How To Tell When the Startup Doesn’t Have Anything

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Startups raising funding should bring customer engagement, if not traction, to the pitch.

Founders raising funding often compensate for the lack of customer engagement through distractions.

Here’s how to tell when the startup doesn’t have anything:

Revenue is only listed as a forecast with pipeline sales.

Key metrics are based on forecast sales, not actual sales.

There are no actual customers in discussion, and no names of any partners.

The focus is on technology and how it works.

The product is a high-level vision of what will be, but nothing is under development.

The team has a handful of potentials but no actual results from their work.

The pitch is primarily how big the market is and the size of the opportunity.

The discussion focuses on how the competition is failing but never mentions how the startup is succeeding.

The deck shows huge returns to the investor, but there are no actual revenue figures listed.

In short, it’s all vision and no execution.

Look for these signs that the startup doesn’t have anything before pursuing investment.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_________________________________________________________

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In this episode of Investor Connect, Hall Martin engages with Joe Perino, a seasoned industrial strategist, consultant, and engineer with over four decades of experience. Joe shares insights on industrial transformation, emphasizing the importance of technology-enabled business model changes that yield significant improvements. He discusses the impact of predictive analytics and edge computing in the energy process and manufacturing sectors, highlighting their role in predictive maintenance and operational efficiency.

Joe also touches on the challenges of scaling AI applications, the necessity of robust cybersecurity measures, and the importance of interoperability standards in industrial tech. Additionally, Joe shares his experience with mentoring startups and the role of industry consortia and accelerators in fostering innovation and business growth. This episode provides a comprehensive overview of the industrial tech landscape, offering valuable advice for both operators and investors.

Reach out to at www.linkedin.com/in/joe-perino-952792/ or pertex@comcast.net

_________________________________________________________For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
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LP Investing Mistakes

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Limited partners are referred to as LPs.

They invest in venture capital funds.

Just as angel investors make mistakes, so do LPs

Here’s a list of LP investing mistakes:

Not investing consistently.

It’s easy to invest when the market is up and difficult to do so when the market is down.

One of the best times to invest is after the market has dropped.

Investing based on track record alone.

While it’s a good reference point, the returns of a manager can be manipulated.

Treating a venture as an index fund.

While an index fund model can be applied to venture capital, it yields limited returns.

Focusing solely on fees.

The LP receives the return minus the fees.

In some cases, the return may justify the fees.

Ignoring portfolio structure.

LPs should build a diversified portfolio of funds and startups and avoid over-concentration in a sector.

Direct startup investment.

While there may be opportunities that come along, it’s very rare that solo investments will prove out.

Avoid these mistakes in your VC investments.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_________________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
For Startups check out: https://tencapital.group/company-landing/
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For upcoming Events, check out https://tencapital.group/events/

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Tips for the Startup Financial Pro Forma

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Part of the fundraising documentation is the financial pro forma.

Investors want to know what the founder proposes will happen if they raise the target fundraising amount.

The financial pro forma shows this projection.

Here are some tips on building your startup financial pro forma.

The pro forma should be a bottom-up analysis, not a top-down.

This means each revenue and expense comes from history.

Use historical dates such as 2024, 2025, rather than year 1, year 2, etc.

This helps the investor understand what will happen and when.

For hires, include the full overhead that comes with each one.

For revenue, start with a realistic amount and then apply a growth rate to it.

This will give a steady ramp to the revenue and can be changed easily when the assumptions change.

Model the sales funnel in the pro forma by showing the cost to generate the lead, qualify it, set up a pilot, and close the sale.

Include churn as a part of the financial pro forma.

Build the pro forma with each month listed, but be able to roll it up into quarters for use in the pitch deck.

The investor understands the entire forecast is based on receiving funding, and that is a moving target.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_________________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
For Startups check out: https://tencapital.group/company-landing/
For eGuides check out: https://tencapital.group/education/
For upcoming Events, check out https://tencapital.group/events/

For Feedback please contact info@tencapital.group

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Mistakes VCs Make

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Venture capitalists make mistakes just like every other investor.

Here’s a list of mistakes VCs make:

Not investing consistently through the market's ups and downs.

