Archives / August, 2008

What Are the Pros and Cons of Investment From a Strategic Entity?

Q:  Can you please touch on issues associated with first round financings from corporate or strategic investors. Particularly when the strategic is a competitor. What are some of the pitfalls and opportunities associated with this type of an investor in an early stage company? A: (Jason)  There are both potential positives and negatives taking money…

How Should I Approach a VC I Don’t Know?

Q:  Everyone tells me the way to approach a venture capitalist I don’t know is through a friendly introduction from someone who already knows that VC. But what happens if I don’t have the connections to get that introduction? Am I screwed? A:  (Chris) Every entrepreneur who has raised venture capital has heard it a…

Paul Graham on Fundraising

Today’s great post is from Paul Graham and is titled A Fundraising Survival Guide.  Paul runs Y Combinator and has been involved in numerous early stage financings since starting Y Combinator several years ago.  Worth a long, slow, and detailed read for any entrepreneur raising money for their startup.

Answer The Question Honestly

Rick Segal has today’s great post up titled From the Trenches: OS Who?  In addition to being enlightening, it’s hilarious.  He’s also got some hints about where OS/2 is heading.  Updated: Rick provides some clarification on what he was trying to say in his post Ruh Oh – Time for a butt whoppin (mine).

How Many Deals Should Be Needed To Return A VC Fund?

Fred Wilson has another excellent post up titled Venture Fund Economics: When One Deal Returns The Fund.  He continues his expose on how VC funds work and builds his thoughts in this post around the statement: "Every really good venture fund I have been involved in or have witnessed has had one or more investments…

How Gross and Net Returns Work For Venture Funds

Fred Wilson has another post on Venture Fund Returns titled Gross and Net Returns.  AsktheVC would like to formally thank Fred for doing our work for us, as we periodically get questions about how VC funds work and to this point have not written posts nearly as detailed as Fred’s.

How Venture Fund Economics Work

Today’s great post if by Fred Wilson titled titled Venture Fund Economics.  "When I write about venture fund returns, there are always comments and questions that lead me to believe that the economics of a venture fund are not well understood. And since most of the readers and commenters on this blog are people who…

Is Dilution Considered When Talking About Equity Ranges?

Q: When we talk about the equity percentage numbers for those directors and other early participants, are these numbers based on the total number of shares prior to a funding event or does the base share number include those allocated for investors as well? As the shares for future investors are hard to predict, I…