They help business owners with the valuations of their businesses so they can sell for the most profit and find the right buyers for their businesses.

Michelle holds the M&AMI (Mergers & Acquisitions Master Intermediary) title, as well as the Certified Mergers and Acquisitions Professional (CM&AP) and Certified Senior Business Analyst (CSBA). 

She also owns many other businesses in several different industries. She and her firm have sold businesses in almost every vertical and have a remarkable track record of success.

Michelle discusses helping business owners find the right value for their businesses, finding the perfect buyer, and much more. 

Visit Seiler Tucker, Inc. at: https://seilertucker.com/;http://www.linkedin.com/company/seiler-tucker/ 

Reach out to Michelle at: http://www.linkedin.com/in/michelleseiler/; https://twitter.com/MSeilerTucker; podcasts@seilertucker.com; marketing@seilertucker.com

_______________________________________________________

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Category:general -- posted at: 5:00am CST

Product Development Team Dynamics

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Product development requires a team approach.

Here’s a list of key points to consider:

Assess the skills of each team member to understand the group’s capabilities.

Set goals for the team before the project sprint begins.

Lack of clarity causes confusion among the team members.

Check the feasibility of the project sprint before launching it to make sure the team is on board. 

Break down big projects into a series of smaller ones that you can execute on.

Use a kanban or card-based tool to track the projects. 

It will highlight where there are too many bottlenecks.

Use scrum as a framework to manage the meetings, the tools, and the roles for the team members.

The project manager needs to exercise leadership in resolving conflicts among the team and setting priorities for projects.

There’s a tradeoff between quality, speed, and cost of which you get two.

It’s important the team buys into the tradeoffs made along the way.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Product_development_team_dynamics.mp3
Category:general -- posted at: 5:00am CST

Product Development Best Practices

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Product development is an important function in a startup.

Here are some best practices to consider:

Maintain focus on the user.

Involve other stakeholders in the process such as sales and marketing.

Metric your product development process to know how you are doing.

Focus on those areas with a strong return on investment.

Prioritize the strategic objective of your product development such as lowering product cost, improving time to market, or increasing product quality.

Practice design reuse to lower the cost.

Involve suppliers and partners in the planning phase.

Obtain commitment for the plan from all stakeholders.

Use rapid prototyping tools and techniques.

Use collaboration tools to keep everyone informed of the progress and issues.

Run a gap analysis to identify areas for improvement.

 

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.

_______________________________________________________

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Direct download: Product_development_best_practices.mp3
Category:general -- posted at: 5:00am CST

Lean Startup Approach to Product Development

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

The lean startup approach seeks to discover a product and business model that works.

Unlike big companies which have a large staff to maintain an existing product line, the startup has little to no staff and works on finding new business opportunities.

Startups use the lean startup approach in product development.

They look for product market fit by focusing on the product and the customer rather than the larger market or internal processes.

The startup finds itself working with emerging technologies in newly defined fields.

The purpose is to create a minimum viable product and test it with the market.

The startup uses A/B testing to try out variations of the product.

The startup team focuses on interviewing customers, identifying needs, and proposing feature sets.

The product development process runs on a limited budget and a short timeline.

The lean startup process consists of building several MVPs and testing them out until product market fit is identified.

Quite often, the technical development team is outsourced to another company.

 

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.

_______________________________________________________

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Category:general -- posted at: 5:00am CST

Product Development Plan

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Here’s a checklist for launching product development for your startup:

Research the industry for trends and competitors in the space.

Talk with prospective customers about their pain points.

Consider not only the product to be built but the revenue to be generated.

Build out several Minimum Viable Products or MVPs.

Plan out a product roadmap from beta, to versions 1, 2, then 3.

Consider your intellectual property strategy.

Consider the platforms and coding language you will use.

Think through the product architecture so you can grow it later.

Make the development in-house or out-of-house decision.

Figure out the costs to develop and the funding needed.

Setup your development process to code the solution.

Test out the interfaces with users.

Track the metrics of your development process.

Launch your first version of the product.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Category:general -- posted at: 5:00am CST

Creativity Is a Process

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Ideation requires creativity. 

Creativity is a process no different than any other activity.

Here are some steps to follow in generating creativity in your ideation program:

Start with preparation.

Capture your ideas into a list for evaluation.

Incubate the ideas.

Spend time exploring the ideas listed.

Identify the insight.

The idea crystallizes into a potential solution after a period of reflection.

Verify the idea.

Test the idea against your criteria for a solution.

Finding ideas comes from observation in which one notices interesting facts.

Trying to formulate ideas without any exposure to the situation is very difficult.

Most good ideas have an element of effective surprise which is a quality of obviousness producing a shock of recognition after which there is no longer astonishment.

Consider the role of creativity in your ideation program.

 

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.

_______________________________________________________

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Category:general -- posted at: 5:00am CST

On this episode of Investor Connect, Hall welcomes Mike Millard, Operating Partner at Ecliptic Capital.

Located in Austin, Texas, Ecliptic Capital is an emergent, early-stage innovation fund focused on pre-seed, seed, and Series A investments. Ecliptic Capital invests in companies that use science and technology as a lever to disrupt lagging industries and cultivate multiple market adjacencies. Their approach is industry agnostic and aims to invest in accelerating technologies that solve big problems and make a global impact in sectors such as energy, climate change, human welfare, and social change.

Ecliptic Capital invests in broadly disruptive technologies that can be applied to multiple market adjacencies improving returns and reducing risk. Their unique structure allows them to maximize these world-changing opportunities, each to their fullest extent, by not forcing exits too early or abandoning them at the first sign of distress.

Mike spent over 20 years of his career in newly formed Fortune 500 divisions and venture capital, creating value at scale with engagements at Dell, HP, AT&T Knowledge Ventures, Ascension, and Austin Ventures. His years in the corporate arena culminated in becoming a Texas innovation ecosystem builder.

Mike is also the Co-Founder of Pitch-a-Kid - where real entrepreneurs pitch their company ideas to kids. It helps kids learn about entrepreneurship while pushing entrepreneurs to communicate better using straightforward language. 

Mike discusses strategies for investments, how to bring value to a startup,  how to reduce risks when investing, and more.

Visit Ecliptic Capital at: www.eclipticcapital.com, www.linkedin.com/company/eclipticcapital/, and Twitter @EclipticCapital.

Reach out to Mike at: www.linkedin.com/in/mikemillard/L, millard@eclipticcapital.com, and Twitter @millardtx.

_______________________________________________________

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Category:general -- posted at: 5:00am CST

Testing Your Ideas

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

After generating ideas for your startup, you’ll need to test those ideas.

Consider these points in your evaluation:

Research the market on the product you intend to build and sell.

Is it big enough and growing fast enough for a venture deal?

Who is the competition and how are they positioned in the market?

How saturated is the market and where are the open spaces?

How differentiated will your product be and will that be enough to win customers?

What do the comments on social media platforms indicate about the market’s view of current products?

How scalable is the proposed product?

Will the product and its business model generate high growth?

What is the break-even point for the proposed product?

How much funding will need to be raised to achieve the product launch?

Finally, what is the channel to the market?

Test your startup ideas with these questions before committing to 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.

_______________________________________________________

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Category:general -- posted at: 5:00am CST

Basics of Product Development

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Product development should follow a standard process.

It starts with a strategy.

That strategy should align with the goals of the company and mesh with its current product roadmap. 

The specific product should further the company’s business objectives such as increasing revenue, reducing costs, or holding off a competitor.

The product development process should take into account the financial objectives such as meeting a quota line or increasing margins.

There should be a scope that defines where innovation should occur and where it should not.

Product development should have established processes for developing new products as well as upgrading existing ones.

It should draw from research both within the company and from sources outside the company.

Product development should maintain a view of the company’s portfolio and how new products will fit in.

There needs to be a process to tradeoff between risk and reward on new products.

Finally, the company needs capabilities to deliver on product development including leadership such as project management and technical skills for product development.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Startup_Funding_Espresso_--_Basics_of_Product_Development.mp3
Category:general -- posted at: 5:00am CST

Where to Start Your Product Development

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

It’s important to have a product development process for your startup.

Here’s a list of what startups should do to get started:

Focus on the customer's pain.  Find that which is critically important and not just nice to have. 

Do it better than the competition.  Don’t be just slightly better, be way better.

Use the SCAMPER model to ideate new product concepts as follows:

Substitution -- use a different material, ingredient, or interface.

Combine -- put multiple components together.

Adapt -- make it easier for the user.

Modify -- add one new feature to an existing product.

Put to another use -- take an existing solution and apply to a new application.

Eliminate -- remove unnecessary features or intermediaries.

Reverse -- approach the problem from the other direction.

It’s important to know your customers and then spend time with them to validate the proposed solution.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Startup_Funding_Espresso_--_Where_to_start_your_product_development.mp3
Category:general -- posted at: 5:00am CST

Product Development Using Stage-Gate

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Startups can use the Stage-Gate method to build out their product development process.

Here are the steps:

Idea generation -- use brainstorming, market research, and other tools to come up with ideas.

Idea screening -- create a set of criteria to judge the ideas and determine what to pursue.

Development and testing -- flesh out the concept for an idea and test the market with it.

Business analytics -- this step determines the business model, competition, costs to build and deploy, pricing, and other aspects of the product.

Marketability tests -- test the product in small groups for feedback and use for further development.

Product development -- build the product including the promotion and fulfillment.

Commercialization -- sell the product with support, logistics, marketing, and more.

Perfect the product and pricing -- adjust the price for the market and costs to build and deliver.

The Stage-Gate process works well for products that follow a linear development path.

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Startup_Funding_Espresso_--_Product_development_using_stage_gate.mp3
Category:general -- posted at: 5:00am CST

Finding Your Value Proposition

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In ideating for a startup you must first start with a customer problem. 

Once you find a solution for that problem, you then identify your value proposition.

A value proposition is how you solve a problem and the benefit it brings to your customer.

Here are the steps to find your value proposition:

Start with a customer problem. 

Articulate the benefits of your proposed solution.

Choose a specific problem case.

Show how your solution solves that problem.

Show what the customer should expect from your company.

This makes your solution relevant to the customer's problem.

Quantify if possible how your solution provides value to the customer.

This could be a calculated ROI such as your product reduces your cost by 2x.

Show how your business is uniquely positioned to solve the problem.

Phrase your value proposition in five words or less.

It should show how your customer benefits from your product or service.

Great ideas for a startup generate strong value propositions to the customer. 

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Category:general -- posted at: 5:00am CST

Thank you for joining us today for our TEN Capital Fundraise Launch Program.

In this program, we help startups prepare for a fundraise. 

We provide templates, tools, eGuides, and advice to founders who are working towards raising funding.

