Investor Connect

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Investor Connect: Dr. Chris Apfel of SageMedic Corp.

On this episode of Investor Connect, Hall welcomes Dr. Chris Apfel, Founder, CEO, & Chairman of the Board at SageMedic Corp. Located in Palo Alto, CA, USA, SageMedic Corp. (SAGE) is a cancer diagnostic company that brings precision medicine to the next level by overcoming the limitations of genomic testing. Specifically, because only 1 out […]

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Operating Revenue

Operating Revenue Operating revenue is revenue from the core business. Non-operating revenue is revenue that comes from other sources. For example, if the company sells a service, that revenue is considered operating revenue. If the company sells a piece of furniture, that revenue is considered non-operating revenue. By separating the operating from the non-operating revenue […]

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Accrued Revenue

Accrued Revenue Accrued revenue is revenue that has been earned but has not yet been paid for. This could be project work that is billed when completed. The unpaid balance for the work done is considered accrued revenue. This applies to project work as well as loans in which the interest income is considered accrued […]

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Unearned Revenue

Unearned Revenue SaaS businesses charge a subscription fee for the product on a monthly or annual basis.  For those charging on an annual basis, the revenue generated at the beginning of the contract is considered unearned revenue. Unearned revenue is revenue received before the service actually occurs. The unearned revenue is not an asset, but […]

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Components of Revenue

Components of Revenue Revenue or sales stands for the amount of funds a company earns. This comes from the goods or services the company sells. This is often called Gross Sales or Total Sales as it’s the total amount of the proceeds. Net sales are the gross sales minus any returns, discounts, or other price […]

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Types of Revenue

Types of Revenue Not all revenue is the same as there are several types of revenue. SaaS companies earn different types of revenue through their product offering. Here’s a list to consider: Software licenses are quite valuable as one can charge recurring fees for them. Maintenance fees can also be valuable as they often recur […]

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Investor Connect: How to Invest Series 02

On this episode of the How to Invest Series, Hall revisits the insights of Dennis Coleman, from Life Science Angels, Ipshita Mandal-Johnson, from Global Bio Fund, Mark Groper, from Orion Biotechnology, Allison Piper Kimball, from Wave 27 Ventures, and Neal Vail, from Progenerative Medical, Inc. What do they all have in common? The answer to […]

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What Impacts the Quality of Revenue?

What Impacts the Quality of Revenue? Not all revenue is the same. Investors look at the characteristics of the business which impacts the quality of revenue. Revenue that comes from a source that will sustain longer will have a higher value to investors. Here’s a list of characteristics investors use to assess the value of […]

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Solving the Chicken and Egg Problem

Solving the Chicken and Egg Problem In launching a marketplace platform you must solve the chicken and egg problem. You must have supply to engage buyers and buyers to engage suppliers. In the early days, you’ll need to do things that don’t scale such as recruit supply that is not in the network for a […]

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Marketplace Platform Evolution

Marketplace Platform Evolution Marketplace platforms evolve over time. Platforms start by connecting buyers and sellers. They follow with additional services such as ratings and reviews, background checks on the buyers, and quality control on the suppliers. Over time, the marketplace can evolve further by moving into delivery of the products and services. By controlling the […]

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Marketplace Services

Marketplace Services In setting up a marketplace business, the more services you offer will lead to a better customer experience, leading to better retention. Consider adding these services to your marketplace platform: Manage the transaction from discovery to fulfillment of the service. Provide ratings of the buyers and sellers to foster transparency. Review the content […]

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Metrics for Marketplaces

Metrics for Marketplaces In running a marketplace business there are several metrics for measuring the performance of the market and platform. Here are some key metrics to consider: Gross Volume — this is the total amount of goods and services transacted on the platform. Activity — the number of times a buyer engages the platform […]

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Investor Connect: Matt Brugner of Stewardship Partners, LLC

