GyopoPlayboy said:
Not to be rude, but is English your second language?
It's an expression letting us know that he's talking about his own real world experience rather than theory.
Yes, the someone who has been there is him.
Starting and Growing a Successful Business
- Thread starter Gringuito
- Start date
Not to be rude, but is English your second language?
It's an expression letting us know that he's talking about his own real world experience rather than theory.
Yes, the someone who has been there is him.
Hef said:
Normally you'll back your valuation with numbers on what peers are doing. If you're in an area that's "hot" at the moment, then other similar companies will have been funded and you can use those valuations for comparison. Then you'll throw in some metrics, like maybe all companies don't have revenue, but they have X number of users and you have 2X and scale accordingly. CrunchBase has some funding numbers and their data is free. There's also a company that sells this information on a subscription basis, in more detail. I forget the name as it's been years since I used it, but I think it was from Thomson Reuters.
^Give an inch, they take a mile.
Abnormal said:
It's quite rude to bombard someone with questions like that. It would take a lot of work to answer that list, and your questions are obviously generalised nonsense rather than specific to your own needs.
Is this some sort of new trolling method?
^ i already personally answered this question. On the "whatsapp" thread on EE.
27B messages in a day securely converted. Wwt posted a hint as well but I gave up on the thread a while ago and will no longer give more information on the deal/technology and or valuation.
I will, answer the last part though. No there is no cussing that is big media bullshit. It is more like poker and passive aggressiveness. It is "intense" but not yelling, cussing, blackmailing etc. that is for children and the 99%.
---
Anyway, I hope gringuito can provide more color on how he evaluates people, hence my little set trap sales force question but that's again explaining the "knack" which is god awfully difficult to do.
--
Edit: I find it appropriate that I just hit 3,000 posts and personally owned myself by giving long winded responses to a guy who has 6 posts....I am ashamed of myself right now lol.fucking mobile! Roosh please find a way to put post history on mobile I will pay you for it!
Good night guys!
27B messages in a day securely converted. Wwt posted a hint as well but I gave up on the thread a while ago and will no longer give more information on the deal/technology and or valuation.
I will, answer the last part though. No there is no cussing that is big media bullshit. It is more like poker and passive aggressiveness. It is "intense" but not yelling, cussing, blackmailing etc. that is for children and the 99%.
---
Anyway, I hope gringuito can provide more color on how he evaluates people, hence my little set trap sales force question but that's again explaining the "knack" which is god awfully difficult to do.
--
Edit: I find it appropriate that I just hit 3,000 posts and personally owned myself by giving long winded responses to a guy who has 6 posts....I am ashamed of myself right now lol.fucking mobile! Roosh please find a way to put post history on mobile I will pay you for it!
Good night guys!
WestCoast said:
Thanks for the response. Determining the value is what I'm interested in. Question is how to get there. Traditional valuation process is one way. I'm sure there are other ways, that's why I hinted at "throwing darts"... charm, seduction, politics, throwing your weight around, bs, blackmail, threats, etc are also other methods.
I'm a firm believer that you don't get what you deserve - you get what you negotiate for.
^ I am going to give you a business tip. There are a total of 3 questions (i am being generous maybe 2) in there that are business related, the rest are keyboard jockey "I am just going to waste your time with pie in the sky questions"
Some of them are downright insulting for a guy like him (obviously he is cool and doesn't care but 99.99% of people are not like this) because it shows you didn't even bother looking up the answer a perfect example is eg. How do you find other buyers... 5 seconds of google will get you the answer.
I don't know how anyone with a good conscious can ask so much of someone who has better things to do, that is why it was incredibly rude.
Do not waste the time of people who can help you.
Some of them are downright insulting for a guy like him (obviously he is cool and doesn't care but 99.99% of people are not like this) because it shows you didn't even bother looking up the answer a perfect example is eg. How do you find other buyers... 5 seconds of google will get you the answer.
I don't know how anyone with a good conscious can ask so much of someone who has better things to do, that is why it was incredibly rude.
Do not waste the time of people who can help you.
Abnormal said:
You need to respect others time. You asked a lot of general questions that would take a long time to answer if even possible without looking at specifics.
WestCoast said:
That thread is so long. I'm loathe to read it. But thanks for pointing it out.
As for evaluating newhires/people, I think it's very hard to tell from an interview, or even three. I'm a firm believer of trial periods (1-3 months). I want to see what happens when the rubber meets the road.
Cattle Rustler said:
Yo abnormal, I have a few questions for you too...
What kind of toothbrush do you use?
What do you recommend for breakfast?
What do you think about haters?
Where do you get your inspiration from?
How old are you?
What have you learned today?
If you were going to write a book, what would you call it and what would it be about?
What’s one of the scariest things you’ve ever done?
What accomplishment are you most proud of?
How did you meet your spouse / girlfriend / boyfriend?
Do you think it’s better to get married when you’re young or better to wait a while?
Have you ever thought of adopting?
If you could go back in history, who would you like to meet?
Let's get back on topic. Abnormal, if you rewrite a list of more focused questions I'd be happy to answer.