We’ll kick off the session with a short overview on a fundraising topic, then we’ll answer questions from the founders.

I hope you enjoy this episode.

_______________________________________________________

Thank you for joining us for the TEN Capital Fundraise Launch Program where we help startups prepare for a fundraise. 

For more episodes, please visit the site at: http://investorconnect.org  

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Category:general -- posted at: 5:00am CST

The Vision Problem

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In turning your startup idea into a product you’ll need to avoid the vision problem.

The vision problem is having a product or service in mind and then trying to build and launch it as your initial product.

Big vision products take years to develop in most cases.

It’s not practical to build your fully envisioned product in one go.

You’ll need to break it down into steps and stages.

The first product you build to enter the market will be a greatly reduced version of your vision.

This can be hard for some founders because they want the envisioned product now.

This often leads to founders trying to raise outsized amounts of funding.

In essence, they want to pole vault over years of development by raising capital.

Even if they could raise that funding, it’s most likely that they will end up building the wrong thing.

Take the envisioned product and break it down into smaller steps.

Make your first product small and simple so you can enter the market.

Then grow the product from there to the full vision.

Create a roadmap of products showing how you grow from one product to the next in a logical fashion.

Avoid the vision problem and work on a product development path that uses customer revenue to help achieve the vision.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: The_vision_problem.mp3
Category:general -- posted at: 5:00am CST

Legal Aspects of Ideation

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

There are financial and legal aspects to startup ideation.

Here are some key points to consider:

Test your idea with a minimum viable product before investing substantial resources.

All ideas look good until you have to actually build and sell it.

As always there should be more than one MVP on ideas that pass muster.

Check the numbers.

Do a basic financial analysis to see if the numbers make sense.

Model out the cost to build and sell the product.

Make sure all contributors to the ideation process have signed intellectual property rights over to the company.

This is often part of the employment agreement but should also be applied to contractors and other contributors.

Skip the non-disclosure agreements also called NDAs.

You want to generate more exposure to customers. 

A few precautions at this stage can save a tremendous amount of time and energy later.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Startup_Funding_Espresso_--_Legal_aspects_of_ideation.mp3
Category:general -- posted at: 5:00am CST

Use Design Process for Ideation

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In ideation for a startup, it’s important to follow a process.

Consider these process steps for your ideation program:

Empathize -- understand your customers' problems very well including what works for them and what does not.  

This takes the research to a deeper level and includes the wishes and fears that customers have.

Define -- analyze the problems and categorize them into meaningful structures.

Consider the user’s journey and capture what the customer must do to accomplish their task.

Ideate -- generate potential solutions for the customer’s problems.

Capture all ideas in writing to share with the team.

Prototype -- develop a prototype for each viable solution.

It’s important to build something that potential users can engage with.

Test -- test the prototype on customers.

Engage customers to check their feedback on the prototype.

The process is iterative as the feedback from the customer will refine the definition of the problem which will require more ideation, prototypes, and testing.

Ideation builds on previous prototypes carrying the lessons learned to subsequent versions.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Use_design_process_for_ideation.mp3
Category:general -- posted at: 5:00am CST

More Mental Models for Ideation

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

There are several more approaches to ideation for a startup.

Consider these mental models for your ideation process:

Move online -- take offline interactions and move on to the web.

Roll-ups -- acquire other companies into your company or into a new one.

Provide enabling technology -- provide technology to an industry segment to reduce cost or increase productivity.

Commercialize patents -- take technology sitting on the shelf such as at a university and commercialize it.

Spin off technology -- take a successful internal technology and set it up as a stand-alone company.

Extend technology in the market -- apply high-end technology to low-end applications to reach more users.

Picks, shovels, and Levis -- provide the tools to other companies serving a customer.

Monetizing a network -- build a business that takes advantage of channel access.

Consider these additional mental models for ideation in 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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Category:general -- posted at: 5:00am CST

Ideation Steps

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Ideation requires a process.

There are specific steps required to reach a successful outcome.

Here are the steps to follow for your ideation program:

Define the problem.

Write out a problem statement to define clearly the problem to be solved.

Set the criteria.

This defines what criteria the idea must meet to be considered.

Generate ideas.

There are several methods to generate ideas including mind mapping and inversion.

Mind mapping starts with a core focus and then draws out related concepts.

Inversion is the process of reversing the problem and creating a list of ideas to solve it.

Idea selection.

Apply your criteria to the generated ideas and eliminate those that don’t fit.

Test the ideas.

Take the ideas that meet the criteria and test them out.

Ideation is a process just like every other business function.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Thank you for joining us today for our TEN Capital Fundraise Launch Program.

In this program, we help startups prepare for a fundraise. 

We provide templates, tools, eGuides, and advice to founders who are working towards raising funding.

We’ll kick off the session with a short overview on a fundraising topic, then we’ll answer questions from the founders.

I hope you enjoy this episode.

_________________________________________________

Thank you for joining us for the TEN Capital Fundraise Launch Program where we help startups prepare for a fundraise. 

For more episodes, please visit the site at: http://investorconnect.org  

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Direct download: 2022-03-08_TENFL__The_Art_of_Pitching_QA.mp3
Category:general -- posted at: 5:00am CST

Lateral Thinking

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Lateral thinking is solving problems using an indirect and creative approach via reasoning that is not immediately obvious according to Wikipedia.

In your startup ideation process consider using lateral thinking.

Here are some steps to implement it:

Come up with a random word and apply it to the problem you are solving. 

This stimulates new lines of thinking.

Ask why five times.

Asking why five times takes you past the symptoms and to the root of the problem.

Examine your current thought patterns to alter your thinking to identify potential new approaches.

Consider alternatives to the current solutions and also to your proposed solution.

Invert the problem and solve it.

To do this solve the opposite of what you are trying to achieve which generates new ways of viewing the problem.

Break the problem down into smaller problems and solve each one.

Use a transitional object to inspire new ideas. 

For example, if you have a management problem look to a figure such as Abraham Lincoln for inspiration.

Ask what you should not do in order to narrow the problem solution set.

Use the subtraction technique in which you ask what would happen if we stopped doing X.

This generates new ways of framing the problem.

Consider these techniques for fostering lateral thinking in your ideation process.

 

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.

_______________________________________________________

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Category:general -- posted at: 5:00am CST

Lead Users in Ideation

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Lead users are the early pioneers looking to solve a problem.

They face problems that need to be solved in advance of the general market providing a solution.

Lead users start well ahead of the mainstream market so they create their own solutions.

They can be a great source of inspiration for startups seeking new business opportunities.

To use lead users for your ideation process, consider the following:

Identify the problems to be solved.

Look for the leading edges of a new market.

This is often not in the mainstream market but rather a niche market.

Identify lead users in the niche market that are already working on a solution.

They are often found in research labs, academic institutions, and other startups.

Create a set of interview questions.

Interview the lead users to capture their proposed solutions.

Collect the resulting interviews and analyze the various approaches and strategies they used.

Share the results in a report with others on the team.

 

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.

_______________________________________________________

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Direct download: Lead_users_in_ideation.mp3
Category:general -- posted at: 5:00am CST

Brainstorming in Ideation

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Brainstorming can be an effective tool in the ideation phase of a startup.

It works best when focused on the right elements.

The startup exists to solve a customer problem.

Here are some steps to consider for your brainstorming in the ideation phase:

Start with a list of customer pain points.

Make a list of disruptive technologies that have recently come on the market.

Apply each disruptive technology to each pain point to find a solution.

Analyze and score each match on market size, competition, how well the solution fits, capital requirements, and barriers to entry.

Take the best matches and apply recent business model innovations to each matched pair.

Analyze and score each one on how well it solves the problem and monetizes.

Finally, take the top problem, technology, and business model matches and research the market by talking with customers and current providers in the space. 

It’s best to start with a pain point that is strong enough to motivate someone to pay for it. 

Nice to have solutions rarely go very far so focus on real problems.

Avoid starting with disruptive technologies or new business models as this leaves out the most important element: a paying customer.

 

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.

_______________________________________________________

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Direct download: Brainstorming_in_ideation.mp3
Category:general -- posted at: 5:00am CST

Key Mental Models for Ideation

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

There are several approaches to ideation for a startup.

Consider these mental models for your ideation:

Solving a customer problem -- focus on reducing the cost or increasing the convenience of the solution.

Transfer a solution -- this takes a solution from one industry and applies it to another.

Disruption -- provide a better solution to an existing market where the competition is antiquated.

Replicate success -- take a successful business and apply the business model to another industry or application.

Bundling -- create a new product by bundling two or more functions together.

Unbundling -- take a current business apart by creating a solution for a subset of its offering.

Remove the intermediaries -- create a solution that removes the middleman.

Predict the future -- extrapolate current trends to identify how the future will look and build a solution for that.

Backcasting -- develop a non-consensual view of the world and develop solutions for that world.

Consider these mental models in ideating for your next 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.

_______________________________________________________

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Direct download: Key_mental_models_for_ideation.mp3
Category:general -- posted at: 5:00am CST

Startups Are Not Big Companies

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Big companies are those who have found product-market fit and have encapsulated their repeatable and scalable business model into processes.

Big companies who want to achieve innovation will find that they are not startups.

Startup ideation creates new ideas that disrupt those existing processes.

New business models, products, and concepts often don’t fit into the big companies' current programs.

They have metrics and KPIs that track the current processes.

This is why it’s hard for big companies to innovate.

While big companies may want to innovate they rarely have the tools in place to do so.

The processes and programs for generating startup ideas are different from those that are optimized to execute on them at scale.

To launch a startup ideation process many companies create a separate group that can run under different metrics.

This group uses metrics that track startup ideas, investigations, market validation, and other steps.

They have a different incentive plan that fosters new idea creation, validation, and testing.

They often reside outside the firm’s location as the culture and mindset are also different.

If you are considering startup ideation at your work, keep these points in mind.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Category:general -- posted at: 5:00am CST

What Is Ideation for Startups?

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Ideation is a thought process that takes conceptual ideas into implementation.  

Founders launching a new startup go through the ideation process to generate the concept for the business.

Ideation comes from the current knowledge of the problem to be solved molded by principles and convictions. 

Ideation often comes from brainstorming sessions, social media posts, webinars, and others.

Ideation focuses on solving a problem by generating new approaches to find a solution.

To perform ideation consider the following:

Start with a problem to be solved.

Identify the key pain points the user faces.

Draw on the ideas of others to create potential solutions.

Consider inverting the problem so you can approach it from another perspective.

Consider making incremental changes to create a derivative solution.

Consider combining several small solutions to create a new solution.

Ideation draws from the work of other companies as well as the founder's experiences.

Ideation fosters innovation by reverse engineering a problem.

Consider the role of ideation in 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.