On this episode of Investor Connect, Hall welcomes Matt Brugner, Founder of Stewardship Partners, LLC. Located in Dallas, Texas, USA, Stewardship Partners, LLC is a traditional search fund seeking to acquire one business and steward it into its next phase of growth. The fund is backed with capital from a handful of committed capital funds, […]

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Network Effects in Marketplace Businesses

Network Effects in Marketplace Businesses Marketplace businesses derive value from the network effects that come with matching buyers and sellers. The greater the number of buyers and sellers the more attractive the platform. One side of the marketplace can attract the other side. If one side is using the software platform, then the other side […]

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Expanding a Marketplace Business

Expanding a Marketplace Business After launching your marketplace business you’ll start work on expanding it. For the supply side, you want to increase the engagement with the suppliers.  Instead of being one source of many to your suppliers, you want to become their primary source. You can do so by setting up technical connections with […]

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Narrow Marketplaces

Narrow Marketplaces Marketplaces can be built vertically targeting one sector or horizontally targeting multiple sectors.  It’s best to start with a narrow marketplace focused on one vertical. The cost of starting it is much less than a broad one. By going narrow, you don’t have to generate a huge amount of supply.   You can start […]

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Fintech’s Role in Marketplace Businesses

Fintech’s Role in Marketplace Businesses Fintech can play an enabling role in a marketplace business. In addition to matching suppliers and buyers on a platform, fintech tools enable additional services that provide stickiness to the business. As the regulatory nature of fintech continues to constrain the growth of businesses, alternative financing becomes more prevalent.  Marketplace […]

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How To Launch B2B Marketplaces

How To Launch B2B Marketplaces In addition to B2C marketplaces, there are B2B marketplaces that are gaining rapid adoption. To launch a B2B marketplace consider the following tactics: Find participants who are not monetizing their value and help them capture it through a marketplace. Look for disruptions in the marketplace or economy as an opportunity […]

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Investor Connect: Jeffrey Kamys of Inherent Wealth Fund

On this episode of Investor Connect, Hall welcomes Jeffrey Kamys, CEO of Inherent Wealth Fund. Located in San Francisco, California, USA, Inherent Wealth Fund is a registered investment adviser focused on thematic and sector-specific investing. They implement innovative strategies and wealth management solutions for institutions. Inherent Wealth Fund fully understands how technological advances impact the […]

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Assessing a Marketplace

Assessing a Marketplace In setting up a marketplace business here are some key points to consider in choosing a potential marketplace.  The marketplace business model provides an advantage for the buyer, the seller, or both. The more often the buyers and sellers use the platform — daily, weekly monthly, or more —  the more valuable […]

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Launching a Marketplace Business

Launching a Marketplace Business In launching your marketplace consider starting with a niche. Focus on what your team does best. Choose a niche in the sector that you can easily gain access to the supply side. This could be either by geography or by service offering. Offer above-average service to launch the marketplace.  As Paul […]

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How To Start a Marketplace Business

How To Start a Marketplace Business In starting a marketplace business you must consider how to structure it and then how to build the supply and demand sides of it. For the structure, you can target a specific vertical by focusing on one segment or go horizontal and cover the entire space. To go horizontal […]

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What Is a Marketplace Business Model?

What Is a Marketplace Business Model? The marketplace business model is becoming increasingly popular among startups. A marketplace business connects buyers and sellers through a platform. The platform facilitates the transaction and does not produce or provide the product or service. The platform often handles the payment, facilitates the logistics, and more. Examples of companies […]

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Preparing for a Secondary Sale Transaction

Preparing for a Secondary Sale Transaction A secondary sale is important to the founders and employees of a company. It gives them the opportunity to sell their shares to gain liquidity in advance of the company’s exit. Here are some key issues to consider: Founders normally receive common shares when launching the company. There are […]

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Investor Connect: Nitin Rai of Elevate Capital

On this episode of Investor Connect, Hall welcomes Nitin Rai, Founder and Managing Partner at Elevate Capital.  Located in Hillsboro, OR, USA, Elevate Capital is a Diversity, Equity, and Inclusion focused fund that invests in US-based early-stage startups led by underrepresented entrepreneurs, including women, BIPOC, LGBTQ+, and veterans. Launched in 2016, it is one of […]

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What Companies Should Know Before Allowing Secondary Sales?

