初创公司资金需求计算器。。。。

In my last post, The Product, Part II: Technical architecture and the innovator’s paradox I talked about the importance of staying in the game and linked to a Wikipedia article on the Kelly criterion.  In the comments, entrepreneur and physicist Max Skibinsky took the idea literally and used the Kelly criterion to calculate the optimal burn of a startup.  I was so impressed with Max’s comment that I imported his Google spreadsheet into Excel and played around with it:  here is an editable copy of [my updated version] Max’s spreadsheet.

Max’s math:

p = probability of success
b = payout odds per kelly
F = funding
V = valuation
M = valuation multiplier on “win”
R = burn rate per time frame
T = time frame units to develop and prove

What we can learn about optimal burn from the Kelly criterion.

You obviously shouldn’t take this too literally.  But I do find that it is a very interesting reality check.  

Assumptions in the spreadsheet:

+ Capital raised to $2MM on a $6MM post money valuation.  

+ 15% chance of any experiment returning a 10x increase in valuation.

+ 9 months to build and test each experiment in the market.

+ $100,000 per head (includes salary, benefits, rent, computers, marketing).

Using Max’s spreadsheet which is based on the Kelly criterion’s probability of maximizing long-term returns, the optimal monthly burn is $32K, which would cover 4 heads.  This would give you capital for 7 experiments.

A few brief thoughts:

For any hit driven (or wildly innovative) business, you should assume that [at least] your first experiment will fail.  This will remove pressure and allow for maximum flexibility.  It also drives how you should build your product and manage your finances.  It also drives the following recommendations:

1.  Keep burn very low until you have proof of traction. 

Everyone knows this intuitively, but the vast majority of startups spend an order of magnitude greater than their target Kelly burn.  You can reduce burn by hiring fewer people, keeping salaries low, working long hours, and hiring very productive people.  Most people focus on keeping salaries low bit, but my experience is that hiring a few exceptional people at higher salaries is cheaper than hiring more [less productive] people at lower salaries.

2.  Raise more money than you need.

Easier said than done — but if you have the opportunity to raise a bunch of capital, you should seriously consider doing so.  Figure out the optimal number of people needed to run an experiment and use the Kelly burn spreadsheet to impute required capital.  The cost of giving up more equity early on is often more than offset by the increased flexibility to take chances.  There is obviously some equilibrium point in there between loss of present value as a result of taking too much equity capital (for the entrepreneur) versus loss of present value as a result of taking too little capital and putting too much capital into a single bet or few bets.  Many entrepreneurs can’t raise more capital, but those who can should.  

3.  Increase the probability of success on each experiment.

This is clearly the highest leverage point in the model.  You can increase your odds of success by (a) picking a big existing market (rather than trying to invent a market, reinvent an existing one); (b) recruiting a killer team; and (c) picking great investors.

You can also increase your odds of success by building and shipping product quickly, by instrumenting your site / product so that you can run tests and make data-driven decisions, and by killing failed experiments quickly.   

For an entertaining history on mathematics, information theory, economics, gambling, and the mob check out Fortune’s Formula.

VCs often ask entrepreneurs to tell them a little bit about their background. 

When a VC asks this question they are looking for a high-level 30 second summary of your background.  Start with your name and title in the company and then rattle off the companies, titles and one-liners for all of the steps in your career.  “I was a VP at Pepsi, where I led the South American branding initiative,” would be a good example of concise coverage for a segment of your experience.  If VCs are intrigued about a specific topic or feel compelled to dive in, they will.  As a result, you don’t need to volunteer lots of extra color.

VC asks entrepreneur’s about their backgrounds in order to get a high-level sense of the likely skill-set of each team member to confirm that the group complements each other and is well aligned with their respective roles.  While this will also inform their sense of your competency, the interaction throughout the meeting will likely have more bearing.

Be sure that each member of your team is prepared to give their personal pitch before you arrive - this is an easy part of the meeting to nail.