_______________________________________________________

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Direct download: What_is_ideation_for_startups.mp3
Category:general -- posted at: 5:00am CST

How to Use Ideation in a Startup

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Ideation is a key stage in the startup process of developing a product or service.

Founders use it to question the obvious and come up with a new solution.

To pursue ideation in your startup, consider the following:

Generate many ideas whether they are workable or not.

Setup a place where no idea is a bad idea.

Ask the question, “How could we” to generate new possibilities.

Use analogies to draw ideas from other sources to apply to your situation.

Put yourself in the place of the customer and role play the customer’s experience.

Use brainstorming to generate new scenarios and outcomes.

Challenge the assumptions behind the current solutions.

Use mind-mapping by writing out keywords and visually connecting ideas around it into a diagram.

Capture the user personas and talk through the story of that user to find new solutions.

Finally, use the wish technique in which you ask what the user wishes for.

Capture all ideas into written form to share with the team and use for testing.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Category:general -- posted at: 5:00am CST

Criteria for a Good Idea

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In ideating for a new product, there will be many ideas.

Up front consider all ideas and then qualify each one.

To judge the ideas consider the following:

Put yourself in the place of a customer and ask if you would buy that product.

Good ideas come from solving a customer's pain point.

Does it solve a real problem that customers will pay money for?

Consider what resources are needed to bring it to market.

Test out the business model behind the idea to see if it works.

It takes substantial time and work to bring an idea to fruition.  

Are you interested in working on that idea for a substantial amount of time?

Does the idea excite you?

In fact, do you have a passion for the idea?

Do you believe it is not just a solution but it is "the" solution

Narrow the list down to three and test out those ideas. 

 

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.

_______________________________________________________

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Disrupt or Create

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In ideating a new startup you can either disrupt an existing market or create a new one.  

In disrupting an existing market consider the following:

Move the transaction and delivery of the product online.

Online capabilities generate network effects.

One can create data sets and include fintech payments as part of the experience.

One can also create cost and time efficiencies by eliminating the middleman.

Disrupting an existing market requires a new mindset for serving the customer.

In starting a new market, consider the following:

Emerging technologies provide the opportunity to create a new market. 

Technologists and early adopters comprise the initial market. 

Since they are familiar with the technology they adopt it first. 

As the technology matures it will reach a wider audience which creates a new market.

Fast-growing technology segments provide an opportunity as well.  

As crypto takes off, it generates many new markets to serve.

Applying a new business model can create a new market as well. 

In ideating for your startup ask which approach is appropriate.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Startup_Funding_Espresso_--_Disrupt_or_create.mp3
Category:general -- posted at: 5:00am CST

Signs of a Bad Startup Idea

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In reviewing startup ideas for your business here is a list of signs pointing to bad ideas:

You know absolutely nothing about the market, product, or community.

While great startups come out of new domains, it’s helpful to have some experience with the space.

You spread yourself across too many ideas and don’t gain depth on any one of them.

It’s important to prioritize and go in-depth on one idea at a time.

You choose an idea for which you are not a good fit.

Look for ideas that match your skills and interests.

There’s no business to be had but only work to be done.

There are many socially conscious ideas but in the end, it must be run as a business with revenues and profits.

The idea is hard to explain.

You must be able to craft a story around it to sell it.

Your idea requires customers to change their behavior.

Changing behavior is hard. Your idea must generate a very high return to achieve behavior change as it will take substantial time.

You are mostly guessing about the market and customers and have not actually engaged with either.

It’s important to talk to customers and spend time in the market to understand how it really works.

Ask yourself how many of these apply to your startup idea and eliminate those from your 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.

_______________________________________________________

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Direct download: Startup_Funding_Espresso_--_Signs_of_a_bad_startup_idea.mp3
Category:general -- posted at: 5:00am CST

Screening Startup Ideas

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In reviewing startup ideas here is a list to screen them:

Are you excited about the idea or just okay with it?

You should have some sense of excitement about it.

Does anyone else think it’s a good idea?

It helps to have some validation from others, especially those on your team.

Can you find someone willing to pay for it?

While it may not be a full market test, it’s helpful to know that someone will pay for it.

Are you the right person for this idea?

There should be a fit with your skills and experience.

Is now the right time to pursue this idea?

Timing is important to startup success and should be at play here.

Ask yourself how many of these apply to your startup idea to see if you should pursue 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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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On this episode of Investor Connect, Hall welcomes Adam Spector, Co-founder, and COO of AbstractOps.

Located in San Francisco, CA, AbstractOps automates all the key aspects of running a startup. This includes covering the Human Resources (HR) function, documents & contracts, financial (such as payments, taxes, and accounting), and compliance/regulatory. AbstractOps combines everything into a single platform tied to the best 3rd party software platforms in the world (such as Gusto, Carta, Quickbooks, and more), which means that with a single click of a button, a user can now automate processes end-to-end that would otherwise take dozens of steps.

Adam Spector is a 3x founder, angel investor in a dozen unicorns, and a GP in a VC fund. 

Prior to his current company, he worked in product at Twitter with a focus on APIs. His prior startup, LiftIgniter, was a machine learning personalization company acquired by Maven. He also led sales & GTM activity at Datalogue, an ETL machine learning business acquired by Nike. 

He has focused his investing activities on game-changing startups with driven, dedicated founders. Some of his best investments to date include: BetterUp (executive coaching), Human Interest (401ks), Diamond Foundry (synthetic diamonds), Checkr (background checks), Zoox (self-driving cars), Relativity Space (3d printed rockets), PayJoy (loans), Ginkgo Bioworks, Jet.com, Blockfi, August Smart Lock, Certn, Boom Supersonic, On Deck, Equi, Placer.ai, Inversion Space, Attentive and many others.

With his team member, Adam is the General Partner of the Operator Fund, which invests in early-stage startups with a relationship to AbstractOps. 

Adam advises startups and investors and discusses the state of startup investing. 

Visit AbstractOps at www.linkedin.com/company/abstractops/about/; www.abstractops.com; twitter.com/abstractopsco.

Reach out to Adam at: www.linkedin.com/in/adamspector2/; ops@abstractops.com; adam@abstractops.com; twitter.com/aspec00.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org  

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Direct download: Adam_Spector_of_AbstractOps.mp3
Category:general -- posted at: 5:00am CST

Testing Your Ideas at Low Cost

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

It’s important to validate your startup ideas.

Here’s a list of low-cost methods to do so:

Search the web for competitive solutions.

Look at how they are positioned in the market relative to your idea.

Do any of those solutions have recurring revenue?

Research those competitors to learn more.

Build a landing page on your website and place your proposed product on it.

Drive traffic to the page using direct email and see how many signups you get. 

Check the search traffic to see how many keywords you can use and how much they cost.

Test your page with a few key search words to see what results it brings.

Promote the proposed product on social media.

See what feedback you get for it.

Try variations of the product, price, and promotion to see how that changes the results.

You don’t need a shipping product or even one in development to see how it will be perceived. 

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Startup_Funding_Espresso_--_Testing_your_ideas_at_low_cost.mp3
Category:general -- posted at: 5:00am CST

The Acid Test of Startup Ideation

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

It’s easy to generate startup ideas.

It takes work to research and validate them.

Once you qualify an idea apply the acid test to it.

The acid test is can you set up a repeatable process for generating revenue with it.

Create a low-cost, simple version of the product you can use to test it.

Build a landing page on your website and then use a small amount of money to buy online ads and drive traffic to it.

Track the number of people who come to your page and how many clicks through to buy.

Track how much express interest in buying your product.

If you can provide a version of your solution at this stage fulfill the sale.

Communicate with the prospect to answer their questions and learn why they are buying your product.

This is a great way to learn how to improve the product.

Track the conversions to purchase.

Run this process again and see if you get the same results for traffic, click-throughs, and orders.

If you can show a repeatable, predictable process then you have the core of a working business.

You can test different price points and product positionings to improve 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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Startup_Funding_Espresso_--_The_acid_test_of_startup_ideation.mp3
Category:general -- posted at: 5:00am CST

Identify Your Startup Idea Advantages

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In validating your startup idea look for these advantages:

Does your idea resonate with the potential buyer?

Your buyers should be excited about it when you tell them.

Is your idea perceived to be better than the competition?

Buyers should see the advantages right off the bat without too much explanation.

Is the idea easily understood and grasped by the buyer?

The idea should be clear to the buyer without confusion.

Does your idea give the buyer the opportunity to try it before buying it?

If the buyer can try it out first then this will be helpful in the marketing process.

Are the advantages of the idea clear to everyone?

Even non-users should see the advantages of it.

Does your idea have any defensibility against competition?

It helps to have some protection on the idea through intellectual property or trade secrets.

Note these advantages in testing your startup idea. 

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Start With the Problem

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Good startup ideas don’t come by looking for startup ideas.

They come when you find yourself saying “that’s interesting” as you notice someone trying to solve a problem.

To generate ideas for a startup, start with the problem to be solved.

Choose a problem you have so you avoid the mistake of building something no one wants.

Startup ideas are plentiful but ultimately you have to sell the solution to someone.

If you’re not solving a real problem, then it will be difficult.

Solutions to real problems attract people who are willing to pay.

To test your startup idea, ask the following:

  1. What is the cost of this problem to a person in dollars?
  2. What is the cost of this problem to that person in time spent?
  3. How many people have this problem?
  4. How many people who have this problem want to solve it right now vs later?

Focus on startup ideas that are must-haves.

Avoid ideas that are nice to have as they are hard to sell.

With practice, you can build the skill to identify good startup ideas.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Category:general -- posted at: 5:00am CST

Where to Focus Your Startup Ideas

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In searching for startup ideas here are some key points to consider:

  1. Start with a current solution to the problem you want to solve.
  2. Don’t change everything but instead only change one or a few things.
  3. Focus on one or two innovations such as the business model, the platform, or the market.
  4. Look for changes in the technology landscape and ride that wave.
  5. Find a new technology platform that is coming up and leverage it for your solution.
  6. Look for startup ideas that are not universally shared. 

If everyone believes in that idea, then there will be too much competition early on.

In addition to solving today’s problem, look to solve tomorrow’s problem. 

As the market grows it’s clear which problems will increase and which will decrease.

Look for startup ideas that leverage your skills.

Target a market, technology, or resources you may have that give you a competitive advantage.

Consider the essential elements of your solution and focus on those.

The grand vision is never in place on the day you launch the product.

It will take several years to reach that final vision.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Where_to_focus_your_startup_ideas.mp3
Category:general -- posted at: 5:00am CST

On this episode of Investor Connect, Hall welcomes Judah Taub, Managing Partner at Hetz Ventures.

Hetz Ventures was founded in 2018 and is headquartered in Tel Aviv with additional partners operating out of London.

