phil_Hill

Why Start-Ups Fail To Raise Money in Atlanta

philhill — Thu, 08 Aug 2013 16:09:29 +0000

Here’s one reason why startups fail in Atlanta. Dropbox would not have been funded out of Atlanta:

“Raising money is not like applying to college, where you can assume that if you can get into MIT, you can also get into Foobar State. Because the best investors are much smarter than the rest, and the best startup ideas look initially like bad ideas, it’s not uncommon for a startup to be rejected by all the VCs except the best ones. That’s what happened to Dropbox. Y Combinator started in Boston, and for the first 3 years we ran alternating batches in Boston and Silicon Valley. Because Boston investors were so few and so timid, we used to ship Boston batches out for a second Demo Day in Silicon Valley. Dropbox was part of a Boston batch, which means all those Boston investors got the first look at Dropbox, and none of them closed the deal. Yet another backup and syncing thing, they all thought. A couple weeks later, Dropbox raised a series A round from Sequoia”. – Paul Graham.

This is an excerpt for a great essay by Paul Graham called “How to Convince Investors“.

3 startup metrics to know if you want a $100 million business

philhill — Wed, 19 Sep 2012 17:18:29 +0000

What’s important when building a start-up?

3 most important metrics in the value chain for startups:

Rate of acquisition
Rate of retention
Rate of monetization

A break in the chain of anyone of these will screw-up the business. e.g. it’s no good acquiring and monetization loads of users unless you can retain them; if you’re a low priced consumer app, it’s no good monetization and retaining 100% of your users if you are not acquiring enough in the first place.

Rewriting the three metrics in lay terms, a bad business would be:

No one knows about you
The leaky bucket
Free-loaders rule

This article digs deeper and hits the nail on the head…

With tens of thousands of new start-ups being created every year, the potential of a company to truly scale and become a large, stand-alone business is more crucial than ever before.

A great product is always the foundation but a clear distribution strategy becomes essential to cut through the noise.

So most early-stage VCs have started to evaluate investment opportunities with an imaginary benchmark in mind: can this company become a $100 million opportunity?

Generally speaking, there are two ways and only two ways to scale a business to hit that $100 million threshold:Your business has a high Life Time Value LTV per user, giving you the freedom to spend a significant amount of money in customer acquisition.

High LTV can usually be found in transactional or subscription businesses.Your business has a high viral co-efficient or perhaps even a network effect that lets you amass users cheaply without worrying too much about the monetization per user or spending money on paid acquisition.

Continue reading: The only 2 ways to build a $100 million business » Version One Ventures.

Startup Economics – SmartAsset.com

philhill — Wed, 19 Sep 2012 12:52:23 +0000

This is a useful website. I assumed the following and the site worked out how much stock / value everyone cashes out with with a sale of $20,000,000:

Starting and funding a company is complicated business. This interactive infographic, by SmartAsset.com, helps you understand how different funding events will affect you and your investors over time, and at exit. You can also specify different co-founder share allocations and add Employee or Advisor shares.

Try It out for free Startup Economics – SmartAsset.com.

Growth Hacker is the new VP Marketing

philhill — Tue, 04 Sep 2012 21:01:38 +0000

It’s always good when new terms rise up to describe old things. Here’s the latest….(curated article) – Phil

The rise of the Growth HackerThe new job title of “Growth Hacker” is integrating itself into Silicon Valley’s culture, emphasizing that coding and technical chops are now an essential part of being a great marketer. Growth hackers are a hybrid of marketer and coder, one who looks at the traditional question of “How do I get customers for my product?” and answers with A/B tests, landing pages, viral factor, email deliverability, and Open Graph.

On top of this, they layer the discipline of direct marketing, with its emphasis on quantitative measurement, scenario modeling via spreadsheets, and a lot of database queries. If a startup is pre-product/market fit, growth hackers can make sure virality is embedded at the core of a product.

After product/market fit, they can help run up the score on what’s already working.This isn’t just a single role – the entire marketing team is being disrupted. Rather than a VP of Marketing with a bunch of non-technical marketers reporting to them, instead growth hackers are engineers leading teams of engineers.

Continue Reading Growth Hacker is the new VP Marketing | @andrewchen.

The Cooper Journal: The best interface is no interface

philhill — Thu, 30 Aug 2012 15:06:43 +0000

Curated article: A great take on user interfaces and how less is more..

The best interface is no interface

Then, in 1984, Apple adopted Xerox PARC’s WIMP — window, icon, menu, pointer — and took us a galactic leap forward away from those horrifying command lines of DOS, and into a world of graphical user interfaces.

Read Full Article: The Cooper Journal: The best interface is no interface.

Re: Defining the Series A

philhill — Tue, 28 Aug 2012 16:17:04 +0000

It’s interesting to see how the funding process is changing (especially by the new start-up accelerators). This is a pertinent sentence to this article:

“The new pattern looks more like this: launch from an incubator / accelerator (~$50k), get a boost from a micro-VC round ($300k-$500k), and then take a $1m-$2m “Bullpen” type round to hit your key proof-points.”