What Companies Should Know Before Allowing Secondary Sales? Companies who want to give their employees the opportunity to sell their shares should consider the following: Set specific timeframes to allow for stock sales by the employees. This limits the distraction of employees and reduces the amount of disclosure the company must do. Prepare disclosure statements […]

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Valuation Method for a Secondary Sale

Valuation Method for a Secondary Sale In pricing a secondary sale here are some valuation techniques: Estimate the value of the equity by multiplying the revenue by the multiple for similar companies. For example, SaaS companies are sold for a multiple of 10X revenues. Reduce the value of any debt the company has. Divide the […]

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Types of Buyers of Secondary Shares

Types of Buyers of Secondary Shares There are several types of buyers for secondary shares. Each has its own motivation for doing so. Here’s a list to consider: Employees often want more shares of a startup that is doing well. They may also want to sell their shares to pay for expenses such as college […]

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Tax Issues With Secondaries

Tax Issues With Secondaries There are tax issues associated with a secondary sale. Here’s a list of issues to consider: Gains on secondary sales are taxed based on the holding time of the shares. If less than one year, then ordinary income tax rates apply.  If longer than one year then the capital gains tax […]

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Pricing Secondary Shares

Pricing Secondary Shares In selling secondary shares a price must be set. Since the shares are in a private firm there’s no market to review for a list price. Here are some factors to consider in pricing a secondary sale: Are the shares preferred stock or common stock? Preferred stock has preferences such as liquidation […]

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Investor Connect: How to Invest Series

We are excited to announce a new segment for you, How to Invest Series. Where we will be revisiting some of the smart insights, tips, and advice from our past guests on the show. To start off the series we will be touching on the Biotech and life science subject. So, let’s dive right in […]

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Types of Secondary Transactions

Type of Secondary Transactions There are several types of secondary transactions as follows: Confidentially marketed public offerings — these offerings go to institutional investors. These transactions use an S3 form to provide shares to known buyers. Bought deal — these shares are bought by an underwriter who takes the risk of the transaction. Since the […]

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How Do Secondary Sales Work?

How Do Secondary Sales Work? Secondary sales typically occur with later-stage startups. Investors who want shares in a company will buy the shares from founders, employees, or other investors. The price is typically at a discount to the last priced round such as 15 to 30%. The seller must find a buyer for the stock. […]

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Customize the Pitch for the Investor

Customize the Pitch for the Investor Customize the pitch for each investor.  Research the investor before the pitch to learn more about their investment thesis. Review their portfolio of startups to see what is common about them and how your deal fits. For each investor choose three points to highlight that you think will connect […]

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Challenges in Secondary Sales

Challenges in Secondary Sales There are several obstacles to overcome in completing a secondary sale. Here are some challenges to consider: Board approval — In many cases, the company must approve any founder shares being sold.  Right of First Refusal — companies that have raised funding have Rights of First Refusal on any offers of […]

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Benefits of a Secondary Sale

Benefits of a Secondary Sale A secondary sale brings several benefits to the stakeholders in a startup. Companies stay private much longer than before.   Those in the company need access to capital.  For founders, a secondary sale provides some liquidity in the near term giving them the opportunity to continue growing their business for a […]

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Investor Connect: Zeke Trezise of New Stack Ventures

On this episode of Investor Connect, Hall welcomes Zeke Trezise, Associate investor of New Stack Ventures and a member of the Full Ratchet podcast team. Located in Chicago, IL, USA, New Stack Ventures is specialized in pre-seed and seed funding for startups led by entrepreneurs outside the traditional Silicon Valley mold. With a mission to […]