Hetz Ventures is a leading Israeli seed-stage venture capital firm taking a thematic approach to early-stage investing. With nearly $300M under management, the fund invests in and supports startups in DevOps, Dev Tools & Open Source, AI/Data, Fintech, Cybersecurity, and other enterprise verticals.

Judah previously served as Head of Data at Lansdowne Partners (a $20B London-based Hedge Fund) as well as advising multiple young start-ups.

In his service in the Israel Defense Forces, Judah served as an officer in a classified intelligence unit where he engineered a large-scale project to win the IDF 2014 Creativity Award.

He has lectured widely, including throughout the IDF and at Wharton Business School, on time management and creative thinking and wrote a book for new IDF soldiers published by Yediot, Israel’s leading publisher. Judah was also elected as one of Forbes 30 Under 30 for 2020.

Judah advises startups and investors and discusses his investment thesis.

Visit Hetz Ventures at www.hetz.vc, on LinkedIn at www.linkedin.com/company/hetz-ventures, and on Twitter at www.twitter.com/HetzVentures

Reach out to Judah at jtaub@hetz.vc and on LinkedIn at www.linkedin.com/in/judah-taub-3773247b/

_______________________________________________________

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Direct download: Judah_Taub_Hetz_Ventures_.mp3
Category:general -- posted at: 5:00am CST

Questions to Test Your Startup Ideas

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

After startup ideation comes to the testing phase.

It’s important to test your startup idea with these questions:

How many people need your solution?

Is that enough people to make the business work?

Consider how many customers you need at your chosen price point to make the business model work.

Then estimate how large the market must be as only 1-3% of the customers will buy from you.

Can you access those customers easily and at a reasonable cost?

If it’s too expensive to acquire customers the business model may not work.

Is the problem painful enough that they are actively looking for a solution?

It helps if the customer is looking for you rather than you trying to find them.

Are customers willing to pay for it?

If so, how much will the majority pay?

Based on these questions you can eliminate many startup ideas and focus on the ones that work.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Questions_to_test_your_startup_idea.mp3
Category:general -- posted at: 5:00am CST

Tracking Your Startup Ideation Progress

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

It’s important to track your progress in startup ideation.

Metrics should be used from the very beginning to measure your progress.

Here are some steps to take:

Track the number of customers contacted and provided feedback.

Measure the number of customers who try out the product. 

Capture the amount of revenue each customer would pay for the product and calculate the average.

This sets a basic rate of customer interactions you can use to price your product and calculate revenue.

As you develop minimum viable products and launch beta programs continue to track the metrics. 

For marketplaces, track the number of buyers and sellers on the platform as well as the number of product listings with revenue per transaction.

After several product launches, you can establish a standard startup ideation program for your company.

This standard will inform how many customer calls must be made and how long the process will take.

This will reduce the cost and time overruns for the project and increase the accuracy of your pricing model early on.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Category:general -- posted at: 5:00am CST

Signs of a Great Startup Idea

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In reviewing startup ideas for your business here is a list of signs pointing to good ones:

  1. Growth -- there’s a growing market around it.
  2. Broad-based -- a lot of people have the problem you are trying to solve.
  3. Urgent -- people need to solve the problem immediately.
  4. Mandatory -- the problem must be solved and cannot be ignored.
  5. Frequent -- the problem comes up regularly and not just once in a while.
  6. Budget -- the customer has enough funds to pay for the solution.
  7. Authority -- your customer has the authority to buy the solution.
  8. Experience -- you know well the problem and the market. 
  9. Network effects -- you can build network effects into the solution and gain those advantages.
  10. Switching costs -- the solution is sticky and difficult to move out of it.

Test your startup idea with these conditions to see how well it works.

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Signs_of_a_great_startup_idea.mp3
Category:general -- posted at: 5:00am CST

The False Pretenders

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Emerging technology markets bring several challenges to the investor.

These markets are new and cutting edge but are also immature, unevenly distributed, and opaque.

In the early days, it’s not clear what the real winner will look like.

In many emerging markets, the false pretender precedes the winning solution.

In the 1990s, the Palm Pilot and the Newton were early versions of mobile technology.

They both met the form factor requirement, but the processing power, applications, and other factors fell far short of customer requirements.

Later the iPhone took over the market when it met those expectations.

In analyzing startups in emerging markets, look for the false pretenders to see what features they bring and what they don’t bring to the market.

Notice the key missing features.

Roadmap the path to providing those features.

For processing power, it’s clear how fast chips are progressing, so it’s not hard to estimate when the processing power will be available.

There’s some money to be made in funding the false pretenders.

It’s important to know where the startup is on the roadmap and how long it will take for the technologies to mature.


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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: The_False_Pretenders.mp3
Category:general -- posted at: 6:00am CST

Portfolio Tracking

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In running a VC fund, you’ll need to set up a system for portfolio management.

You’ll need to provide quarterly and annual reports to the Limited Partners, so it’s important to set up a system for tracking the investments.

Select a portfolio management tool that generates basic metrics such as IRR.

For VC funds you’ll also need Distributed to Paid-In capital (DPI), and Total Value to Paid-in Capital (TVPI) calculations. 

Your system should be able to track each investment with cost basis and current valuation.

Here are some key data elements to capture for each investment:

Date of investment

Amount of funds invested.

Pre and post-money valuations

For convertible notes, you’ll need to include the cap on your conversion price along with discounts and accumulated interest.

Include warrants and any other holdings the fund may have.

Setup a template to produce a report each quarter and annually.

Keeping the system up to date will make it easier to manage.

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Portfolio_Tracking.mp3
Category:general -- posted at: 6:00am CST

How to Find Startup Ideas

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

There are several ways to find startup ideas.

Here are three methods to consider for your ideation efforts:

Look to the future and ask yourself the following questions:

How are people changing?

What long-term problems do they have to deal with?

How have values shifted over time? 

How has technology changed?

What can we do now that we couldn’t do before?

Look to the current successful innovations and ask the following questions:

How can we improve on that innovation?

What can we do to make it easier, cheaper, and better?

How can we make it 10X better than it is now?

Solve problems you have encountered and ask the following questions:

What is your biggest pain point at work, home, or in a hobby?

How could it be solved better?

What would I pay for the solution I’m envisioning?

How many other people have this problem?

Use these methods to generate ideas for 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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Category:general -- posted at: 6:00am CST

This is the TEN Capital AMA show. I'm Hall T. Martin, the host of the show in which we interview investors and founders on current topics. 

Our guest is:

Yohan Jacob of Retailbound

I hope you enjoy this episode.

_______________________________________________________

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Impact Investing Metrics

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Many VC funds have impact investing as a part of the investment thesis.

Impact investing takes into account the social impact of the fund in addition to the financial return.

For impact investing, include metrics showing the impact of each investment.

There are several ways to measure impact.

For startups in well-defined areas, use the expected returns method, which determines if an investment meets threshold criteria.

For early-stage companies just starting, use the theory of change method, which estimates the social impact of those activities.

For startups in a well-defined sector use the mission alignment method, which measures operational activities and compares them to the industry standards.

For all other startups, use the experimental methods which calculate the results from each investment’s activities to determine the impact. 


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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Impact_Investing_Metrics.mp3
Category:general -- posted at: 6:00am CST

How Startup Ideation Works

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Startup ideation is a key step to building a successful company.

Here are the key steps to generate good startup ideas:

Surround yourself with people who have a feel for the trends and what’s coming next.

Look for disruptive innovations in technology.

Follow platforms and applications that are gaining wide adoption.

Ask yourself, ‘What can you do now that you couldn’t do a few years ago?’

This shows an ongoing trend you can project out into the future.

Look out ten years or more and ask, ‘What will the world look like then?

Work back from that vision of the future to how the world will reach that point. 

Ask, ‘What will be needed in that future vision that is not already invented?’

Look for opportunities that fit your skill set and experience.

Mock up an MVP and show it to lead users and early adopters for feedback.

It takes several years to build out a business model and brand so you must start early in building it.

Pursue several opportunities before choosing the one to pursue for the long haul.


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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: How_startup_ideation_works.mp3
Category:general -- posted at: 6:00am CST

Key Performance Metrics

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In running a fund, you’ll need to track key performance metrics.

Metrics should cover performance at all levels, including individual investments, the overall fund, and how it compares to other VC funds. 

Investors will want to see the numbers at all levels, including the following:

  • Fund’s investment cost and current valuation.
  • Total Value to Paid in Capital which is the value of the fund relative to what has been invested by the limited partners so far.
  • Change in value, quarter over quarter and year to date.
  • IRR numbers for investment exits.
  • Residual Value to Paid-in Capital.

There are also metrics for the limited partners' funds, including the following:

  • Capital committed, capital called, and the capital outstanding to be called.
  • Fees paid.
  • Limited partners’ percentage ownership.
  • Limited partners' cost basis and current valuation.
  • Change in value, quarter over quarter and year to date.
  • Total cash returned to limited partners.

Finally, include benchmark metrics comparing your VC fund to similar funds.

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Key_Performance_Metrics.mp3
Category:general -- posted at: 6:00am CST

Cost of Running a Fund

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In running a VC fund, there will be costs to cover. 

Here’s a list of key costs to include in your pro forma:

  1. Salaries for the partners and other employees.
  2. Benefits for the partners and employees.
  3. Office rent and related expenses such as utilities.
  4. Legal and accounting costs.
  5. Travel expenses for board meetings and events such as a CEO day.
  6. Limited partner meetings, including travel and dinners.
  7. Software tools such as a CRM.
  8. Subscriptions to publications and associations.
  9. Marketing expenses for lead generation and branding.
  10. Additional expenses for deal flow and advisor work.

You’ll need to budget funds for running the business and track the expenses.


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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Cost_of_running_a_Fund.mp3
Category:general -- posted at: 6:00am CST

Investment Returns on a VC Fund

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In a VC fund, limited partners look for greater returns.

The risks are higher, and the hold times are much longer, so LPs look for better returns than the stock market.

In general, they look for a 10-20% IRR better than the market index.

Historically, top VC funds have a Distributed Paid-In ratio of 3X while the Total Value to Paid-In ratio is 1.5X, not counting the dot-com era.

The manager of the VC fund can improve the performance of the fund in several ways:

Remember, IRR is higher the sooner the funds are returned to the LP.

A VC fund manager can increase the IRR by taking funds in a series of capital calls rather than all upfront.

Most funds ask for ⅓ of the invested capital up front and then two more capital calls in the following years.

In pledge funds, the LPs provide the funding for each deal as it arises.

Another option is to shift some of the management fees into the carry.  This will increase the return to the LPs.

Seventy-five percent of VC funds do not return anything to the limited partner after the fees are accounted for, and most limited partners know this.