　　如何选择项目？我认为，第一是评估市场，市场有很大的拓展空间；第二，选择产品，哪一种产品合适，有没有独特性，什么时间推出；还有最重要一点是选择领导者，投资团队。

　　风险投资是一个‘看人’的工作，找的是未来的成功者。怎么找呢？要深入调查，沟通，看他做过什么，靠谱不靠谱，有点像姑娘找老公。

　　打动我的人，首先要有激情有梦想；其次逻辑思维得强，实干，不能像个诗人，整天天花乱坠的；第三必须有很强的号召力和凝聚力，有领袖气质，包容性强；第四学习能力强，能把握新的机会。还有，身体一定得要好，企业领导人必须得比别人多付出更多时间和精力。

　　说白了我要找的是宋江式的人物。

　　宋江其实没什么本事，文不能安邦，武不能定国。可是每个英雄好汉见了他都说：我们在江湖上早就听说了您‘及时雨’宋公明的大名。所以李逵啊孙二娘啊吴用啊什么人都愿意听他的。

　　这帮人有共同的宗旨目标，就是替天行道，杀富济贫，好比企业要有共同的目标；梁山好汉短期的分配方式是‘大碗喝酒’、‘大块吃肉’、‘大秤分银’，后来给每个人排了座次，估计分配方式不一样了，这就好像用期权的方式给大家解决了激励机制的问题；他们讲究的是‘风高放火、月黑杀人’，这就好比创业强调时机选择，等风过去了放了火也很难烧起来，月亮出来了杀了人就跑不掉，做企业也一样，该出手的时候要出手，要抓住机会；最后宋江们被朝廷招安了，这就好比企业上市了，把财务、市场、运营不规范的地方做规范，最后上市实现价值。

　　VC必须心态平和，去帮助别人成功，而不是跟企业抢风头。正如记者写报道，记者的成功是这个人物或者事件的轰动，但是外界对记者本人不见得有什么印象。

　　其次风险投资家得是个杂家，不是专家，必须不断地学习寻找机会，研究成功和失败的案例，研究未来哪个市场可以投入。

　　第三必须对新的东西保持好奇心，没有好奇心，也就不能把握新的机会了。

   中国已经成为投资的天堂，国外VC相继涌入，国内VC迅速成长。但繁荣的背后，大量最需要资金支持的创业企业却拿不到资金。当前，活跃在中国的VC大都投资成长期的、成熟的企业，大量的早期项目、初创企业要获得VC投资非常困难，天使投资人（Angel Investor）看中的正是这个有待开发的领域。

    根据美国创业研究中心（Center for Venture Research）发布的天使投资报告，2007年美国有258,200个活跃的天使投资人，投资了57,120家企业，投资总额为260亿美元，各项数据都比2006年有所增长。而2007年同期风险投资只投资了3,813家企业，投资总额为294亿美元。按照上述统计，天使投资的平均投资额为45.5万美元。

    从1980年后期开始，很多天使投资人就开始互相组织各种形式的俱乐部，共同分享项目源，共同做尽职调查，共同投资以提高投资额度和承担风险。

    国内的天使投资在这几年开始逐步得到媒体和社会关注，但天使投资人已经大量存在，只不过缺少官方的引导和民间的组织，他们也投资了大量耳熟能详的优秀企业。同时，一批曾受益于天使投资和风险投资的企业家，在其企业上市或出售之后，手持大量资金，以天使投资人的身份再次投身于创业圈，扶持在他们眼中富有潜在价值的初创期甚至是种子期的企业，于是出现了像沈南鹏、邓峰、江南春、钱永强、周鸿祎等一批具有代表性的具有成功创业经历的天使投资人。

    但总的说来，国内的天使投资还处于初级阶段。美国的天使投资人数以万计，投资项目数是风险投资的10多倍。而据业内保守估计，中国的天使投资人只能以百为计，投资案例及投资额更是少得可怜。

  1. 什么是合格的天使投资人

    在美国，证券法规定天使投资人必须是合格投资者（Accredited Investors），主要是要满足以下要求： 

● 是投资目标企业的董事、高管、合伙人等；或

● 个人或家庭流动资产超过100万美元；或

● 过去两年的个人收入均超过20万美元，或家庭收入均超过30万美元，并且当年的收入也要维持这个水平。

    这个是硬性规定，如果有某个投资人不是合格投资者，那么法律上，这家创业企业在引入后续VC资金、尤其是IPO的时候会比较麻烦，因为证券交易委员会将会认真研究该公司之前的所有股票发行情况，并且要求公司立即采取行动补救过去违反证券法的行为，这就会延迟、暂停、甚至是毁掉企业的IPO。 

