The Entrepreneurial Bible to Venture Capital: Inside Secrets From the Leaders in the Startup Game

The Entrepreneurial Bible to Venture Capital: Inside Secrets From the Leaders in the Startup Game

by Andrew Romans
Released August 2013
Publisher(s): McGraw-Hill
ISBN: 9780071830362

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Book description

40 leading venture capitalists come together to teach entrepreneurs how to succeed with their startup

The Entrepreneurial Bible to Venture Capital is packed with invaluable advice about how to raise angel and venture capital funding, how to build value in a startup, and how to exit a company with maximum value for both founders and investors. It guides entrepreneurs through every step in an entrepreneurial venture from the legalities of raising initial capital to knowing when to change tactics.

Andrew Romans is the co-founder and general partner of Rubicon Venture Capital, a venture capital fund that invests in privately held technology companies and enables its investors to co-invest along side the fund on a deal-by-deal basis via innovative sidecar funds right up to IPO or M&A exit. Romans is also the founder and general partner of The Founders Club, a venture capital equity exchange fund and investor in later stage liquidity transactions.

Table of contents

  1. Cover
  2. The Entrepreneurial Bible to Venture Capital: Inside Secrets from the Leaders of the Startup Game
  3. Copyright Page
  4. Contents
  5. List of Contributors and Interviewees
  6. Foreword by André Jaeggi
  7. Introduction
  8. 1 Start Me Up!
    1. Why Now Is a Great Time to Start a Company, Be a Venture Capitalist, Be an Angel Investor, or Invest in a VC Fund
    2. BranchOut: The Textbook Case Study for Superb Angel Advisory Round and VC Funding
    3. Add Angel Dignitaries to Your Series A VC Round
    4. Why Entrepreneurship Is Becoming Increasingly Important and Why Angel Investing and Venture Capital Are Here to Stay
    5. Getting Started
    6. We’ve Got to Start a Company
    7. When to Start Up?
  9. 2 Angels, Mortals, and Super Angels
    1. The “Startup Cambrian Explosion”
    2. Ron Conway, Super Angel
    3. Accelerators
    4. Tech Stars and the Rise of Accelerators
    5. Online Funding Resources
    6. Crowdfunding: Everything You Always Wanted to Know but Were Afraid to Ask
    7. Practical Ideas and Advice on Raising Angel Funding
    8. How to Recruit and Negotiate with Advisors
    9. Convertible Note Versus Priced Round
    10. Valuation Ranges for Pre-Money Caps on Seed-Stage Convertible Note Financings
    11. Don’t Raise Angel Funding at Too High a Valuation
    12. Raising Angel Funding
    13. Steve Jobs Rated by His VC
    14. The Team Means Everything
    15. A Balanced Team
    16. Recruit a First-Class Team Contingent upon Funding
    17. Choose Your Investors Wisely
    18. Building Blocks of Pre-Money Valuations
    19. Pitch Lawyers before Pitching Angels
    20. Legal Fees for Startups: Fixed Pricing
    21. Legal Factors to Consider When Choosing an Angel Investor
    22. Smart Angels Flock Together
    23. Pledge Funds
    24. The Importance and Art of Networking
    25. Never Turn Down a Smart Strategic Investor
  10. 3 How Venture Capital Works
    1. Understanding VC Titles
    2. To the Victor the Spoils
    3. The Stock Market and Venture Capital
    4. Where Do VCs Get Their Money?
    5. Why Are VCs So Arrogant?
    6. Old School Venture Capital: Pitch Johnson on the Early Days of Silicon Valley
    7. Romans Five Forces Venture Model: Incentives Are Not Aligned
    8. Corporate VCs
    9. Family Offices
    10. The Difference between Venture Capital and Private Equity
    11. A Perspective on the Difference between VC and PE