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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Investment_Returns_on_a_VC_Fund.mp3
Category:general -- posted at: 6:00am CST

Compensation

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In setting up a VC fund, you’ll need to determine compensation for the partners and team members.

Most funds use the 2% management fee with a 20% carry model.

This means 2% of the funds raised will be used for salaries, along with 20% of any of the profits.

In a $100M fund, $20M would be available to pay salaries each year over the ten-year life of the fund or $2M.

Some funds pay the management fee more heavily in the first five years and less in the later years of the fund.

For funds under $25M, a 2.5% fee is more common.

The carry is the profit from the investments.  

In most funds, the limited partners must receive their committed capital back before carry is paid out to the general partners.

New funds sometimes offer a lower management fee to those limited partners who help raise additional funds.

Some funds forego the management fee and take their total compensation in carry.


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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Compensation.mp3
Category:general -- posted at: 6:00am CST

On this episode of Investor Connect, Hall welcomes Luigi Amati, Chairman at META.

META is an international advisory and investment firm dedicated to the creation of knowledge-intensive companies. The group’s main activities are research results exploitation, support for startup creation and scale-up, and early-stage equity investment.

Through dedicated and independent business units (academy, investment, advisory), META coaches researchers and knowledge-intensive startups, invests from proof of concept to scale up and advises European, national, regional, and local governments on innovation and entrepreneurship policy.

Luigi started out as a researcher, developing computational mechanics software for a spin-off of Imperial College London before founding META in 1993. He is an experienced researcher, entrepreneur, ecosystem-builder, and investor, and this gives him the possibility to navigate all stages of the “knowledge to market” journey and entrepreneurial life-cycle.

As an angel investor, in 2007, he was one of the nine founding members of “Italian Angels for Growth,” today the largest angel group in Italy, and he now serves as the Chairman of Business Angels Europe.

Luigi graduated Summa cum Laude in Engineering from the University of Rome and holds a Master of Science and a Diploma from Imperial College London.

Luigi advises startups and investors, and discusses his investment thesis and the state of angel investing.

Visit META at www.meta-group.com, on LinkedIn at www.linkedin.com/company/meta-group_2/, and on Twitter at www.twitter.com/meta_group

Visit Business Angels Europe at www.businessangelseurope.com

Visit Italian Angels at www.italianangels.net

Reach out to Luigi at luigi.amati@meta-group.com, on LinkedIn at www.linkedin.com/in/luigiamati/, and on Twitter at www.twitter.com/luigiamati2

______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org  

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Direct download: Luigi_Amati_of_META.mp3
Category:general -- posted at: 6:00am CST

How Many Partners?

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In setting up a VC fund, it’s important to select the right number of general partners for the fund.

Most funds have at least two partners to provide the necessary skills.

Some funds have one founding partner and then several venture partners to help.

Funds under $50M can afford only one partner with some administrative support since not all functions need to be done by a partner. 

For each $50M under management, you’ll need either a partner or a non-administrative team member.  

Funds over $50M can bring on analysts who do the industry research, screen the deals, and work on fund reporting.

For fund management, most funds outsource to fractional providers.

For marketing, most funds hire social media and branding agencies to help get the word out on the firm.

For advising the startups, most funds lean on the experience of the partners and their 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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: How_Many_Partners.mp3
Category:general -- posted at: 6:00am CST

Fund Managing Skills

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In choosing a manager for a VC fund, look for the following skills:

Ability to raise funding from Limited Partners

This means the manager has a network of potential investors and knows how to pitch.

Access to quality deal flow and the ability to vet potential investments.

This means the manager knows where to find deals and how to analyze them.

Ability to run due diligence on candidate investments.

Can determine valuation and negotiate terms with the company.

Knows how to find follow-on investors for the fund’s investment in the startups.

Ability to help funded companies be successful.

This involves coaching on how to staff the startup and what to focus on at each stage.

Ability to join the startup’s board and provide expertise, networking, and guidance.


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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Startup_Funding_Espresso_--_Fund_Managing_Skills.mp3
Category:general -- posted at: 6:00am CST

On this episode of Investor Connect, Hall welcomes Guy Remond, Co-founder and Partner at EHE Capital.

Headquartered in Altrincham, England, EHE Capital Limited is a highly efficient tech-led private equity organisation with a genuine focus on supporting entrepreneurs through their companies’ high growth stage through to a successful conclusion. They also provide qualified, high-quality deal flow for investors, private equity, and venture capital organisations. 

Guy’s working career began in retail, where he enjoyed an eleven-year stint in various managerial positions. Following this, he followed his passion for anything technical and branched out on his own into the technical world. In 2001 he was a founding member and CEO of Cake Solutions Limited, and over the next 16 years, he directly oversaw the development of the business from a small start-up to that of an international, multi-million-pound company respected as being at the cutting edge of engineering and process in the open-source software development world. 

After being recognised in the Deloitte UK Technology Fast 50 and being viewed as one of the most unique, forward-thinking, and fast-growth companies in the industry, Cake Solutions Limited was acquired by a multinational corporation, and the business was subsequently rebranded as Disney Streaming Services, which is a wholly-owned subsidiary of a company owned by The Walt Disney Corporation.

As a creative and widely experienced individual with a keen focus on personal development, company culture, and process improvement, Guy has invested in a number of companies and is actively working with these companies in a non-executive director or chairman role, helping them to fulfill the leadership's drive to a successful outcome. 

Guy is building two new organisations with his business partners Gary Fletcher and Dave Zumpano. 

In addition to his working commitments, Guy dedicates time to charitable activities. For well over a decade, he has worked with Variety - the Children's Charity in a number of voluntary roles, currently acting as the Chairman for the North West region in the UK and more recently as a Trustee for the organisation.

Guy shares his background and gives insight into starting a business in the area of private equity. He describes some of the opportunities and challenges and how he differs from his competitors.

Visit EHE Capital at www.ehe.capital, on LinkedIn at www.linkedin.com/company/ehe-capital/, and on Twitter at www.twitter.com/EHECapital.

Reach out to Guy at jguyremond@gmail.com and gremond@guidr.legal, and on LinkedIn at www.linkedin.com/in/guyremond/

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org  

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Direct download: Guy_Remond_of_EHE_Capital.mp3
Category:general -- posted at: 6:00am CST

Conflicts of Interest

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In setting up a VC fund, beware of conflicts of interest.

Funds associated with other groups such as universities, accelerators, or incubators may find a conflict with other funding activities in that group.

These groups are often focused on helping the startup launch.

This leads to funding startups that may not qualify for funding.

Make sure the fund is independent from the group and makes decisions based on the investors' best interest.

Set up the fund separate from the group with different leadership.

The fund could have first rights for any deals related to the group but is not obligated to invest.

Define the relationship between the group in the fund's documents, so it’s clear to the group, the fund managers, and the Limited Partners.

Also, review the fund manager's other commitments and relationships to make sure they are free and clear of other incentives.

If the fund manager runs other businesses, vet those businesses for any conflicts of interest as well. 

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Startup_Funding_Espresso_--_Conflicts_of_Interest.mp3
Category:general -- posted at: 6:00am CST

Communicating With LPs

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In launching a VC fund, you’ll need to set up ongoing communication with the Limited Partners called LPs.

It starts with setting expectations for the returns on the fund.  

In many cases, it’s 20% to 30% per year, with most funds returning capital in years 7 to 10.

For ongoing communications about the fund, set up a template to show the following:

  1. List of the portfolio companies with name, weblink, and main product.
  2. Include the funding date, valuation at the time of funding, and current valuation.
  3. Show exited companies with capital returned to investors.
  4. Show standard fund metrics such as IRR for the fund, Distributed to Paid-In capital (DPI), and Total Value to Paid-in capital (TVPI).
  5. Add a short summary of the portfolio companies and how they are doing. 
  6. Distribute the report each quarter and a more detailed version annually.
  7. Consider holding an annual meeting in which the LPs can meet the CEOs and discuss directly about their company.

It’s important to be transparent at every step of the way as all information is ultimately made known to the LPs.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Startup_Funding_Espresso_--_Communicating_with_LPs.mp3
Category:general -- posted at: 6:00am CST

Sourcing Deal Flow for the Fund

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In running a VC fund, you’ll need to set up deal flow sources and run screening processes.

First, set up three to five quality deal flow sources that provide a consistent flow of startups to review.

Maintain those relationships and provide feedback to the deal flow source about what you are seeing and what you are looking for.

It takes more than telling people what you look for, it takes reminding too.

There are a large number of deals seeking funding.

You’ll need to set up a process for selecting deals to review in depth.

Start with basic deal flow criteria around revenue, sector, and stage.

Spend a minute or two on each deal to determine if it fits your criteria.

If it does, then spend a few more minutes reviewing the deal for showstoppers.

For deals that pass the initial screen, set up a call to discuss.

Design an efficient process for meeting startups -- conference calls, local coffeeshop, your office, etc.

If the meeting goes well, ask for a standard set of documents such as a pitch deck and recent financial statements.

Meet with the team to discuss the deal and invite for a pitch to the rest of the team.

Allocate 15 hours a week to deal-flow sourcing, including screening, calling, and meeting new deals.

As soon as you reach a ‘no’ decision, tell the startup so they are not kept waiting.

 

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.
____________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: Startup_Funding_Espresso_--_Sourcing_Dealflow_for_the_fund.mp3
Category:general -- posted at: 6:00am CST

On this episode of Investor Connect, Hall welcomes Wen Zhang, Fundraising and Startup Advisor, Pitch Expert, Professional Speaker, Founder and CEO of INNW Institute, and Host of “If Not Now, Wen, Podcast.” 

Headquartered in Austin, Texas, the INNW Institute helps individuals, from first-time founders to seasoned executives, polish their pitch, develop the strategy and execute a vision.

Making a perfect pitch is like making a peanut butter jelly sandwich. It requires the perfect amount of peanut butter on one slide, which is all the business fundamentals, such as your business model, pricing strategy; on the other hand, you need the right amount of strawberry jelly, which is your passion, your why, the way how you tell the story. We need the right amount of both on the bread to make a perfect bite.​

Dreaming of venturing into the world while growing up in an isolated mountain town in rural China, Wen completely transformed her life by teaching herself English using a cassette machine. Despite countless challenges, she pushed forward to become the only person who ever left her hometown and achieves her dream of seeing the world four years later.

Wen succeeded (and failed) in both the startup and corporate world and has experience in software, hardware, and service-based business models. She also has experience in launching a new business, expanding the market internationally, and scaling and managing global enterprise business. In a Fortune 500 company, she is leading a $320M yearly product portfolio while managing 400 sales teams across the North American region. She is passionate about supporting founders to grow and scale their ventures, working through their business model as well as the pitching process to connect and resonate with investors and customers via pitch deck.