    通常，天使投资人具有一些共同的特征： 

● 30-60岁 

● 年收入超过50万人民币，流动资产超过500万人民币 

● 有过成功的创业经验 

● 愿意长期投资（5-7年） 

● 喜欢为创业者出谋划策，一同做事 

● 投资自己熟悉的行业 

● 通过推荐的方式获得投资机会 

    另外，如果天使投资人可以在业务、资源、后续融资等方面提供帮助，那也不错。比如一位律师作为天使投资人，这意味着创业企业不需要从微薄的初始资金中分出一部分去支付法律事务的账单了。 

    在国内目前满足以上条件做天使投资比较活跃的，主要是一些民营上市企业的高管、私营公司的老板、VC合伙人等。 对于理想的天使投资人，国内知名天使周鸿祎也提出了三个条件：第一，对产业了解，才能规划方向；第二，至少干过企业，知道创业是怎么回事，能够给创业者一些很具体的指点；第三，要有很好的人脉关系，要跟VC熟，给创业企业融到后续资金。

   2. 天使投资的方式

    不管是什么背景的天使投资人，首先要把天使投资作为一种真正的投资，并在法律文件上正规处理，避免给以后的经营管理、继续融资埋下地雷。

    首先，天使投资没有标准的估值。通常天使投资项目的投资前估值是1百万至1、2千万人民币之间，但偶尔也会在这个区间之外。大卫·比尔（David Beer）在英国经营着一个天使投资网络联盟20余年，他得出了一个简单“真理”：“如果只是一个想法（Idea），那么它值1万英镑；如果有一个可以信任的管理团队到位，它可能值10万英镑；如果它把东西卖给了真实的人，并且挣到了真实的钱，那么它值50万英镑”。

    其次，不同的天使投资人喜欢不同的投资形式：优先股（普通股）或者可转债。

    优先股（普通股）方式，也可以说是Pre-VC投资，跟VC投资获得的优先股（普通股）类似，但是附加的投资条款要少一些。对于一个早期创业公司，50万的投资可以获得25%-50%的股份，所以，典型VC的很多条款对天使投资来说杀伤力太大。

    可转债方式，就是运用可转债的债权及期权双重属性，天使投资人每年可以获得约定的利息（通常年息6%-8%），还拥有在未来某个合适的时机（通常是A轮融资时）将其投资转换成股份的权利，并以后续融资的折扣价（25%-40%）转换，以补偿天使投资人所承担的早期风险。

    假设天使投资人投入10万元人民币，他得到拥有25%折扣权利的可转债。A轮VC融资时，如果创业者是以$4元/股的价格给VC发行股份，天使投资人就可以将其投资额以$3元/股（25%折扣）的价格转换成普通股。如果创业者是以$2元/股的价格给VC发行股份，天使投资人的转换价格为$1.5元/股。

    为了保护天使投资人的利益，可转债还可以做一些巧妙的设计：

● 根据后续融资时机调整价格折扣。比如，如果6个月之后创业者还没有完成超过$100万美元的A轮融资，转换折扣从25%提高为35%。

● 控制估值上限。假如创业企业A轮投资前估值为$400万，VC投资$100万，VC获得企业20%的所有权，每股价格为$4元（100万股的原始股份）。天使投资人的可转债以25%的价格折扣转成股份，他的股价就是$3元。要是A轮融资的投资前估值提高到$1000万呢？VC投资$250万，获得20%的股份，股价为$10元，天使投资人25%折扣的股价将是$8元。不太妙，这个价格可能对天使来说太高了。如果先设置一个$800万的估值上限，天使投资人的股份价格上限就是$6元，对比VC的$10美元的股价而言，是40%的折扣了。