I'm an angel investor so I can't speak about how VCs do it. I really like what WestCoast said about value is important not valuation. When I'm valuing a company I look at it as an investment. What that means is that I'm considering how much money will I tie up for how long with what kind of return and at what risk. For example, say I have to invest $5M into a company and the possible exit is 4 years away. I look at the comparable companies in the market and any recent M&A activity. I look at the total market size and how much of it they want to grab. I really look hard at the management team. Have they raised money before and sold a company before. I like to ask them for references and at least one person they had to fire. By talking to someone they let go you get a more honest feeling for who they are. I don't believe what a fired employee says, it's more about the temperament of the CEO doing the firing.
I take all that into consideration and I determine the risk of losing my money or it being stuck in the company for much longer than I would like. I use this to back into what kind of return I need to get from the $5M to justify the investment. From that I get what percentage of the company I need to get that return.
This is an overly simplified case just to explain the process. In reality there are normally existing investors by the time the company gets to me and there are other angels as well. We all jockey for position and for our best interests. It's a fun game.
As WestCoast said it's formal and a bit tense but never openly angry. You both have your group of lawyers and accountants in a large conference room. Sometimes I sit there thinking about how much money I'm spending each minute while all the lawyers argue about some minute wording of an obscure section of the agreement. It's often really fun. Most business owners are great people to be around and know how to use humor to diffuse situations.
Hef said:
I'm an angel investor so I can't speak about how VCs do it. I really like what WestCoast said about value is important not valuation. When I'm valuing a company I look at it as an investment. What that means is that I'm considering how much money will I tie up for how long with what kind of return and at what risk. For example, say I have to invest $5M into a company and the possible exit is 4 years away. I look at the comparable companies in the market and any recent M&A activity. I look at the total market size and how much of it they want to grab. I really look hard at the management team. Have they raised money before and sold a company before. I like to ask them for references and at least one person they had to fire. By talking to someone they let go you get a more honest feeling for who they are. I don't believe what a fired employee says, it's more about the temperament of the CEO doing the firing.
I take all that into consideration and I determine the risk of losing my money or it being stuck in the company for much longer than I would like. I use this to back into what kind of return I need to get from the $5M to justify the investment. From that I get what percentage of the company I need to get that return.
This is an overly simplified case just to explain the process. In reality there are normally existing investors by the time the company gets to me and there are other angels as well. We all jockey for position and for our best interests. It's a fun game.
Hef said:
As WestCoast said it's formal and a bit tense but never openly angry. You both have your group of lawyers and accountants in a large conference room. Sometimes I sit there thinking about how much money I'm spending each minute while all the lawyers argue about some minute wording of an obscure section of the agreement. It's often really fun. Most business owners are great people to be around and know how to use humor to diffuse situations.
Hef said:
This is true, you'll never know how good someone is for your company until after they are working. Depending on your company size and if the person is a protected class, letting a person go after their trail period can be expensive.
For sales people it's important that they bring clients with them. In my markets the sales cycle is a bit long so a trial period is less effective. You can look at the sales pipeline reports all day but closing is what matters.
cardguy said:
It consumes you. All your employees get to go home and sleep and you're still thinking about how to do better, go farther. You learn about failure in a very personal way. If you screw up you have to tell someone you like, who's wife and kids you know, that they have to leave the company because of cutbacks. They didn't do anything wrong, you did.
I may have to amend my answer about if everyone is able to be a business owner. If you have the right personality and motivations you'll do great.
Gringuito I think I finally came up with a way to phrase this to avoid outing your identity.
So you stated you want to see a track record etc etc...
Now let me ask.
How do you value a person's idea/personality if he/she has no track record of previous successful businesses?
Ie personality and execution how can you evaluate that from a start up perspective.
This is probably very hard to type/help give guidance but would be awesome to know how you evaluate talent. (Lets just assume the market size all checks out etc and the area does have exit opps eg. M&A activity)
So you stated you want to see a track record etc etc...
Now let me ask.
How do you value a person's idea/personality if he/she has no track record of previous successful businesses?
Ie personality and execution how can you evaluate that from a start up perspective.
This is probably very hard to type/help give guidance but would be awesome to know how you evaluate talent. (Lets just assume the market size all checks out etc and the area does have exit opps eg. M&A activity)
AntiTrace
Ostrich
WestCoast said:
Very good question.
If your thinking of investing in a company that is headed by someone with passion, intelligence, determination, but absolutely no business experience or track records of leadership and success what would be your thought process?
well maybe absolutely no track record of leadership and success is going a bit too far. But I'm sure you get the gist of the question.
WestCoast said:
I don't have any magic when it comes to evaluating talent with no track record. How can I know how someone will do the first time running a company when they themselves don't know.
I'm a more conservative investor in that regard. When I've been pitched what I think is a good idea from a group with little or no experience I either 1) walk away from the deal or 2) require that some of my people take management positions. (which almost never ends up happening) I'd rather get a smaller return from a much less risky investment. I've passed up some good opportunities because I couldn't get a handle on the risk from too many unknowns.
I also prefer companies that can be cash flow positive in around 18 months and not more than 3 years. If it requires longer than that I think a VC would be a better fit.