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Insanity

I see plans where there is no company, a one man army. There are obviously no customers and no revenues. There is a spreadsheet which shows an exit valuation of $50MM. The entrepreneur wants to raise $1.4 MM and is prepared to invest the princely sum of $10,000 including money from friends and family. Obviously […]

Distance Education

Professor Mehta a member of the Knowledge Commission resigned in protest on quotas/reservations in educational institutions. His open letter to the Prime Minister is circulating on email and I read it on a Yahoo Group for my batch from IIM Ahmedabad. My response to that mail is quoted below as some of you may find […]

TieCon Silicon Valley – Videos

Silicon Valley had its TieCon couple of weeks back. Wahindia brings its coverage on the event. Would particularly recommend Shashi Thuroor’s one-on-one interview where he talks about the winds of globalization and its influence on cultures around the world.

Instep Gartner Trends

Alok talked of out of step entrepreneurs. It is easy sitting in India to be instep. Towards that some technology trends mentioned by Gartner 1. Commoditization & consumerisation – makes tech more affordable 2. Virtualization & Tera Architechtures – Granular components that find each other and self assemble into a computing resource 3. Software Delivery […]

Out of step entrepreneurs

Have been spending a lot of time here in bay area of late, and have been seeing a fair bit of startups here. One thing that strikes me is how naturally the “market knowledge” comes to the whole community, including the founders and investors. Some of the plans I see within India are out of […]

Next Big Thing/Bubble ?

In Silicon Valley there are some that believe that 1998 is back and worry again about a bubble building up. They point to a large number of startups being funded pursuing the same ideas. Oopen source etc. reduce barriers to entry . Their argument is that it is a bad time to start a company […]

Company Board

Running/Leading a Board is a big challenge which often becomes worse when a VC joins the board. Entrepreneurs should put in the disciplines ahead of time Some tips from “Venturing Forward” 1. Successful board meetings are ones with no surprises – making decisions not trading information 2. Fiduciary responsibility is paramount 3. Controlled meeting 4. […]

Term Sheets

The biggest negotiation is the Term sheet 1. Abbreviated v/s Industry Standard 2. Used to negotiate full deal structure with legal advice 3. Question of exclusivity 4. Key terms to negotiate (besides price) a. Participating preferred b. Full ratchet anti dilution c. Large liquidation preference d. Veto/controls Some links to industry standard term sheets NVCA […]

Venturing Forward – Valuation

A VC serves two masters. Investors in the VC fund and entrpereneurs. Normally the way VC’s get paid is 2 and twenty. 2% of committed capital as a management fee and 20% of profits. 80% goes back to investors. Valuation must be managed through multiple dependent rounds of financing while considering 1. Ability to attract […]