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Why Do Investors Want Secondaries

Why Do Investors Want Secondaries Secondaries stands for secondary sales which refers to selling privately held stock in startups to other buyers. Investors buy secondaries instead of waiting for the next fundraise round. By buying now rather than later the investor can lock in a lower valuation. Investors in secondaries provide liquidity to other investors […]

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Why Companies Delay IPOs

Why Companies Delay IPOs Companies stay private much longer than they used to. Previously companies ran an Initial Public Offering to gain access to the public markets for financing. Companies delay their IPOs for any of the following reasons: Avoid the cost of going public which is fairly high given the regulatory requirements. Maintain a […]

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What Are Secondaries

What Are Secondaries Secondaries stands for secondary sales which refers to selling privately held stock in startups to other buyers. This arises from several sources such as investors who want to get into the deal after the fundraise is complete or employees who want to sell some of their shares. Secondary sales are on the […]

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Preparing the Diligence Documents

Preparing the Diligence Documents Investors interested in your startup will want to perform due diligence on the deal. Diligence is a standard process investors go through to review all the relevant documents and checkmark all the boxes before investing. In preparing your diligence documents consider the following: Start with a checklist of potential items to […]

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Customize the Pitch for Your Investor

Customize the Pitch for Your Investor Hello, this is Hall T. Martin with the Startup Funding Espresso — your daily shot of startup funding and investing. In pitching investors, you’ll find that each investor is unique. Customize the pitch for the investor by emphasizing the elements of your deal that intrigue the investor. If the […]

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Preparing the Pitchdeck

Preparing the Pitchdeck In preparing your pitchdeck consider the following: Start with a template slide deck.  This ensures you cover all the key points. Each slide is one section of the executive summary.  Problem/Opportunity, Solution, Product, Team, etc. Write out on each slide what you want to say about that topic. Use the short bullet […]

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Investor Connect: Zamir Shukho of Vibranium VC

On this episode of Investor Connect, Hall welcomes Zamir Shukho, CEO and Founder at Vibranium VC. Located in San Francisco Bay Area, California, USA, Vibranium VC is a venture fund based in Silicon Valley and led by an international team of serial entrepreneurs. The investment focus is on seed-stage B2B SaaS startups.  Vibranium.VC aims to […]

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Identify the Target Investors

Identify the Target Investors Once you’ve identified the ideal investor type for your business you’ll need to build a target list of investors to pursue. Research potential investors for their criteria and how it matches your deal. Key areas to look for are industry sector, stage of investment, and geographic preference. Look at the portfolio […]

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Profiling the Ideal Investor

Profiling the Ideal Investor There are several types of accredited investors in the startup world.  These include angels, venture capitalists, and family offices. Angels write smaller checks compared to the other two but can provide support for your business as advisors and networkers to raise more capital. Venture capitalists write bigger checks and often take […]

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Valuation Methods To Consider

Valuation Methods To Consider In preparing your fundraise you need to consider your current valuation even if you’re using a SAFE or Convertible Note. There are several methods to use to estimate your valuation. The most often used method is comparables. This method looks at similar companies that recently raised funding and uses that as […]

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Preparing the Business Metrics

Preparing the Business Metrics Investors are looking for a high-growth company with good unit economics. In preparing for your fundraise you need to identify a handful of key metrics that show your growth story. For the seed stage, you must have a run rate that is above 10K revenue per month. For the growth stage, […]

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Investor Connect: Bentley Adams of Way

On this episode of Investor Connect, Hall welcomes Bentley Adams, CEO & Founder at Way. Located in Los Angeles, CA, Way is an intuitive eating app that helps people find peace in their relationships with food and their body. Their mission is to impact health and happiness, with a vision of the future where restrictive […]

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When To Raise Funding

When To Raise Funding Most founders go out for a fundraise prematurely because they need money, not because they are ready for fundraising. Consider the following to understand when to raise funding. Have a compelling idea that you can clearly articulate. Have a validated customer, market, and product lineup. Have the investor documents prepared.  While […]