Valuations are better in down markets, and good deals are hard to find in up markets.

Treating venture capital funding as a one-size-fits-all.

There are some sectors of the market that do well with VC funding, while other sectors only waste it.

Quoting returns without taking into account the management and carry fees.

Fees are a cost of investing and should be counted in the return metrics.

Not taking into account the overall portfolio structure.

Time to exit, sector position, and other factors can help build a solid portfolio.

Investing in overvalued startups.

During frothy markets, one can get carried away by stellar startups even though they have outsized valuations.

Not scanning the overall industry for the best deal.

Some VCs choose startups because they are accessible, but this may fail to find the best startup in the industry.

Funding too many deals in a specific application.

Diversification is still a key factor in successful startup funding.

Consider these mistakes VCs make.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_________________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
For Startups check out: https://tencapital.group/company-landing/
For eGuides check out: https://tencapital.group/education/
For upcoming Events, check out https://tencapital.group/events/

For Feedback please contact info@tencapital.group

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The Dark Side of Venture Capital

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

While venture capital brings many benefits to the startup ecosystem, it also has drawbacks.

Here’s a list to consider:

The venture model generates a high number of startup failures.

By pushing the business to the extreme, many fail.

The standard for venture-backed businesses is very high.

The cost of venture funding is expensive, so losses to the investor are also high.

The pressure to succeed at all costs drives some founders into mental and physical health problems.

Venture capital is still a long way from being an inclusive and diverse group.

Women and minorities are still woefully underrepresented.

The pressure to find and join successful startups can drive investors to overvalue startups.

The emergence of new technologies can turn into market bubbles driven by irrational exuberance.

Venture capital brings many benefits to the startup ecosystem, including capital, innovation, and expertise.

It’s important to keep these challenges in mind.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_________________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
For Startups check out: https://tencapital.group/company-landing/
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The Introductory Version of the Pitch Deck

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

For the first pitch to an investor, build an introductory pitch deck.

The introductory version of the pitch deck simplifies your deal into its most basic presentation.

The pitch deck should focus on one problem, one solution, and one application.

It should have one product, one channel, and one monetization model.

It should have one fundraise, one outcome, and one exit.

The introductory version avoids the many things your business can do.

Investors have a difficult time managing multiple scenarios and outcomes.

Your pitch deck should not go into the many markets and applications it can cover.

Instead, keep it simple and focus on the core elements of the deal.

There will be time later to discuss the options.

Keep it to one thing on each element of the pitch deck.

The goal of the introduction is to convince the investor that this is a fundable deal worth digging into.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
For Startups check out: https://tencapital.group/company-landing/
For eGuides check out: https://tencapital.group/education/
For upcoming Events, check out https://tencapital.group/events/

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In this episode of Investor Connect, host Hall Martin sits down with Earle Hager, Managing Partner of The Neutrino Donut, a consulting firm specialized in transforming scientific research into commercial solutions. Earle shares his extensive experience in technology evaluation, market planning, and commercialization strategies, highlighting his work with startups, universities, and government-funded projects supported by SBIR/STTR programs.

He discusses his journey from business development roles in Texas to founding Neutrino Donut and working on global projects at the University of Texas at Austin and UC Irvine's tech transfer office. Earl reveals the challenges and successes in helping science-based startups bring their innovations to market, focusing particularly on medical devices. He shares insights on balancing technical rigor with practical market demands, the importance of SBIR funding, and his extensive network of industry contacts.

Earle also explains the meaningful name behind his consulting firm, 'Neutrino Donut,' and emphasizes his commitment to fostering innovation across regions like Austin, Los Angeles, and beyond. To wrap up, Earl outlines the importance of building relationships and continually learning in this dynamic field. For more details, visit Neutrino Donut's website or contact Earl directly on LinkedIn.

Visit The Neutrino Donut at neutrinodonut.com/

Reach out to at ehager@neutrinodonut.com

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
For Startups check out: https://tencapital.group/company-landing/
For eGuides check out: https:/_/tencapital.group/education/
For upcoming Events, check out https://tencapital.group/events/

For Feedback please contact info@tencapital.group

Please follow, share, and leave a review.

Music courtesy of Bensound.