Yes, you need a business plan

By rickColosimo / February 7, 2017 / Comments Off on Yes, you need a business plan

Every now and then someone who has an idea for a company or a product will ask me, “Do I really need a business plan?” I guess they read about seemingly ethereal companies raising huge equity rounds at mind-boggling valuations and believe the sizzle of “no business plan.” If you don’t have a business plan…

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Why are there earnouts?

By rickColosimo / February 4, 2017 / Comments Off on Why are there earnouts?

I was at a presentation recently on M&A exits for business owners. The question of earnouts came up, but although the panel was generally well-informed (I work for one of them, the managing partner of my firm, and with another, an accountant who works with several of our clients), they never clearly stated the fundamental…

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How do startup valuations work?

By rickColosimo / May 10, 2016 / Comments Off on How do startup valuations work?

Building on the startup-oriented tools that Rick has published on his startup law website, we’ve created a simplified valuation framework for you. We’ve extracted this tool from financial models and valuations we’ve built for clients over the years. The multiples have to be adjusted for a specific business and market, but the current values are…

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Too much runway

By rickColosimo / March 2, 2016 / Comments Off on Too much runway

Too much runway, and you may never take off. Here’s the write-up I saw in the Next Draft newsletter (hey there, Dave!) that pointed me to a story about Slack’s then-recent venture financing: Give me some slack … equity. The company’s product is about a year old. But investors just invested $120 million into Slack…

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