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Milestone the Raise

Milestone the Raise Founders often want to compress their fundraising into one round for the sake of efficiency. While this may sound like a good idea, it’s actually an expensive one for the founder. Raising too much money in the early stages will cost the founder equity dilution. The valuation of the startup is low […]

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How Much Funding To Raise

How Much Funding To Raise When raising funding consider how much you should raise. Start with the overall amount of funding required to take the business to cash flow positive. This is often a fairly large number for platform-based businesses in a high-growth sector. Take the overall amount of funding and break it down into […]

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Fundraising Timeline

Fundraising Timeline For every $1M of funding you want to raise, it will take one year to raise it for early-stage startups. This includes time to prepare the company, the investor documents, and the pitch as well as contacting, pitching, and following up with investors.  It’s best to have your pitch deck and financial projections […]

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Fundraise Differences by Stage

Fundraise Differences by Stage In raising funding over the life of the startup you’ll find there are differences in the fundraise at each stage. The goal at the Seed stage is to show you can sell the product. At this stage, the investors will look primarily at the team since there’s little in the way […]

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Investor Connect: Liam Krut of Reinforced Ventures

On this episode of Investor Connect, Hall welcomes Liam Krut, Investment Partner, at Reinforced Ventures. Located in Pittsburgh, Pennsylvania, USA, Reinforced Ventures invest in overlooked areas of deep tech and have a network of over 1700 experts. The company was founded by technologists with a mission to serve and fund the next generation of commercial […]

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Von Restorff Effect

Von Restorff Effect The Von Restorff effect is defined by Wikipedia as an item that sticks out and is more likely to be remembered than other items. The startup pitch that provides something unique will be remembered more than the others. To use the Von Restorff effect in your pitch consider the following: Highlight key […]

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What Type of Funding Should You Seek

What Type of Funding Should You Seek When raising funding consider the type of funding you should pursue. There are many types of funding such as equity funding including angels and venture capitalists. There are debt funding tools including loans and revenue-based funding. There are crowdfunding portals including rewards, equity, and peer-to-peer lending. Before choosing […]

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Zeigarnik Effect

Zeigarnik Effect The Zeigarnik effect is defined by Wikipedia as uncompleted or interrupted tasks that are remembered better than completed ones. Investors will remember the pitch that leaves them hanging more easily than those with closure. The cliffhanger in a serialized show is remembered because the action is left unfinished. It leaves the viewer with […]

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Verbatim Effect

Verbatim Effect The Verbatim effect is defined by Wikipedia as the “gist” of what someone has said that is better remembered than the verbatim wording. Catchphrases and taglines will help investors remember your startup and what it does. Investors remember the essential meaning rather than the specific words you say in a pitch. They will […]

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Should You Raise Funding for Your Startup

Should You Raise Funding for Your Startup Before raising funding consider if you should raise funding for your startup. Ask why you need funding and see if you have a specific need for funding tied to growing the business.  If you have a business on a high growth trajectory, consider venture funding.  If the business […]

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Investor Connect: Rodney D’Souza of Horned Frog Investment Network at TCU

On this episode of Investor Connect, Hall welcomes Rodney D’Souza, Managing Director of  Horned Frog Investment Network, a program from the Institute for Entrepreneurship and Innovation at Texas Christian University (TCU). Located in Fort Worth, Texas, United States, Horned Frog Investment Network brings together an empowering community of accredited investors to support the next generation […]

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Testing Effect

Testing Effect The testing effect is defined by Wikipedia as the fact that you more easily remember information you have read by rewriting it instead of rereading it. Investors remember what they recall from memory better than just hearing the pitch again. This comes from research showing that taking a test that requires one to […]

