Q:  Everyone tells me the way to approach a venture capitalist I don't know is through a friendly introduction from someone who already knows that VC. But what happens if I don't have the connections to get that introduction? Am I screwed? A:  (Chris) Every entrepreneur who has raised venture [...]

Fred Wilson has another excellent post up titled Venture Fund Economics: When One Deal Returns The Fund.  He continues his expose on how VC funds work and builds his thoughts in this post around the statement: "Every really good venture fund I have been involved in or have witnessed has [...]

Q: When we talk about the equity percentage numbers for those directors and other early participants, are these numbers based on the total number of shares prior to a funding event or does the base share number include those allocated for investors as well? As the shares for future investors [...]

Fred Wilson has another post on Venture Fund Returns titled Gross and Net Returns.  AsktheVC would like to formally thank Fred for doing our work for us, as we periodically get questions about how VC funds work and to this point have not written posts nearly as detailed as Fred's.[...]

Q: From my limited perspective, venture debt in proximity to an A round seems awfully premature -- restrictive debt coverage ratios, warrant coverage on preferred terms, etc -- yet there seems to be an awful lot of venture debt investors out there who essentially have no response to these concerns [...]

Q: My lawyer is asking for a "success fee" for a referral to a potential investor in my business. Since he'll be doing the legal work, he's offered to charge only 3% on the amount funded (solely from this one contact) as opposed to a 5% that a typical investment [...]

Today's great post of the day is from Fred Wilson titled The IPO Debate.  There were no VC-backed IPOs in Q208 - the first time this has happened since 1978.  The National Venture Capital Association (NVCA) is doing a big media push to get the word out about this and [...]

Q:  We just started looking for venture funding and I have a question. Why do VC's ask us how our idea came about? Are they looking for an emotional and inspiring story or are they worried that we may have taken our idea from someone else or, what I believe [...]

Q: I am trying to determine the appropriate equity position for my startup's board members.  They are arguing that they are "founding" board members. They have put in a few hours a month of their time for around a year, have been very helpful with introductions, and have sat in [...]

Q: Thank you very much for your term sheet series.  Not being that familiar with "specific" term sheets, I have heard something about VC terms that effectively allow the VC to fire the founder(s) and in the process relieve them of their shares since they had then left the company [...]

I'm not a fan of convertible notes as the form of an angel investment.  When I'm making an angel investment, I much prefer to price the round and do a "light Series A" (simple terms, but still a preferred instrument.)  Basil Peters has a series of posts up on Angel [...]

Q:  What kind of benefits do start-ups typically offer? I don't mean salary or equity: about which you already posted a lot of information. I am talking about health and life insurance, disability insurance - all of the typical benefits one receives when working for a large and established business. [...]

Q: Is it a bad idea to send a business plan to too many VC firms? I have access to a large list of VCs that invest in my type of company and I was thinking about blasting out a business plan to all them. My thought process is it [...]

Todd Vernon has today's great post of the day titled Angel Financing.  Todd is the CEO of Lijit (one of our portfolio companies - if you are a blogger - go check it out) and just completely nails the different types of angel investors and the issues surrounding how an [...]

One of my favorite VC posts of all times was my partner Seth Levine's post titled How to become a venture capitalist.  I regularly get emails from folks looking for a job in the VC industry and I almost always point them at this post. Seth has followed up with [...]

Q: I am the co-founder of a startup that is currently in the process of trying to raise an early stage venture round. We recently brought on an advisor who has been incredibly successful in our space and has made introductions to dozens of potential partners and VC firms where [...]

So today's "great post" comes from er... me.  :)  Okay, so my partner Ryan and I did a podcast last week with Larry Nelson of W3W3 and our conversation covered both the intellectual property and patent issues we've faced as investors in high-technology companies. We definitely have a love/hate (ok, [...]

Bill Burnham has today's best VC blog of the day titled 4 Things to Do After You Get Your First Term Sheet.  As a special bonus, the second best VC blog of the day is Fred Wilson's post titled From Messes To Successes.  Fred had a post in him titled [...]

Q:  I self-financed and run a profitable Internet based start-up with more customers than I can handle. I can take the business to where it needs to be without outside funding. However, it will take much longer to grow organically. I've considered working with financiers for guidance and capital. What [...]

Q: What type of structure have you seen where the VC agrees to fund over some time period 18-24 months and up to some level. A: (Brad): These are commonly called "Tranched Financings."  The typical approach is that a VC commits to fund a specific amount in multiple "tranches" based [...]

Q: What do you expect to see from an entrepreneur whom you don't know or have a casual introduction to before scheduling time to listen to a pitch? A one-pager? A complete powerpoint? A classic business plan or a casual one? A: (Brad) While everyone is a little different, I'm [...]

Today's great post is from Josh Kopelman and is titled I Don't Know.  In it he describes two meetings and explains the key importance of founder credibility - and why the founder in the second meeting had much more credibility than the one in the first.  Oh - and he [...]

Q: Say I have an angel (SEC accredited) who's ready to invest at an amount well below $100k. How would this impact on a future round with VCs? Is there some standard or average pre-money and post-money that happens in angel deals? Also, the angel in question is a family [...]

Jeff Bussgang has today's great post up titled Let's Play "Blame The VC."  It's something that regularly confounds VCs and entrepreneurs alike.  The punch line: "Then, when you don't get funding, play "blame the VC".  Tell all your friends that those risk-averse idiots wouldn't know a good deal if it [...]

Today's great VC blog post once again comes from Fred Wilson and is titled Conviction and Discipline.  Having made a lot of investing mistakes in 1999 and 2000, I learned this lesson many times over.  It's also consistent with the Fantastic Notes from an Interview with Warren Buffett that I [...]