  3. 在国内如何做好天使投资人

    国内由于环境和政策的不明朗，以及创业者和投资者之间的信息不对称，甚至包括和后续的VC之间的沟通，都有可能使得天使投资的风险变大，收益得不到保证。 

    首先，要寻找适合天使投资的创业团队，通常这些企业具有如下的特征：

● 有个不错的创业团队，在行业经验上、技术上等有独到之处；

● 有创新的商业模式或产品，也许还处于Idea阶段，企业没有正式开始运营； 

● 创业企业已经开始运作，已经有了一定的发展，商业模式也得到市场验证，比如网站访问量、产品销售量等都有了一定的数据；

● 所在的行业并不热门，可能还没有吸引VC的注意，但潜在空间很大；

● 创始人已经倾其所有，创业者不应该还在别人的公司里兼职或者开着汽车、住着大房子；

● 资金的需求量不大，可能是几十万人民币到几百万人民币之间。

    在和创业者沟通时，要问清楚几个问题： 

● 你愿意出让公司的部分所有权和控制权吗？

● 你可以证明公司在未来3-7年之内实现可观的收入和利润吗？

● 你可以证明公司将会给投资人可观的回报吗？

● 即使你不同意投资人的建议，或者董事会的决定，但仍然可以接受吗？

● 你的企业在3-7年内有退出计划吗？

    另外，以下几点是投资过程中需要注意的： 

● 多和其他天使投资人进行合作。在美国，从80年代后期，就开始有各种各样的天使投资人俱乐部，比如著名的天使投资人网络目录（Directory of Angel Investor Network）就专门收集了各种各样的俱乐部。在这一行，单干是非常危险的，很多时候，一个人的投资，可能最后连为什么失败的原因都会找不到，而联合投资，会少走很多弯路。

● 和VC一样，仔细调查要投的团队，要充分了解创业团队，进行深入交流。投资最重要的就是看人，做任何投资都是这样。除了仔细研究商业计划书之外，更要了解团队的各个方面。一个值得信任的人，哪怕他的商业模式后来改变了也没有关系。IDGVC在中国投资的所有案例中，只有如家的商业模式从头到尾是一样的，其他的都经过各种各样的改变。天使投资也是这样，商业模式可以改进，但是人却是不会变的。

● 做好服务的心态，投资是为了获得高风险补偿的高回报，但是同时要以服务的心态去对待创业企业，成为他们的顾问，理解创业者的困境和他们的目标。对他们提出自己的建议，多给他们带来除了钱以外的资源，用心去帮助企业成长。要像尊重客户那样尊重接受投资的创业者，千万不要有出资人就是老大的想法，那样只会不利于公司的发展。

● 保护自己的权益，和VC进行沟通，企业在后续的发展过程中肯定需要更多的外来资金的帮助，向VC融资是天使投资人在投资的时候就应该考虑到的问题。因此，要帮助创业者制定企业的整体融资规划。由于天使投资一般没有足够的资金进行后续追加，这个时候要注意保护自己的权益，尽量避免因为后续融资过多地稀释自己的股份或者减少自己在创业企业中的权利。

　寻找到一个适合你的VC，也就是说作为者来说，我的一个想法是没有关系这个投资者是中国人还是外国人，没有关系他的钱是美元还是人民币，这些都没有关系，更重要的是要看他是不是一个好的投资者，这是应该创业者更关心的问题。

　　第二个关心的问题，他适合不适合你的投资者，这是关心的第二个问题。什么叫做好的投资者、什么叫做差的投资者？这个东西我觉得应该是可以，无论是本土也好还是国际也好，他们的衡量标准应该是一致的，也就是说好的投资者是可以带来他的价值。我曾经总结过好的VC一般带来哪些价值呢？

　　第一个能够帮助这个企业去更完善它的商业模式，第二个可以帮助企业完善它的团队，因为创业企业从三五个人开始，到最后如果说是成功上市的话，可能上市的时候能有几百上千人的企业，在中间人员的更替、补充，这都是VC可以通过他的人脉关系带来的价值，这是第二点。

　　第三点应该说是帮助企业做业务发展、业务拓展，因为VC他有他的好处，他的价值在于他见得多、识得广，人脉关系很丰富，那么企业有时候你不认识阿里巴巴的马云，但是你觉得阿里巴巴，如果能够跟他建立起一些合作的话会对企业的价值有很大的提升，你需要敲门砖的时候，也许一个好的VC就可以帮助你作为一个好的敲门砖。