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Spacing Effect

Spacing Effect The spacing effect is defined by Wikipedia as information is better recalled if exposure to it is repeated over a long span of time rather than a short one. A series of updates is more effective in communicating your startup story as the investor will remember more than if the story were given […]

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Humor Effect

Humor Effect The humor effect is defined by Wikipedia as humorous items that are more easily remembered than non-humorous ones, which might be explained by the distinctiveness of humor, the increased cognitive processing time to understand the humor or the emotional arousal caused by the humor. Startup pitches with humor are more memorable than those […]

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Context Effect

Context Effect Context effect is defined by Wikipedia as cognition and memory are dependent on context, such that out-of-context memories are more difficult to retrieve than in-context memories Investors need context in order to understand the startup offering such as the problem to be solved. In pitching founders include basic concepts in the presentation. The […]

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Bizarreness Effect

Bizarreness Effect The bizarreness effect is defined by Wikipedia as bizarre material that is better remembered than common material. Presentations that use bizarre information are more easily remembered than conventional ones. Founders can capture and maintain the interest of investors by using unusual wording or language. This works when the unusual phrase or sentence is […]

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Investor Connect: Adam Besvinick of Looking Glass Capital

On this episode of Investor Connect, Hall welcomes Adam Besvinick, Founder and Managing Partner at Looking Glass Capital. Located in Purchase, NY, USA, Looking Glass Capital is a pre-seed and seed fund that seeks to invest in and support mission-driven founders during the earliest days of company building. They are most inspired by entrepreneurs solving […]

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False Consensus Effect

False Consensus Effect The false consensus effect is defined by Wikipedia as the tendency for people to overestimate the degree to which other people agree with them. Founders sometimes overestimate how others may share their beliefs. They often mistake silence for consent in talking with investors. Investors often nod in acknowledgment of what the founder […]

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Naive Realism

Naive Realism Naive realism is defined by Wikipedia as the belief that we see reality as it really is – objectively and without bias; that the facts are plain for all to see; that rational person will agree with us; and that those who don’t are either uninformed, lazy, irrational, or biased. Founders believe their […]

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Illusory Superiority

Illusory Superiority Illusory superiority is defined by Wikipedia as overestimating one’s desirable qualities and underestimating undesirable qualities, relative to other people. Every founder considers themselves superior and should be funded accordingly. This is a flawed view of the startup world in which investors can see many startups while the founder sees far fewer. In fundraising, […]

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Illusion of External Agency

Illusion of External Agency Illusion of external agency is defined by Wikipedia as when people view self-generated preferences as instead being caused by insightful, effective, and benevolent agents. Founders often believe someone else can make their fundraiser successful. The responsibility of fundraising for startups lies solely on the founder’s shoulders. While others may help through […]

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Group Attribution Error

Group Attribution Error Group attribution error is defined by Wikipedia as the biased belief that the characteristics of an individual group member are reflective of the group as a whole. Startups often project the characteristics of one investor on the entire group when the group is much more diverse. Angel groups for example are composed […]

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Investor Connect: Jonathan Stidd of DealMaker

On this episode of Investor Connect, Hall welcomes Jonathan Stidd, President at DealMaker Reach. Located in Toronto, ON, Canada, DealMaker is on a mission to create the most sophisticated capital markets tools on the planet, empowering capital to flow faster. It offers a suite of primary issuance, shareholder management, and capital raising solutions that includes […]

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Zero-Risk Bias

Zero-Risk Bias Zero-risk bias is defined by Wikipedia as the preference for reducing a small risk to zero over a greater reduction in a larger risk. Customers will choose a product that eliminates risk over another product that has a greater price reduction. For example, you could offer two products that are similar. The first […]

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Survivorship Bias

Survivorship Bias Survivorship bias is defined by Wikipedia as concentrating on the people or things that “survived” some process and inadvertently overlooking those that didn’t because of their lack of visibility. Incubators often measure their results based on startups that get funded rather than all the ones who go through the program. Taking out the […]