On her podcast, you will meet different entrepreneurs who have accomplished unimaginable feats to share their dreams, the ups, the downs, and everything in between, while giving you a peek behind the curtains of how they make it possible!

Wen holds a Master's Degree in Marketing and Advertising from the University of Illinois, Urbana-Champaign, and a Master of Business Administration (MBA) from Duke University.

Visit the INNW Institute at www.ifnotnowwen.com, and on LinkedIn at www.linkedin.com/company/innw-institute.

Listen to the If Not Now, Wen, Podcast at www.ifnotnowwen.com/podcast

Reach out to Wen at wen@ifnotnowwen.com, and on LinkedIn at www.linkedin.com/in/wenzhangdukemba/.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org  

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Wen_Zhang_of_INNW_Institute.mp3
Category:general -- posted at: 6:00am CST

Team Skills Required

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In setting up your VC fund, you’ll need to build a team that can make it successful.

Here are the critical skills required:

  1. Business expertise and knowledge of the industry.
  2. Basic finance related to startup investing.
  3. Sales and marketing as it relates to startups. 
  4. Knowledge of the current technology in the sector.
  5. Ability to work with people and evaluate people, including CEOs.
  6. Convincing investors to invest in your fund.
  7. Ability to work with partners and deal-flow sources.
  8. Experience with startups in general.
  9. Ability to handle high-growth sales and marketing.
  10. Knowledge about where to spend and where not to spend in a startup's growth.
  11. Ability to size up and handle competition.
  12. Ability to manage the startup through difficult times.
  13. Finally, access to a network and a brand for sourcing deal flow and working with other investor groups.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Startup_Funding_Espresso_--_Team_Skills_Required.mp3
Category:general -- posted at: 6:00am CST

Designing the Fund

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In setting up your VC Fund, you’ll need to consider the structure and philosophy behind it.

Here are some key points to determine:

  1. The fee structure and how it relates to the current market rates.
  2. The size of the fund and the general partners’ investment amount.
  3. The number of companies the fund will invest in.
  4. The initial investment amount and follow-on investment amount.
  5. Deal sourcing through the partners or outside firms.
  6. Stage of the company to invest in -- Seed, Series A, or later.
  7. Fund investment thesis -- by industry, market, or technology.
  8. Investment criteria and standards.
  9. Expected performance of the fund.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Designing_the_Fund.mp3
Category:general -- posted at: 6:00am CST

On this episode of Investor Connect, Hall welcomes Jay Cormier, Founder and CEO of Eyedaptic.

Headquartered in Orange County, California, Eyedaptic offers a comfortable wearable device that uses proprietary vision-enhancing software that effectively simulates a person’s natural vision. Designed in conjunction with leading ophthalmology retinal specialists, low vision optometrists, and occupational therapists, AdaptiVu is completely non-invasive and worn like glasses. As a battery-powered optical vision aid, this device is considered FDA exempt.

The Eyedaptic team is a combination of seasoned technology executives with multiple successful exits along with key opinion leaders in Ophthalmology, Optometry, and low vision, and together have developed and validated the product with a clinical study and hundreds of hours of beta usage. The peer-reviewed clinical study established a five times improvement in tasks of daily living and, on average, over a doubling of visual acuity. Eyedaptic is currently running a pilot program and working on its next product for expansion in the United States and then worldwide. In addition, their partnership with the world leader in low vision aids leads to an efficient and effective path to scaling user engagement, as well as possible early exit scenarios.

Jay is an experienced technology executive and entrepreneur with a strong track record of founding, growing, and turning around businesses. Jay has led marketing, sales, engineering, operations, strategic partnerships, business development, new product strategy, and execution, and achieved results using his expertise in building high-performance, multi-disciplinary teams. Jay earned his BS in Electrical Engineering from Worcester Polytechnic Institute and an MBA from Northeastern University, and is active in Tech Coast Angels, Orange County Chapter, as well as mentoring at the University of California, Irvine Merage Business School.

Jay discusses how he sees the AI medical device industry evolving, the growth rate of the sector, how Eyedaptic fits into the landscape, online sources he finds useful, and more.

Visit Eyedaptic at www.eyedaptic.com, on LinkedIn at www.linkedin.com/company/eyedaptic/, and on Twitter at www.twitter.com/eyedaptic?lang=en.  

Reach out to Jay at jay.cormier@eyedaptic.com, and on LinkedIn at www.linkedin.com/in/jay-cormier-8615474/.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org  

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Jay_Cormier_of_Eyedaptic.mp3
Category:general -- posted at: 6:00am CST

Fund Reporting

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In setting up your VC Fund, you’ll need legal and accounting support.

Look for providers who have done the work before and bring experience to the project.

You don’t want to pay people to learn on the job.

You’ll need legal support to set up the fund documents.

You’ll also need legal in shutting down the fund at the end of the term.

For accounting, you need to find a firm that has done partnershipS and passed through taxation work before.

Here are some key points with regards to reporting:

  1. Track the portfolio valuation and the performance of the fund, including Distributed Paid In and Total Value to Paid In metrics.
  2. Track expenses for tax reporting purposes.
  3. Create templates for the reports to the limited partners, including spreadsheets for calculating metrics and distribution lists of investors.
  4. Maintain a list of updates from the portfolio companies with their results.

 

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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Fund_Reporting.mp3
Category:general -- posted at: 6:00am CST

Accounting and Governance

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

There are specific rules for the governance of a VC Fund.

The limited partners must be accredited investors.

There can be no more than 99 investors in the fund.

There can be no “bad actors” in the fund. 

Venture funds are different from companies in that they are partnerships.

For accounting, fund managers need to keep accurate records and track the ownership of each Limited Partner.

The funds are illiquid with long holding periods.

Management fees need to be calculated and drawn from the fund at the appropriate time.

The fund manager must calculate the carry and make clear what has been paid.

The manager should seek tax efficiency by matching the taxes to the income.

Finally, the manager should provide financial reports quarterly and annually.


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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Accounting_and_Governance.mp3
Category:general -- posted at: 6:00am CST

How to Track and Report Results

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In running an angel group, it’s important to capture and report the investment results to the members.

Here are some key points to consider:

  1. Capture the investments made into a portfolio management system, so everything is in one place.
  2. Keep the system up to date with all new and follow-on investments.
  3. Each quarter, send out a report showing the number of investments made and the number of deals funded.
  4. Note any major transactions such as recent fundings, exits, and other news.
  5. Capture the latest valuations to include in the portfolio to generate an intermediate estimate of value.
  6. Make sure the members understand this is not a guarantee but only an estimate.
  7. For exits, capture the amount distributed to the investors and maintain a running investment returns number for the group, including IRR.
  8. For major fundings, consider publishing a press release about the funding to the community.

This generates deal flow and investor signups.


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.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: How_to_Track_and_Report_Results.mp3
Category:general -- posted at: 6:00am CST

On this episode of Investor Connect, Hall welcomes Drew Glover, Managing Director at FiatGrowth.

FiatGrowth is a $15 million venture capital fund specializing in early-stage funding for fintech companies that are striving to provide social good for their customers. Since 2021, Drew and the team at Fiat Ventures have supported over 100 entrepreneurs, with 67% of them being from communities that are underrepresented in the tech space. 

FiatGrowth’s vision is to scale products and services that are accessible to all, and they are breaking down barriers and aligning the most impactful companies to collaborate and empower the global consumer, regardless of socioeconomic status.

As Managing Director, Drew oversees Business Development & Strategic Partnerships. Previously Drew held VP of Marketplace positions at Steady where he helped them grow their user-base to 1.5M+ users and built their job and benefit marketplace. Before Steady, Drew held Director positions at HRtech giant Namely and design consultancy Fjord, which was acquired by Accenture NYSE: ACN, as well as digital media and branding agency Portal A. He has helped companies like Adidas, Nike, JP Morgan Chase, Home Depot, and Best Buy bring award-winning services to market. Drew loves cooking and traveling with his wife Michelle. 

Drew shares what excites him now and how he sees the fintech sector evolving. He advises startups and investors, discusses what he thinks is going to have the biggest impact in the next five years, his financial thesis, and more.

Visit FiatGrowth at www.fiatgrowth.com, on LinkedIn at www.linkedin.com/company/fiatgrowth/, and on Twitter at www.twitter.com/fiatgrowthllc.  

Reach out to Drew at drew@fiatgrowth.com, on LinkedIn at www.linkedin.com/in/drewbailerglover/, and on Twitter at www.twitter.com/DrewBailer.  

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org  

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Drew_Glover_of_FiatGrowth.mp3
Category:general -- posted at: 6:00am CST

How to Manage the Diligence Teams

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In running an angel group, managing the diligence process is key to successfully funding deals. 

Here are some points to consider in managing the diligence process:

Write out the diligence process for others to use and include templates and key questions to answer.

Setup a standard diligence process schedule with a number of hours for each step.

The more team members you recruit, the fewer hours each team member must commit.

Set expectations for the level of work to be done.

Put the diligence documents online along with a diligence report so everyone on the team can access it. 

Review the diligence report every few days to check progress.

Include a previous diligence report to give the diligence team an example to review for the format, depth, and analysis.

Hold weekly conference calls to check the status with the team and what challenges may arise.

Set up a communication channel with the startup as most diligence processes require more information than was initially submitted.

Give feedback on the report to show where the team should spend time -- in short, where the investors have concerns.


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.

______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: How_to_Manage_the_Diligence_Teams.mp3
Category:general -- posted at: 6:00am CST

VC Fund Core Documents

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In raising a fund, you’ll need to set up the legal documents that define how and when the limited partners provide the funds, what the fund manager will do with those funds, and how they will return the funds back to the limited partners. 

Here are some key details to include in a fund document:

  1. Show who will manage the fund and what duties they have.
  2. Discuss the fees and expenses for the fund managers.
  3. Define profits and losses and how they are calculated.
  4. Consider tax implications for the investors and maximize for tax efficiency.
  5. Describe circumstances in which the limited partners must make a decision, such as adding new investors or extending the fund.
  6. Show compliance with the laws around tax, transfers, and liability of the members.
  7. Include indemnifications by the fund for the general partners in the case of damages. 
  8. List the redemption rights, if any, by limited partners. 
  9. Finally, discuss the distribution of profits, losses, assets, and the dissolution of the fund.


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.
___________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: VC_Fund_Core_Documents.mp3
Category:general -- posted at: 6:00am CST

On this episode of Investor Connect, Hall welcomes Dr. Ipshita Mandal-Johnson, Co-founder and CEO, and Giorgio Reggiani, Co-founder and CFO at Global Bio Fund.

GBF is a value-capital fund with a gender smart lens investing in bio sectors, including digital health. They invest and scale women-led bio ventures at early and growth stages, especially those based in the US, UK, Australasia, and selected high-growth emerging markets.

