Mission

  • For many entrepreneurs, the venture world is needlessly opaque and confusing. Venture capital is both art and science with karma mixed in. With a synchronistic twist, this blog will try to shed light on the world "behind the curtain" as well as how key entrepreneurial lessons are mirrored in everyday life.

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Comments

Some good advice - however one of the problems everyone is now encountering is the cost of new hires. Try hiring a VP on $100K a year and some options. It won't fly. Everything is getting more expensive.

And your point about "if the deal is successful"... is true, but only a few ever make it (just look at your own IRR's over the last 5 - 7 years).

Cash is King and always will be, the key is to manage expectations appropriately, and hire the very best even if it costs you more - remember the old adage, "if you think knowledge is expensive, see how much ignorance costs you".

True. As we get deeper into this cycle, compensation is rising on the cash side and a company has to pay what the market will bear. My comments are targeted more at the founders themselves. You are spot on that new employees won't come on unless salaries are competitive. However, I counsel founders to not raise money to pay themselves early on because it is expensive cash.

Matt:

Danny DeVito had it right! I wish someone could have taught me the value of OPM a long time ago. Why use your own money to make money, when you can use other people's? Empires have been created and destroyed based on this very clever idea.

I cross-posted on your piece to http://blog.innovators-network.org The Innovators Network is a non-profit dedicated to bringing technology to startups, small businesses, non-profits, venture capitalists and intellectual property experts. Please visit us and help grow our community!

Best wishes for continued success,

Anthony Kuhn
Innovators Network

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