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Subjective Validation

Subjective Validation Subjective validation is defined by Wikipedia as the perception that something is true if a subject’s belief demands it to be true.  In developing products founders look for information that matches their own view of the problem and solution. Founders build their products for a market based on their own view of the […]

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Pseudo-certainty Effect

Pseudo-certainty Effect The pseudocertainty effect is defined by Wikipedia as the tendency to make risk-averse choices if the expected outcome is positive, but make risk-seeking choices to avoid negative outcomes. As the startup finds success, the founder becomes more risk-averse because something at stake can be lost. For startups that are flailing, risk-taking becomes the […]

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Authority Bias

Authority Bias Authority bias is defined by Wikipedia as the tendency to attribute greater accuracy to the opinion of an authority figure and be more influenced by that opinion. Founders seek experts in various roles to help grow their startups. In particular, this occurs when the founder is working in unfamiliar areas. Problems arise if […]

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Investor Connect: Ethan Rigel of Gore Range Capital

On this episode of Investor Connect, Hall welcomes Ethan Rigel, Founder, and Managing Partner at Gore Range Capital. Located in New York City, New York, USA, Gore Range Capital is focused on investments in early-stage skin health businesses. Their approach is simple: they invest in what they know. Over the course of their respective careers, […]

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Optimism Bias

Optimism Bias The optimism bias is defined by Wikipedia as the tendency to be over-optimistic, overestimating favorable and pleasing outcomes  Startup founders often focus solely on the opportunity while ignoring the risks. Skeptical investors do the opposite by focusing on the risks. Startups succumb to the optimism bias because they believe more things are under […]

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Ostrich Effect

Ostrich Effect The ostrich effect is defined by Wikipedia as ignoring an obvious negative situation. It’s common among founders to ignore the challenging parts of the startup such as competitive position or weakness of the product, and more. Some founders handle it by not paying attention to it. Others misinterpret the situation as something else […]

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Planning Fallacy

Planning Fallacy The planning fallacy is defined by Wikipedia as the tendency to underestimate task completion times. Projects take twice as much time and cost as planned. First-time founders don’t have previous experience and cannot rely upon past projects when making plans. Some founders recall selected cases in the past that went well and plan […]

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Pro-Innovation Bias

Pro-Innovation Bias The pro-innovation bias is defined by Wikipedia as the tendency to have an excessive optimism towards an invention or innovation’s usefulness throughout society, while often failing to identify its limitations and weaknesses. Startups overestimate the speed of adoption of new technology. Users are often slow to adopt new technologies due to the cost […]

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Projection Bias

Projection Bias The projection bias is defined by Wikipedia as the tendency to overestimate how much our future selves share one’s current preferences, thoughts, and values, thus leading to suboptimal choices Founders who hire team members in the early stage come to realize that different skills will be required later in the life of the […]

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Investor Connect: Sarah Jennings of Beyond Capital Funds

On this episode of Investor Connect, Hall welcomes Sarah Jennings, Director of Beyond Angels, and Co-Founder at Beyond Capital Funds. Located in Dallas/Fort Worth Metroplex, Texas, The Beyond Capital Funds invests alongside established VCs targeting Late-Seed to Series A investment opportunities in disruptive innovation such as Artificial Intelligence, Next Generation Internet, Software as a Service, […]

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Omission Bias

Omission Bias The omission bias is defined by Wikipedia as the tendency to judge harmful actions (commissions) as worse, or less moral, than equally harmful inactions (omissions). Founders will often omit details rather than give outright lies when pitching their startup to an investor. Ultimately, in due diligence, all the facts will become known. It’s […]

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Observer Expectancy Bias

Observer Expectancy Bias The observer expectancy bias is defined by Wikipedia as when a researcher expects a given result and therefore unconsciously manipulates an experiment or misinterprets data in order to find it. Startups will take customer feedback and ignore the elements that don’t match their expectations. This is a problem that many startups face […]

