What is a startup?A startup is a company designed to grow fast. Being newly founded does not in itself make the company a startup. Nor is it necessary for a startup to work on technology, or take venture funding, or have some sort of "exit". The only essential thing is growth. Everything else we associate with startups follows from growth
What is Venture Capital?
Venture Capital is the funding investors provide to the high-growth potential start-ups in exchange for equity in the company.
In a simple context, venture capital is provided to start-ups (not any new company) which are growing at a remarkable rate and are in need of money to sustain that growth. The investor, in return, demands equity or an ownership stake in the company.
What is a Venture Capitalist?
A venture capitalist is a professional investor or firm who funds early-stage startups in exchange for an equity stake.
Venture capitalists are usually formed as limited partnerships where the partners invest in the VC funds. These partners are usually categorized into two types – the Limited Partners (LPs) and General Partners (GPs).
Key Performance Indicators
Sales Oriented
1. No. of New Contracts Signed Per Period2. Value for New Contracts Signed Per Period
3. No. of Engaged Qualified Leads in Sales Funnel
4. Hours of Resources Spent on Sales Follow Up
5. Average Time for Conversion Net Sales – Value or Percentage Growth
Financial KPIs
1. Growth in Revenue2. Net Profit Margin
3. Gross Profit Margin
4. Operational Cash Flow
5. Current Accounts Receivables
6. Inventory Turnover
7. EBITDA Margins
Customer Oriented
1. No. of Customers Retained2. Percentage of Market Share
3. Net Promoter Score
4. Average Ticket / Support Resolution Time
Operational KPIs
1. Order Fulfillment Time2. Time to Market
3. Employee Satisfaction Rate
4. Employee Churn Rate
Marketing KPIs
1. Website Traffic2. Qualified Leads
3. Customer Conversion Rate
4. Customer Acquisition Cost
What makes a business investible?
| POSITIVES | NEGATIVES |
|---|---|
| Strong Promoter Background | Heavy CAPEX Business |
| Clarity in Returns / Exits | Limited Exit Options for Investors |
| Scalability of the Company | Low Promoter Share Holding |
| Good Product Validation | Unstable Business Economics |
| Good Values of KPIs | Slow Business Growth |
| Good Order Book & Market Fit | Long Return on Investment Timeframe |
Valuation Methodologies
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Share Capitalization
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