　　也许你想见江南春我可以给江南春打个电话，让江南春跟你一起做足疗，类似于这样的一些，帮助你起到一个敲门砖，但是VC并不能说我帮你找到马云把这个搞定，VC做不了这一点，但是VC可以帮助你做多敲门砖的作用，这是VC的价值。

　　第四点好的VC带来的是一些品牌效应的东西，为什么大家都追逐这些美国最大名声的VC，大家一觉得听到他们的名字就觉得很高兴，就是因为他们有他们的品牌，这个品牌可以给创业者、给公司本身带来很多的价值，这也是VC能够体现它的价值的地方。

　　所以说总体上来说，我觉得创业者更应该关心的是好，你是不是应该找到一个好的VC，好的VC给你带来的帮助在于商业模式、团队建设、业务拓展、品牌提升四个方面。

我补充一下，我觉得中国现在确实是一个特别好的时期，我有一再在很多地方说，中国是创业者的天堂。

　　不仅是有这么好的关系，我们社会又稳定，有很大的市场的机会，社会也鼓励创新来做创业者，因为前面有很多的成功者做榜样，而且有很多的钱，是一个创业者的天堂。

　　但是越是到这样的时候，我在这边，我刚才想加一句，我不是给大家泼冷水，一定要有清醒的头脑，因为美国就同样出现过这个问题，就是在1999年的时候，美国1995年投的情况非常好，在1999年取得了巨大的回报，回报很高，所以在1999年融了很多的钱，每一个基金都是特别好、特别多。

　　但是也很热，投的价格也好，好像每一个人只要沾上一个VC就一下子能够点石成金似的，可是后来的结果是都不好，因为美国出现了911，又出现了互联网的泡沫，所以在1999年融的钱没有一个基金好的，可是在中国我们做得好的一些都是在1999年前后投的。

　　现在我们看到的都是1999年前后投的，因为这样所以国外的基金一看，好的全是在中国投的，所以全往中国跑，我就跟我所有的同事一起跟大家说，你想做这个事情千万不要头脑发热，投资是一个很专业的事情，它的市场的规模、发展的延展性，还有就是说你的产品、创意、团队，就是这三个简单的事情，一定要把这个功夫做好。

　　另外在中国有很多的特点是国外不具有的，虽然我们是名牌的公司等等的，一定要学习怎么在中国做一个成功的事业，这样的话你才能把这个事情做好。

　　我有一个朋友讲一个事儿，他喜欢收藏古董，过去收藏了很多的东西，他说我没钱的时候买的东西都特别好、特别值，当我有钱的时候买的东西都不值，都买贵了。

　　他的有道理的时候的一点就是说，你没钱的时候就花很多的时间去学习、琢磨，就花了很多的时间去，有钱的时候花钱就快了，做的功夫就不够了，买的东西不好。所以我觉得没有钱的时候好，有钱的时候千万注意不要头脑发热，做投资就是要花很多的时间练内功。

　　所以说我一直说，中国既是投资者的天堂，也是对我们这些创业者的天堂，对我们投资来讲永远是一个炼狱，一定要练你的内功才能够把这个事情做好，不管是人民币还是外币，都是同一个道理。

John Osher discussed What Not To Do: 17 most common mistakes start-ups make and how to avoid them in Entrepreneur Magazine. Each of the mistakes are a topic on their own, for example, I’ve trying to provide examples of high level market and financial analysis. Mistakes 1-8 focus on the market and financial requirements of a startup. Mistakes 9-10 focus on hiring and corporate management. Mistake 11 is about product design and technology. Mistakes 12-17 are about focus and vision. It is a very interesting read for building an appropriate mind-set for entrepreneurs.