GBF has also created GBX, a network that consists of a diverse and experienced group of investors, entrepreneurs, scientists, experts, and organizations that support women-led bio ventures that are growth and impact-oriented.

Ipshita currently serves on the advisory boards of Proximie, Chiasma NZ, and Global Engineering Futures. She is a Judge on Mass Challenge and Women in Bio and a member of Global Women and UNAIDS HIEx Investors Council. She is a Visiting Lecturer at the Harvard School of Public Health and the University of Cambridge Chemical Engineering & Biotech.

Ipshita has worked with academia, corporates, and ministries in biotechnology, health, deep technology, and financial services. She has led strategy, policy, and implementation projects in policy development, capacity building, business development, fundraising, and transformation. She started her career in New Zealand and has since worked in the US, UK, and India, amongst others.

For her full bio, click here.

Giorgio is passionate about working with teams that want to make a difference by helping them to create and realise optimum value. Co-founder of a leading European venture capitalist firm, a software configuration company, an antibiotics discovery company (sold to Summit in 2017), and a rare diseases therapies biotech (sold to Astellas Pharma) in 2020 and spun companies out of British Telecom & Toshiba and managed listed companies in London and Sydney.

For his full bio, click here.

Visit Global Bio Fund at www.globalbiofund.org, on LinkedIn at www.linkedin.com/company/global-bio-fund/, and on Twitter at www.twitter.com/GlobalBioFund.  

Reach out to Ipshita at ipshita.mandal.johnson@globalbiofund.org, and on LinkedIn at www.linkedin.com/in/ipshitamj/.

Reach out to Giorgio at giorgio.reggiani@globalbiofund.org, and on LinkedIn at www.linkedin.com/in/giorgioreggiani/

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org  

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Direct download: Ipshita_Mandal_Johnson_and_Giorgio_Reggiani_of_Global_Bio_Fund_2.mp3
Category:general -- posted at: 6:00am CST

Startup Boards -- Investing in Startups

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

There’s an old angel saying, “Angels like to have a little fun, do a little good, and make a little money.”

Investing is more than just about money. I’ve found my successful investments covered all three of the elements of the old angel saying. It was fun. The people were great to work with. It had an element of making the world a better place, albeit on a small scale. Finally, it provided a positive return on investment so I could continue funding startups.

Have a little fun

Pursue deals you like. If you don’t like the deal, then nothing else will matter. Ask yourself, “Do I want to work with these people?” “Do I value the work they are doing?” If you can answer “yes” to these questions, then you are well on the path to finding a deal that  lets you ‘have a little fun.’  

Do a little good

Once you have a deal you like, then ask, “Does the company align with my interests?” Invest in startups that further that in which you believe. You may want to support your local entrepreneur ecosystem or a technology that can solve problems that benefit the general public.  

Make a little money

Get agreement on the terms of the investment with a defined exit. 

If you can help the company, then consider setting up an advisory position with them. 

One of the biggest sources of burnout is uncompensated work. There’s an almost unlimited amount of work that needs to be done, and the startup will load you up. 

Remember, successful investments let you make some money, have some fun, and do some good.


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.
____________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Investing_in_Startups.mp3
Category:general -- posted at: 6:00am CST

Startup Boards -- 3X in 3 Terms Sheets

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

The biggest challenge in investing in startups is finding the exit.  

Time value of money is important and should be part of your return metrics.

Startup investors look for a 44% IRR.  

IRR is Internal Rate of Return and represents the return on investment with respect to time, unlike ROI, which is return on investment without respect to time.  

Startup investors occupy a unique place in the startup funding ecosystem.  

Startup investor funding is the first money in after family and friends funding.  

The longer you stay in the deal, the greater your risk for dilution by follow-on investors.  

The key to a successful exit is a deal structure that gives some control after making the investment.

Equity-only term sheets give investors little say in the future of the company or how to exit.  

To achieve an exit, you must define it yourself, as the vast majority of startups will not do so. 

You must have it in writing before you invest.

Trying to come to an agreement with the startup after investing is almost impossible as the gap between the startup and the investor is too great to close. 

One way to define the exit is to add redemption rights into the agreement.

An example of this is the 3X in 3 terms sheet.

The deal structure is a Convertible Note with a redemption right for 3X your investment to be returned at year 3 of the investment at ‘Investor Sole Discretion.’   

At the third anniversary of signing the note, the investor has the option to convert the original investment to a three times return ($100K in is $300K out) or to go on the cap table as an equity investor.

In reality, there are many choices. In most cases, the startup is motivated to keep your funds in the deal and will negotiate terms to achieve 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.
____________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

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Direct download: 3X_in_3_Terms_Sheets.mp3
Category:general -- posted at: 6:00am CST

Startup Boards -- Foundation for Startup Investing

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Startup investing is a risky business. Not all the investments will work out.  

Know your risk tolerance and how much risk you want to take.  

Most investors allocate 3 to 10 percent of their investments into startup investing. Allocate a specific amount of funding for your investments.

You need to invest across ten deals to gain diversification, so take your funds allocation and set an amount or range for each investment. 

Follow-on funding is also a factor, so be prepared to invest again in many of those companies.  Consider taking your allocation per deal and dividing it into two -- one for the upfront investment and the other for a follow-on funding.

Consider what is important to you and invest in companies that align with your goals and vision.

You may want to support your community or industry. You may want to foster diversity or create jobs.  Or you may want to mentor entrepreneurs or keep your skills up to date. 

In the end, it’s the “Why” you invested that will matter the most. 


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.
___________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
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Direct download: Foundation_for_Startup_Investing.mp3
Category:general -- posted at: 6:00am CST

On this episode of Investor Connect, Hall welcomes Mike Jarmuz, General Partner at Lightning Ventures.

Headquartered in NYC, NYC, Lightning Ventures is an exclusively Bitcoin-focused network of investors, operators, and developers, dedicated to supporting lightning network adoption worldwide.

Mike Jarmuz… or Muzz…is a General Partner at Lightning Ventures and is focused on investing in Bitcoin companies. His goal is to evangelize and demystify early-stage investing to plebs and whales alike. Mike is also passionate about educating founders and operators on strategies to fund their projects. Muzz believes everyone should invest in technology companies (not just the suits) and that investing in Bitcoin companies is the best thing a pleb can do to compliment their HODL position. What else? Mike also co-organizes the Unconfiscatable Conference, and is an advisor to Azteco. He has a serious angel investing addiction and has invested in over 1500 companies. Some of his Bitcoin investments are Fold, Swan, The Bitcoin Company, Impervious, Start9, Breez, Scarce City, and more. 

Mike speaks about investing in Bitcoin, how he sees the industry evolving, and some of the challenges investors and startups face.

Visit Lightning Ventures at www.ltng.ventures, on LinkedIn at www.linkedin.com/company/lightning, and on Twitter at www.twitter.com/ltngventures.

Reach out to Muzz at mike@ltng.ventures, on LinkedIn at www.linkedin.com/in/mike-jarmuz-573b5658/, and on Twitter at www.twitter.com/MikeJarmuz.   

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org  

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Direct download: Mike_Jarmuz_of_Lightning_Ventures.mp3
Category:general -- posted at: 6:00am CST

Startup Boards -- Becoming an Angel Investor

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

For those who want to become an angel investor to fund startups, here are some key steps:

Meet accredited investor requirements. You must meet the SEC criteria for accredited investors. You can see the specifics on the SEC website. In short, you must have a $1M net worth, not counting the house you live in.

Startup investing is risky -- angel investing is high reward with high risk. Be prepared to lose money as it’s a part of the process.

Learn from other angel investors -- read, discuss, join. Read up on the subject. Discuss with existing angel investors, and join an angel network in person or online to learn more about it.

Listen to podcasts -- one of the best ways I learned about angel investing was through podcasts showcasing investors talking about how they invested.

Develop your investment thesis -- determine what you want to invest in and why it should work.  

Meet with startups and start learning about deal flow -- review the documents and term sheets to become familiar with the process. 


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.
___________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Becoming_an_Angel_Investor.mp3
Category:general -- posted at: 6:00am CST

Where Does the Angel Play?

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

So, what startups do angel investors pursue?

Angel investors invest in high-growth startups, most often tech-enabled.

Restaurants, retail, and service businesses are not necessarily a fit for angel investors.

Angels seek a return on investment in the range of 44% IRR.

While some angels are looking for home runs, most angels invest in deals that are singles and doubles for returns as they don’t have the deep pockets to fund a startup all the way.

Angels look for capital-efficient deals and have the opportunity to scale.

Those startups with recurring revenue are preferred. 

Angels invest in businesses that, for the most part, have an initial product and are going into the market.

They look for companies that, for the most part, can run themselves.  

Unlike the VC, which earns a paycheck through their management fee, the angel has no management fee, so all costs come out of pocket, and all time comes from the angel investor’s own time.


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.
___________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Where_does_the__Angel_Play.mp3
Category:general -- posted at: 6:00am CST

On this episode of Investor Connect, Hall welcomes Gordon Henry, Host of Winning on Main Street Podcast and Chief Strategy Officer at Thryv.

Winning on Main Street Podcast is geared towards helping small businesses with tips and knowledge to run their business in today’s evolving landscape. 

Thryv is a secure, easy-to-use small business management platform that automates tasks and puts your customers at the center of your business. They’ve been around in one form or another for more than 125 years, always with one goal in mind — helping small businesses compete and win.

Thryv provides the technology, software, and local business automation tools small business owners need to manage their time better, communicate with clients, and get paid, so they can take control of their business and be more successful.

Gordon is passionate about helping small businesses grow, modernize, and thrive in today’s evolving environment. Gordon has spent decades helping small businesses with client acquisition strategies and marketing. He is also a leader in enhancing a company’s image through public relations, brand management, and advertising. Gordon received his Bachelor of Arts from Yale University and an MBA from the Wharton School at the University of Pennsylvania.

Gordon speaks about automation in the startup world, CRMs, what he attributes the success of his podcast to, and more.

Listen to Winning on Main Street Podcast at www.winningonmainstreet.com.

Visit Thryv at www.thryv.com, on LinkedIn at www.linkedin.com/company/thryvinc/, and on Twitter at www.twitter.com/Thryv.

Reach out to Gordon at gordon.henry@thryv.com, on LinkedIn at www.linkedin.com/in/gordonhenry/, and on Twitter at www.twitter.com/gordonmhenry.  

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org  

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
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Direct download: Gordon_Henry_of_Winning_on_Main_Street_Podcast_and_Thryv.mp3
Category:general -- posted at: 6:00am CST

Startup Boards -- Startup Investor Skills -- Managing the Portfolio

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Startup investors need to hone their skills in order to succeed over the long run.