    12. What About Venture Debt?
    13. This Is Not Your Mother’s Venture Debt
    14. Pick the Right Partner the First Time
    15. Questions You Should Ask Your Venture Debt Partner
    16. Venture Debt Terminology and Term Sheets Revealed
    17. Why Venture Debt Is an Attractive Asset Class
    18. Fund of Funds
    19. More Than Matchmakers Between GPs and End Investors
  11. 4 What to Bring to the Dog and Pony Show!
    1. Business Plans
    2. Executive Summary
    3. Investor Slide Deck
    4. Financial Model
    5. Characteristics of the Best Spreadsheet Models
    6. Investor Control Schedule
    7. Demo and Video
    8. The Pitch
    9. Five VCs Explain What They Really Think About Your Pitches
  12. 5 Practical Ideas and Advice on Raising VC Funding
    1. Getting on the Radar of Your First Choice VC
    2. How Should an Entrepreneur Approach Negotiation of the Key Terms?
    3. How to Negotiate with a Venture Capitalist
    4. Don’t Tell VCs Which Other VCs You Are Talking To
    5. Confidentiality: No NDAs or Secrets in the Fast Lane
    6. Bridge Financing
    7. Living from Round to Round
    8. Employ an Army of Interns
    9. Customer Financing
    10. Dual Tracking
    11. Venture Fratricide
  13. 6 Corporate Governance: Who’s The Boss?
    1. The VC That Wanted a Board Seat
    2. Engaging the Board of Directors
    3. Making Your Board Work for You
  14. 7 Company Building and Growing Value
    1. Distribution Versus Product
    2. Skype: Where is Your Button on Kazaa?
    3. Facebook: The Balance Among Product, End User Experience, and Advertising
    4. MySpace: Pimp Out Your Contacts
    5. YouTube: How to Extend Beyond Your Domain
    6. The Marketing Myth
    7. The Blackmail Business Model
    8. The Nine-Year Overnight Success
    9. Just Grab the Bird and Lower Yourself Out of Those Clouds
    10. How to Come Up with True Innovation That Drives the Rest
    11. Picking a Name
  15. 8 Which Way to the Exit?
    1. M&A Is the Most Likely Positive Outcome for Most Entrepreneurs
    2. Practical Ideas and Advice When Selling Your Company via M&A
    3. Three Kinds of Business Buyers
    4. How Instagram Secured a $1 Billion Valuation
    5. Advice on the $300 Million Sale of Adify
    6. How Liquidation Preferences and Carve Outs Play in Exit Scenarios
    7. How to Smoke Out the Serious VCs in Your Syndicate
    8. Large Trade Sales of Private, Venture-Backed Medical Device Companies
    9. Acqui-Hire Early Exits: VCs Versus Founders
    10. Several Perspectives on Acqui-Hires
    11. Seek Truth in Facts: Statistics on Venture Exits
    12. Fund Physics: Expect Improved IRRs from Smaller Funds
  16. 9 Do We Need All These Lawyers?
    1. What Are the Key Terms in a Term Sheet?
    2. No Time Like Right Now to Settle a Legal Dispute
    3. Dumb Licensing
    4. Letting a Licensee Get Out of Control
    5. Sometimes You Have to Go Downhill to Get to the Top of the Next Hill
    6. It Is Better to Be Lucky Than Good
  17. 10 Ladder to Liquidity: The Secondary Market
    1. How Early-Stage Angels and VCs Can Get Their Cash Back Prior to an Exit
    2. To Sell or Not to Sell: The Secondary Market for Startups
    3. The Direct Secondary Market: Selling Some of Your Shares for Cash Before a Liquidity Event
    4. Founders’ Preferred: Best Structure for Founder Early Liquidity
    5. Direct Secondary Funds
    6. When to Take Your Chips off the Table
    7. The Founders Club Equity Exchange Fund Model
  18. Afterword
  19. Acknowledgments
  20. Index

Product information

  • Title: The Entrepreneurial Bible to Venture Capital: Inside Secrets From the Leaders in the Startup Game
  • Author(s): Andrew Romans
  • Release date: August 2013
  • Publisher(s): McGraw-Hill
  • ISBN: 9780071830362