1. Failing to spend enough time researching the business idea to see if it’s viable. “This is really the most important mistake of all. They say 9 [out] of 10 entrepreneurs fail because they’re undercapitalized or have the wrong people. I say 9 [out] of 10 people fail because their original concept is not viable. They want to be in business so much that they often don’t do the work they need to do ahead of time, so everything they do is doomed. They can be very talented, do everything else right, and fail because they have ideas that are flawed.”
2. Miscalculating market size, timing, ease of entry and potential market share. “Most new entrepreneurs get very excited over an idea and don’t look for the truth about how many people will want to buy it. They put together financial projections as part of a presentation to pump up their investors. They say, ‘The market size is 50 million people that could use this product, and if I could only sell to 2 percent of them, I’d be selling a million pieces.’ But 2 percent of a market is a lot. Most products sell way less than 1 percent.”
3. Underestimating financial requirements and timing. “They set their financial requirements based on Mistake 1, and they go ahead and make a commitment to this much office space and this many computers, and hire a vice president of sales, and so on. Before they know it, based on sales projections that were wrong to start with, they have created costs that require those projections to be met. So they run out of money.”
4. Overprojecting sales volume and timing. “They have already miscalculated the size of the market. Now they overproject their portion of it. They often say ‘There are 200 million homes, and I need to sell [to] x number of them.’ When you break it down, though, a much smaller number of those are really sales prospects. That makes it impossible to make their sales projections.”
5. Making cost projections that are too low. “Their cost projections are always too low. Part of the reason is that they project much higher sales. There are also unknown reasons that always come out that usually make costs higher than planned. So on top of everything, their margins are now lower.”
6. Hiring too many people and spending too much on offices and facilities. “Now you have lower sales, higher costs and too much overhead. These are the things that you see every day in companies that fail. And they all grow out of that first mistake: failing to research the size and viability of the opportunity.”
7. Lacking a contingency plan for a shortfall in expectations. “Even if you’re realistic in your estimates to start, there are things that happen when you start a new business. Your sales ideas may be no good; bank rates may go up; there may be a shipping strike. These aren’t the result of poor planning, but they happen. More often than not, entrepreneurs just feel that something will come along when they need it. They don’t have contingency plans for it not working out at the size and time they want.”
8. Bringing in unnecessary partners. “There are certain partners you need. For instance, you often need money, so you’re going to need money partners. But too many times, the guy with the idea takes on all his friends as partners. Many people don’t provide strategic advantages and don’t warrant ownership. But they’re all going to get 25 percent of the company. It’s totally unnecessary, and it’s a mistake. Before people are made partners, they have to earn it.”
9. Hiring for convenience rather than skill requirements. “In my first business or two, I hired relatives. It was easy to do, but in many cases, they were the wrong people [for the job]. And it’s hard to fire people, especially if they’re relatives or friends. More time needs to be spent handpicking people based on skill requirements. You really need super-skilled people who can wear more than one hat. It just bogs you down when you hire people who can’t do the job.”
10. Neglecting to manage the entire company as a whole. “You see this happen all the time. They’ll spend half their time doing something that represents 5 percent of their business. You have to have a view of your whole company. But too often, the person running it loses that view. They get involved in a part, and they don’t manage the whole. Whether I do this product or that product, whether I hire somebody, [I consider] how they [will] fit long term and short term in the big picture. Constantly try to see your big picture.”
11. Accepting that it’s “not possible” too easily rather than finding a way. “I had an engineer who was a very good engineer, but with every toy we developed, he would say, ‘You can’t do it that way.’ I had to be careful not to accept this too easily. I had to look further. If you’re an entrepreneur, you’re going to break new ground. A lot of people are going to say it’s not possible. You can’t accept that too easily. A good entrepreneur is going to find a way.”
12. Focusing too much on sales volume and company size rather than profit. “Too much of your management is often based on volume and size. So many entrepreneurs want to say ‘I have a company that’s this big, with this many people, this many square feet of space, and this much sales.’ It’s too much [emphasis] on how fast and big you can build a business rather than how much profit it can make. Bankers and investors don’t like this. Entrepreneurs are so into creating and building, but they also have to learn to become good [businesspeople].”
13. Seeking confirmation of your actions rather than seeking the truth. “This often happens: You want to do something, so you talk about it with people who work for you. You talk to [your] family and friends. But you’re only looking for confirmation; you’re not looking for the truth. You’re looking for somebody to tell you you’re right. But the truth always comes out. So we [test] our products, and we listen to what [the testers] say. We give much more value to the truth than to people saying what we’re doing is great.”
14. Lacking simplicity in your vision. “Many entrepreneurs go in too many directions at once and do not execute anything well. Rather than focusing on doing everything right to sell to their biggest markets, they divide the attention of their people and their time, trying to do too many things at [one time]. Then their main product isn’t done properly because they’re doing so many different things. They have an idea and say they’re going to sell it to Wal-Mart. Then they say they’re going to sell to [the] Home Shopping Network. And then the gift market looks good. And so on.”
15. Lacking clarity of your long-term aim and business purpose. “You should have an idea of what your long-term aim is. It doesn’t mean that won’t change, but when you aim an arrow, you have to be aiming at a target. This [concept will] often come up when people ask ‘How do I pick a product?’ The answer depends on what you’re trying to do. If you’re trying to [create] a billion-dollar company with this product, it may not have a chance. But if you’re trying to make a $5 million company, it can work. Or if you’re trying to create a company [in which] family members can be employed, it can work. Clarity of your business purpose is very important [but] is often not really part of the thought process.”
16. Lacking focus and identity. “This was written from the viewpoint of building the company as a valuable entity. The company itself is also a product. Too many companies try to go after too many targets at once and end up with a potpourri rather than a focused business entity with an identity. When you try to make a business, it’s very important to maintain a focus and an identity. Don’t let it become a potpourri, or it loses its power. For instance, you say, ‘We’re already selling to Kmart, so we might as well make a toy because Kmart buys toys.’ If you do that, the company becomes weaker. A company needs to be focused on what it is. Then its power builds from that.”
17. Lacking an exit strategy. “Have an exit plan, and create your business to satisfy that plan. For instance, I am thinking I might run my new business for two years and then get out of it. I think it’s an opportunity to make a tremendous amount of money for two years, but I’m not sure [whether] it’s proprietary enough to stop the competition from getting in. So I’m in with an exit strategy of doing it for two years and then winding down. I won’t commit to long-term leases, and after the first year, we’ll start watching the marketplace very closely and start watching inventories.