Key skills include: 

  1. Evaluating teams.
  2. Assessing products and markets.
  3. Accessing financial capital not only for the current round of funding but for later stages.
  4. Managing a portfolio of startup investments, including supporting the startup and generating exits.

In managing a portfolio, you need to provide support to the startup at some level.

It’s best to invest in businesses that you can help, so this should be part of your investing criteria.

You need to track the companies in your portfolio and keep up to date with them at least once a quarter. 

At some point, you may need to help the startup generate an exit by making introductions to companies who could acquire the startup.

A potential buyer will want to see the startup’s organization align with its own structure.  

The investor can help the startup align with the acquirer.  

This process becomes the growth strategy of the 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.
___________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
For Startups check out: https://tencapital.group/company-landing/ 
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Direct download: Startup_Investor_Skills_--_Managing_the_Portfolio.mp3
Category:general -- posted at: 6:00am CST

Startup Boards -- Startup Investor Skills -- Accessing Financial Capital

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Startup investors need to hone their skills in order to succeed over the long run.

Key skills include:

  1. Evaluating teams.
  2. Assessing products and markets.
  3. Accessing financial capital not only for the current round of funding but for later stages.
  4. Managing a portfolio of startup investments, including supporting the startup and generating exits.

So for accessing financial capital, you need a network of investors both at the stage in which you invest and for the stage after.

For the current round, you may need to help the startup finish its current raise.

Referring them to investors who may be a good fit will help them succeed.

Reserving funds for their next round is also important. Many investors divide their total allocation to the startup in half, investing half in the first round and the other half in a follow-up round.

For their follow-on round, it’s useful to know investors at that stage so you can make introductions there as well.


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.
____________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
For Startups check out: https://tencapital.group/company-landing/ 
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Direct download: Startup_Investor_Skills_--_Accessing_financial_capital.mp3
Category:general -- posted at: 6:00am CST

Startup Boards -- Startup Investor Skills -- Evaluating the Product & Markets

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Startup investors need to hone their skills in order to succeed over the long run.

Key skills include: 

  1. Evaluating teams.
  2. Assessing products and markets.
  3. Accessing financial capital not only for the current round of funding but for later stages.
  4. Managing a portfolio of startup investments, including supporting the startup and generating exits.

So for the product, ask, is it a vitamin or a painkiller?

The vitamin makes you stronger and better, but it’s nice to have for the customer.

The painkiller is more important to the customer and, in some cases, crucial.

It’s better to invest in painkillers than vitamins.

For markets, you look for large markets, not small ones.  

Ask, where in the lifecycle is this market -- early stage, growing, maturing, or declining?

You want a market that is growing or about to start growing because of disruptive technology.

It’s important someone on the team knows the market very well.


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.
___________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
For Startups check out: https://tencapital.group/company-landing/ 
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Direct download: Startup_Investor_Skills_--_Evaluating_the_product_and_market.mp3
Category:general -- posted at: 6:00am CST

On this episode of Investor Connect, Hall welcomes Joseph O'Bell, Attorney, Founder of Vineyard Sun LLC, and Host of the Moontower Business Podcast.

The Moontower Business Podcast was launched when the pandemic started. The goal was to showcase entrepreneurs and the business community in Austin, Texas. The podcast quickly evolved and began to cover entrepreneurs and business leaders all over the United States. The podcast has featured interviews with entrepreneurs and business leaders in a vast array of industries. Some of the guests include billionaire Peter Rex, Austin Mayor Steve Adler, former Texas Secretary of State Carlos Cascos, Jehudi Castro, Advisor to the President of Colombia, venture capitalist Sean Sheppard, Nik Bhatia author and Professor at USC Business School, and many more. 

Joseph is General Counsel for American Metals Recovery and Recycling Inc. as well as Multiband Global. He has practiced civil litigation and transactional work. Joseph has worked in the Texas Emerging Technology Fund in the Texas Governor’s Office and as General Counsel of a startup company called Votalize Inc. He is also the Founder of Vineyard Sun, LLC, an eCommerce sunglasses company based in Austin.

Joseph discusses the implications of the influx of persons into Austin, Texas, the bitcoin industry there, his podcast, and more.

Listen to the Moontower Business Podcast at www.moontowerbusinesspodcast.com, and on Twitter at https://twitter.com/MoontowerB.  

Visit Vineyard Sun LLC at www.vineyardsun.com.  

Reach out to Joseph at joey.obell@multibandglobal.com, joseph@moontowerbusinesspodcast.com, on LinkedIn at www.linkedin.com/in/joseph-o-bell-2451621b/, and on Twitter at www.twitter.com/NY_TX_Lawyer/

_____________________________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org  

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
For Startups check out: https://tencapital.group/company-landing/ 
For eGuides check out: https://tencapital.group/education/ 
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Direct download: Joseph_OBell_of_Moontower_Business_Podcast.mp3
Category:general -- posted at: 6:00am CST

Startup Boards -- Startup Investor Skills -- Evaluating the Team

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Startup investors need to hone their skills in order to succeed over the long run.

Key skills include: 

  1. Evaluating teams.
  2. Assessing products and markets.
  3. Accessing financial capital, not only for the current round of funding but for later stages.
  4. Managing a portfolio of startup investments, including supporting the startup and generating exits.

So for the team, the basis of any relationship is integrity.  

The team needs to be in it for the long haul. Startups are the ultimate marathon game.

They need to know their market and their customer -- very well.

Finally, they need to inspire confidence.

The CEO, in particular, needs to recruit others to the company including customers, employees, and partners.

Those who can inspire others to join the cause will do well. 


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.
___________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
For Startups check out: https://tencapital.group/company-landing/ 
For eGuides check out: https://tencapital.group/education/ 
For upcoming Events, check out https://tencapital.group/events/  

For Feedback please contact info@tencapital.group   

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Music courtesy of Bensound.

Direct download: Startup_Investor_Skills_--_Evaluating_the_Team.mp3
Category:general -- posted at: 6:00am CST

Startup Boards -- 3X in 3 Term Sheet Walkthrough

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

The TEN Capital Early Exit term sheet includes a 3X redemption right, giving the investor the sole discretion over their right to 3X their investment at the three-year mark from the date of the investment. 

A redemption right gives the investor or startup a right to redeem an ownership stake in the company. 

The term ‘Investor Sole Discretion’ means the investor has the sole decision on taking the redemption right.

The company typically pays back in a lump sum or a series of monthly payments spread over 6 to 12 months. Since it can be a rather large cash outlay, some companies start escrowing money a year in advance.

If the company cannot pay, then a workout plan is negotiated. The terms of the redemption right give investors consent rights over the company’s cash expenditures.  

There’s an interest rate set in the note for ongoing accumulation while the funds are kept in debt form.  

The interest is not paid out but rather rolled into the equity amount should the investor give up the redemption right and go onto the company’s cap table.

In the event of an early exit, the interest payment continues till the debt is paid off. 

The returns are treated as long-term capital gains.

Startups using this structure include tech, healthcare, and consumer product goods with at least $500K of annual revenue.  

If the revenue is lower than that, the company is at risk of startup failure. If it’s above $500K, then it will most likely remain an ongoing business. 

If the company declares bankruptcy, then depending on the outstanding debt the company is holding, the investor could lay claim to the assets, which in most cases include the patents.  

There is also an opportunity to take over the business.  

Finally, it’s a tax return write-off.


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.
___________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
For Startups check out: https://tencapital.group/company-landing/ 
For eGuides check out: https://tencapital.group/education/ 
For upcoming Events, check out https://tencapital.group/events/  

For Feedback please contact info@tencapital.group   

Please follow, share, and leave a review.

Music courtesy of Bensound.

Direct download: 3X_in_3_Terms_Sheet_Walkthrough.mp3
Category:general -- posted at: 6:00am CST

On this episode of Investor Connect, Hall welcomes Ian A. Brown, Attorney, Appraiser, Florida Real Estate Broker, and Founder of Yield Coach.

Located in Jacksonville, Florida, Yield Coach is a real estate thought-leadership platform with both educational and investment concentrations.

Ian is an experienced and dynamic real estate professional. Prior to founding Brown Brothers Realty, Ian was a senior consultant at a commercial real estate firm specializing in valuation and real estate analytics. In addition to being a licensed real estate broker, Ian is also a licensed appraiser and earned his J.D. from the Florida Coastal School of Law. His responsibilities include investment sales, debt restructuring, tax appeal, buyer and seller representation, property valuation, highest and best use analysis, and tenant and landlord representation. Through his diverse and well-rounded experience, Ian is able to apply creative approaches to assist clients in reaching their investment goals, as well as navigating their real estate challenges.

Ian’s background and exposure are fundamental to the Yield Coach platform and will allow students to look at deal structures differently and close larger deals (at better returns) than most new investors would have achieved.

Visit Yield Coach at www.yield-coach.com and on LinkedIn at www.linkedin.com/in/yieldcoach/.

Reach out to Ian at ian@yield-coach.com and on LinkedIn at www.linkedin.com/in/ian-a-brown-esq-64a4236a

_____________________________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org  

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
For Startups check out: https://tencapital.group/company-landing/ 
For eGuides check out: https://tencapital.group/education/ 
For upcoming Events, check out https://tencapital.group/events/  

For Feedback please contact info@tencapital.group   

Please follow, share, and leave a review.

Music courtesy of Bensound.

Direct download: Ian_Brown_of_Yield_Coach.mp3
Category:general -- posted at: 6:00am CST

Startup Boards -- How to Perform Diligence in a Group

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In performing due diligence in a group of investors, it helps to assign roles and responsibilities.

There are three phases to diligence:

  1. Documentation diligence
  2. Team diligence
  3. Domain diligence

The lead investor should take the three steps and assign each of these to one person or group.

Assign the first team to review the key documents and write a short report on what the company has and if there are any discrepancies with the submitted documents.

Assign the second group to review the startup team. Meet with the team, assess their skills, and write a short report.  In most cases, you’ve heard the CEO pitch, but it’s important to understand the CEO’s skills set, including what is there and what is not.  

Assign the third group to research the competition. The group should check the positioning of the company in the marketplace.

Identify the value proposition and how well it resonates with customers. 

Look at their pricing compared to the competition.

Check the industry to see the conditions in which it will grow or decline.

Remember to write down in one document the findings to share with others.

The lead brings the group together to review the results and check any red flags. 

Shared documents and folders make this step 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.
___________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
For Startups check out: https://tencapital.group/company-landing/ 
For eGuides check out: https://tencapital.group/education/ 
For upcoming Events, check out https://tencapital.group/events/  

For Feedback please contact info@tencapital.group   

Please follow, share, and leave a review.

Music courtesy of Bensound.

Direct download: How_to_Perform_Diligence_in_a_Group.mp3
Category:general -- posted at: 6:00am CST