- phil

The newest Cooley Venture Financing Report indicates that median Series A pre-money valuations were at an 8-year high in Q2 2012, leaving some seasoned venture capitalists scratching their heads.

Michael Greely, a partner at Flybridge, put it succinctly in a recent post when he said “Series A round sizes have been coming down over the last few years as companies can get by with raising less capital … I expected valuations for Series A to be a fraction of the $11 million witnessed.”Michael also did some back-of-the-envelope analysis using the common benchmark that “companies are raising ~$5 million in typical Series A rounds.”

This $5m benchmark makes sense for VCs that invest in capital-intensive sectors like biotech. It also makes sense for the bigger VC funds, as data from the NVCA indicates that almost 80% of the $5.9B invested in VC funds in Q2 2012 went to the top five firms. That is an astounding concentration, and the nose-bleed VCs simply can’t write checks less than $5m-$6m and hope to deploy this capital effectively.

via Re: Defining the Series A «.

Emedly test

philhill — Tue, 14 Aug 2012 11:34:14 +0000

7 Ways to Prospect for New Customers With LinkedIn | Social Media Examiner ow.ly/cQY66

— Phil Hill (@philhill) August 9, 2012

When you take your friend's phone and they try to get it from you:

http://blog.flashissue.com/5-must-read-articles-on-content-curation-tools/

Content Curation Tips & Curation Tools

philhill — Tue, 14 Aug 2012 11:16:32 +0000

Content Curation Tips for Stellar Social MediaWhat is content curation? It is the act of finding content to share throughout social media platforms. Finding relevant, interesting, and informative content to post is important for anyone in social media. There is an art and science to finding the best content and it is well worth your time to be thoughtful and careful in what you share. Give people a reason to follow you and keep following you! Per Beth Kantor , \"Content curation is not about collecting links or being an information pack rat, it is more about putting them into a context with organization, annotation, and presentation. Content curators provide a customized, vetted selection of the best and most relevant resources on a very specific topic or theme.\" The first step is defining what your topic or focus will be for your content. What do you want to be known for? What is your business focus? Pick several keywords for your content and be consistent. These words should also be used throughout your social media profiles so that people will find you when they search for keywords that interest them. This doesn\'t mean that you have to share only social media (if that was your keyword) but a good percentage so it is clearly your focus.

via Pegfitzpatrick

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Content Curation Tips for Stellar Social MediaWhat is content curation? It is the act of finding content to share throughout social media platforms. Finding relevant, interesting, and informative content to post is important for anyone in social media. There is an art and science to finding the best content and it is well worth your time to be thoughtful and careful in what you share. Give people a reason to follow you and keep following you! Per Beth Kantor , “Content curation is not about collecting links or being an information pack rat, it is more about putting them into a context with organization, annotation, and presentation. Content curators provide a customized, vetted selection of the best and most relevant resources on a very specific topic or theme.” The first step is defining what your topic or focus will be for your content. What do you want to be known for? What is your business focus? Pick several keywords for your content and be consistent. These words should also be used throughout your social media profiles so that people will find you when they search for keywords that interest them. This doesn’t mean that you have to share only social media (if that was your keyword) but a good percentage so it is clearly your focus. (Continue Reading …)

via Pegfitzpatrick

Your Best Options for Sharing Content Through Email

philhill — Tue, 17 Jul 2012 18:04:58 +0000

Creating quality content is now a prerequisite for social media marketing efforts. Let’s have a look at how email marketing is keeping up with this changing landscape.

New guys on the block:

More and more marketers are using email to deliver content. You’ve probably started seeing these digest-style emails from your favorite sites recapping their top content.Here is a pair of examples click picture to expand:

via Your Best Options for Sharing Content Through Email | Content Marketing Institute.

Create A Newsletter Now (for Free) – Go to FlashIssue

The Design Dilema for Lean Startups

philhill — Wed, 20 Jun 2012 15:22:47 +0000

How much should i design? How much should i measure / analyse? Good questions…this article delves into the former and my post the latter. The gist of this article is that a Minimum Viable Product (MVP) , can be broken into 2; Minimum Viable Features and Minimum Viable design. You need to do as much as is necessary to validate your assumptions – phil

One of the top questions I get when helping entrepreneurs, especially those who have not achieved product/market fit, is “How much should I invest into the design of my… landing page, MVP, smoke-test, pitch deck,… etc.” The commonly cited answer is that “it depends.” But it depends on WHAT?

The dilemma

Calculating the right level of form in relation to function is one of the longest running debates across all the disciplines of design. In simple terms, it’s deciding the balance between the utility a product provides (function) and the beauty of it (form). As the classic example below taken from the Universal Principles of Design book shows, focusing heavily on one area greatly impacts the end result.

via The Design Dilema for Lean Startups.