VC属于alternative investment中的一种，因此，拿指数作为参考也是可以的

I got into a discussion yesterday with a colleague about financial performance measures. We started off talking about hedge fund managers being selective about such things, and then got to mulling venture capitalists comparing fund performance to public market indices (which they only do, of course, when they’re beating said indices soundly).

Nevertheless, said VCs’ usual index of choice is the S&P 500. But why? As my colleague argued, the S&P 500, while a well-known index, and in many ways synonymous with U.S. capital markets, is decent for some performance measurements, mediocre for others, and downright wrong for still more.

In this case, it doesn’t make much sense for VCs to compare themselves to the S&P 500 merely to give themselves capital markets comparability. After all, the sorts of companies in the S&P 500 are nothing like the sorts of companies in a venture portfolio. And at the same time, any fund manager making an allocation to venture is not likely reallocating from money earmarked for large-cap indexing, but more likely from small-cap growth.

With the preceding in mind, a better index might be the Russell 2500, or even the Russell 2000. Both of those skew to smaller companies, both in terms of sales and market capitalization, and are therefore more similar to the sorts of emerging companies you find in a typical VC’s portfolio.

Here are the two indices compared over the last 5 years. As you can see, while the S&P 500 has done okay, the Russell 2000 has outperformed it handily, while being considerably more more volatile. Needless to say, perhaps, returns of both the Russell 2000 and the S&P 500 fairly handily stomped the 5-year returns of VCs, with the latter turning in an 8.5-percent annualized number (as of 12/31/2007).

Here, for comparison, are the 12/31/2007 venture numbers, as provided by the NVCA. As you can see, they include the usual S&P 500 comparison. (As an aside, some VCs like to fall back on the industry’s good 1-, 3-, and 10-year numbers, and brush aside the 5-year numbers. Admittedly, that is a fun game, but the first two numbers are too short to be meaningful, while the 10-year number is badly skewed by the bubble.)