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Normalcy Bias

Normalcy Bias The normalcy bias is defined by Wikipedia as the refusal to plan for, or react to, a disaster that has never happened before. First-time startups suffer from the normalcy bias as they have limited experience with what can happen to startups over time. Founders with previous experience tend to prepare better for the […]

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Money Illusion

Money Illusion The money illusion effect is defined by Wikipedia as the tendency to concentrate on the face value of money rather than its value in terms of purchasing power. In pricing the product, a startup should list their product price in the smallest unit possible such as daily cost rather than annual cost. For […]

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Illusory Truth Effect

Illusory Truth Effect The illusory truth effect is defined by Wikipedia as the tendency to believe that a statement is true if it is easier to process, or if it has been stated multiple times, regardless of its actual veracity.  In a startup pitch, facts repeated several times can increase believability. Repetition reinforces a belief […]

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Singularity Effect

Singularity Effect The singularity effect is defined by Wikipedia as the tendency to behave more compassionately to a single identifiable individual than to any group of nameless ones. People in general feel compelled to help individuals.  In a disaster scenario such as an earthquake, donors will feel numb to the large number of people impacted […]

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Investor Connect: David Hurwitt of Troove

On this episode of Investor Connect, Hall welcomes David Hurwitt, CEO & Founder at Troove. Located in Burlington, Vermont, USA, Troove is the first technology to harness the power of alumni and current student experience to help potential students make the biggest decision of their life.   Troove use predictive AI to gather, mine, and decode […]

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Reactive Devaluation

Reactive Devaluation   Reactive devaluation is defined by Wikipedia as devaluing proposals only because they purportedly originated with an adversary. Founders skip the lessons that can be learned from competitors because they view the competitor as wrong in their approach. This also applies to situations in which the founder discounts advice given from a source that […]

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Product Segmentation

Product Segmentation Product segmentation creates different versions of the product for different users. Novice users may get a version that is simple to use while power users have access to tools that are more complex. One can achieve product segmentation by using a platform approach to the product. A platform approach provides a basic architecture […]

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Illusion of Control

Illusion of Control The illusion of control phenomenon is defined by Wikipedia as the tendency to overestimate one’s degree of influence over other external events. Startups often display an illusion of control about how their product and sales efforts will take over a market. Just as the gambler in the casino cannot make the dice […]

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Hindsight Bias

Hindsight Bias The hindsight bias is defined by Wikipedia as the tendency to see past events as being predictable at the time those events happened. When an investor sees a  startup fail or succeed, early indicators come back to the investor’s mind. In some cases, investors selectively remember certain events or facts that later confirm […]

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Investor Connect: Pedro Sorrentino of Atman Capital

On this episode of Investor Connect, Hall welcomes Pedro Sorrentino, Founder & Managing Partner at Atman Capital. Located in San Francisco, Miami, and NYC, Atman Capital is an early-stage startup, investing in technology and technology-enabled startups in the US and Latam. They invest in the following themes: B2B software, Commerce, Consumer, and Fintech. At Atman, […]

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Benefits of a Platform-Based Approach

Benefits of a Platform-Based Approach A platform-based approach to your business brings many benefits  Platforms make it easier to use a recurring revenue model.  Investors appreciate the value of this revenue model. It brings predictability to the forecast and makes it somewhat easier to manage the business and raise funding. With three metrics, cost of […]

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Applying AI to E-commerce

Applying AI to E-commerce AI brings new capabilities and benefits to e-commerce businesses. AI can enhance e-commerce companies in the following ways: Create better search tools for customers seeking products and services online. Retarget customers for related products. Provide better recommendations to customers for similar products. Enhance the customer shopping experience through voice or chat […]

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Applying AI to Current Products

Applying AI to Current Product AI can be applied to your current products. Here are some benefits of integrating AI with your product line: Add new capabilities to the existing product. This could be a better analysis of the information coming out of the product. Reduce costs. AI capabilities could replace more expensive search algorithms. […]

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