Series A Crunch: Bootstrapping Works

Just because you have been rejected by VCs doesn’t mean you cannot build a great business.

Marc Benioff was rejected by pretty much ALL the VCs he approached. Didn’t stop him from building Salesforce.com into a multi billion dollar enterprise with global impact.

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Series A Crunch: Forget Freemium

What is your business model? Do you have one, or is it TBD?

Is it Freemium?

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Series A Crunch: Obsession With Exit

Do you know the difference between a business model and an exit strategy?

Are you building a business that has a real, viable business model?

Or are you trying to do an Instagram?

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Series A Crunch: Tyranny of the TAM

What is TAM? Perhaps, the biggest factor in whether a VC funds you or not. TAM = Total Available Market.

Note: Top Down TAM doesn’t matter. You need to present a Bottom-Up TAM Analysis.

And to get funded, that TAM needs to be very large. Billion. Two billion. Ten billion.

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Series A Crunch: Revenue vs. Equity

Do you understand the impact of infusing cash into your business? You do, right?

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Series A Crunch: Customers vs. Investors

What have you been doing for the last six months? Chasing customers? Chasing Investors?

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Series A Crunch: Real vs. Pseudo Entrepreneurs

Much is being said on a daily basis about the Series A crunch. This is our series on the subject. In short, byte-sized posts, I will give you my thoughts on how to deal with the issue. Please note, this advice is entirely for entrepreneurs, not investors.

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Having Trouble With Series A Funding?

There is a lot of talk right now that Series A funding has gotten difficult for the tens of thousands of entrepreneurs who have received angel financing over the last 18 months. Some data from PEHub:

According to the University of New Hampshire’s Center for Venture Research, the number of active angel investors topped 300,000 last year, up 20 percent from 2010. The ranks of the matchmaking service AngelList also swelled, with 2,500 investors joining the community last yearalone, most of them in the last six months. (When AngelList got its start in the spring of 2010, it listed 80 accredited investors.) A study from UNH shows that angels put a fresh $9.2 billion to work in the first half of this year, a 3.1 percent increase over the same period in 2011.

Meanwhile, the number of firms that are actually investing is dwindling, despite the best efforts of partners to save face. The NVCA pegs the official number of “active” traditional firms at 500, but according to NVCA President Mark Heesen, this number is misleading, because at least 200 of the firms only do a deal or two a year.

Last year, some 66,230 companies received $22.5 billion through angel investors, up from 36,000 receiving $15.7 billion in 2002, according to the Center for Venture Research at the University of New Hampshire.

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