　　一般第一感觉挺重要的。如果第一感觉不好，我不会再花很多的时间去论证为什么我感觉不好，是错的，我是应该继续去看。但是如果第一感觉是好的，后面会花很多时间去论证，这个感觉确实是正确的，这确实是一个值得投的企业。所以，就看是哪一步。也有很多朋友问，第一次见面你会花多长时间，怎么样才能跨过这个门槛，后面大家才会花很多精力做尽职调查。一般大概在30分钟到一个小时，这样的一个时间里面，总得有点感觉。这些感觉可以是多方面的，有时候是因为生意的模式真的很新颖，听起来确实是蛮有意思的，能不能做成，能做多大，能不能赚钱，还不一定想清楚了，但听过以后觉得很有意思，值得再花时间。或者是见了这个团队以后，他们过去是这么一个优秀的团队出来，做什么都可以，或者是有时候过去已经认识的，对他们也很尊敬 ，这样的人出来创业。所以，两种都会导致后面进行更深入的调查。

　　有感觉的团队或项目，就像谈恋爱，初次见面的第一感觉如果好，就再约，下次再吃饭。如果第一次见面人不能让我觉得这个人是厉害的，或者是这是蛮有意思的一个项目，我可能就不一定再继续了。

　　在投资这个行当里，我觉得更多可能是一个个人的偏好。所以，我自己的一些偏好，可能跟Gary，跟甘剑平的有点不一样。我自己比较喜欢做两类，一类是比较早期的，比较偏门。或者是比较成熟，已经在他要从事的这个行业里是比较清晰的领先者。这两种我都会做。我会花很多精力，会掺和到这个事情里，不叫管理。我比较喜欢多参与。一个确实是我还比较有责任心。另外，我就是因为这个原因才干这一行。

　　对创业者，第一点，一定要尊重，我很强调这一点。我对创业者能够放弃其他的很多东西，出来创办企业，这么辛苦来做这个事情，很尊敬。所以，我跟他们都关系还是挺好的，但在工作这一边。在私交方面，我可能有点太保守了，私交方面我一般不大跟我们的创投企业的高管有太多私交的关系，反而跟我离开的企业有很多联系。总的来讲，做一个VC，我觉得我对企业这边要有责任，希望把他们做好。在VC投资这一边，我觉得我也有一个责任，如果这个CEO确实不能把这个事情做好，在适当的时候该换人还得换人，天天没事跟人出去打场球，明天又出去唱个歌，后天又跟人家讲你要下课了，这好像是不大好的事情。一般来讲，我很尊敬他们、尊重他们，努力一起把这个事情做好，但是该下一个决定的时候、下决心的时候，我还是会下决心。

也许，但是，你要找的肯定不是vc

什么样的人拿着创意就能融资呢？也许，销售人员可以达到，因为它们是salesmen

A reader asks:

“I’m an entrepreneur looking for seed investment. All I have right now is an idea and a pitch. I’m presently pitching friends and family and it has been very positive. Do you know any other idea investors I should approach?”

Investors want to see products and preferably traction unless you already have a
significant track record. But,

If you only have an idea.

If you have no traction, track record, or product—if you have nothing but an idea for a product in a large market, the only people who will meet you are:

1. Family and Relationship Investors: People who already know you and are willing to bet on you, based on your history together. They’re not betting on the company, they’re betting on you. They wouldn’t invest in the company if you were replaced by someone who was equally effective. Todd Vernon calls these people family and relationship investors.
2. Idea Investors: People who believe there’s a big opportunity to serve the customer because they understand the customer as well as you do. Perhaps they’ve noticed the same opportunity as you but they haven’t done anything about it.
   
3. Once Removed Investors: These investors trust or regularly co-invest with one of your family, relationship, or idea investors.

That’s it. These investors sometimes have little to no experience investing in companies, but that is not an insurmountable hurdle. You will need traction, a track record, or a product to get meetings with other traditional seed stage investors.

In general, the more you need money, the less likely you are to get it. But making something out of nothing is what entrepreneurs do.

Another option: Cold call funds.

There are a few funds like Y Combinator, Seedcamp, and TechStars who will look at applications from anybody doing anything. But you will probably need traction, a track record, or a compelling product to capture their interest—ideas need not apply.

Salesmen are an exception.

Salesmen are good at getting people to comply with their wishes. That’s what it means to be a salesman. Great salesmen can get meetings and raise money with just a large market and an idea (and maybe a sprinkling of track record).