Tuesday, May 26, 2020

Buying and Selling Businesses During the Covid-19 Quarantine - Haroon Bhatti and Ren Carlton- Part 1




Topics

  • Introducing business expert Haroon Bhatti, MBA, MSF
  • Bitcoin and Crypto-assets
  • Covid-19 quarantine
  • Who is currently buying businesses?
  • Who is currently selling businesses?



Watch all three parts of this conversation here:


https://youtu.be/0lyGg4CUA9w
https://youtu.be/EUQ78IqdRTQ
https://youtu.be/D3yH-0_0Qbk



Are you interested in buying or selling a businesses? Email info@OmegaAccelerator.com for your free business valuation and consultation.


Do you have a message you would like to share with our network of over 20,000 entrepreneurs and business owners? Message us today, Ideas@moneyforastartup.com


Are you looking for investors for your business, contact us today, funding@omegaaccelerator.com.


Are you interested in angel investing and helping us fund early-stage businesses? Email info@OmegaAccelerator.com.

Sources and Links


https://www.linkedin.com/in/rencarlton
https://rencarlton.blogspot.com
https://twitter.com/RenCarlton
https://www.youtube.com/channel/UCmxQWgUDlPJo0IHCIa6SzrQ
https://omegalegacyacceleratorx.com/924-2/https://www.facebook.com/TheOmegaAccelerator/
https://www.instagram.com/omega.funding/
https://rencarlton.blogspot.com/2019/09/funding-session-with-ren-carlton.html
Disclaimer: This does not constitute an offer to sell, a solicitation of an offer to buy, or a recommendation of any security or any other product or service. We are not offering any legal, investment, tax, or medical advice. Please consult the appropriate professional before doing anything you learn from the content posted on any of our digital properties. All stories are based on true events, but are altered to protect the identity of the individuals involved.

Tuesday, May 19, 2020

How much money does a startup need? The Fifth Powerful Secret to Battling Giant Competitors - Resources - How Startups can Competing Against FAANG - Facebook, Amazon, Apple, Netflix, Alphabet Google - David vs. Goliath


blackjack

This is part five of a series we are doing on David vs. Goliath and battling giants. I will talk about how startups can compete against the FAANG companies and other major, well-funded, legacy competitors. The FAANG are Facebook FB, Amazon AMZN, Apple AAP, Netflix NFLX; and Alphabet/Google GOOG.

Click here for part 1
Click here for part 2
Click here for part 3
Click here for part 4


The Fifth Powerful Secret to Battling Giant Competitors - Resources


Then he (David) took his staff in his hand, chose five smooth stones from the stream, put them in the pouch of his shepherd’s bag and, with his sling in his hand, approached the Philistine.

Samuel 17

Although David did not have many resources, he had what he needed to win the battle.

When battling giant competitors, you will need resources. Resources are purchased with money, e.g. capital. Since you will have significantly less resources than your competitors, you will need to use those resources wisely.   


How much money does a startup need? 

Based on our research and personal experience, we find that most early-stage, pre-revenue companies raise between $25,000-$500,000. It is tough to ask for more without giving away your company.

When looking for funding, is important to create forecasts, showing your potential funding sources how you will use the cash. And even more importantly, when you will be profitable so you can pay it back.

Obviously you want to raise as much cash as possible. However, if your company is early stage and has a valuation under $1M, you cannot ask for a $5M investment. The investor would be buying your company five times over. If your valuation is around $1M, you can ask for $200K–$300K, and offer 20–30% of your company in exchange.

Valuing a company can be tough. One of my favorite methods is the development stage valuation approach. It is often used by angel investors and venture capital firms to generate a rough range of company value. Investors set these values based on their experience and values vary depending on the company’s stage of development. The further the company has progressed along the development pathway, the lower the company's risk and the higher its value. Here’s an example of a valuation-by-stage model:

Estimated Company Value,   Stage of Development
$250,000 - $500,000,  The business idea or business plan exists
$500,000 - $1 million,  The management team is in place to execute the plan
$1 million – $2 million,  A final product or technology prototype has been developed
$2 million – $5 million,  Strategic alliances, partners or customers are in place
$5 million and up,  Revenue growth and a pathway to profitability is imminent


Click here to learn more about business valuations


One of my favorite stories about resources


In 1971, Frederick Smith founded the company with $4 million of inheritance and $80 million in loans and equity investments. FedEx started out with eight planes, covering 35 cities, and it had plans to add more each month.

But in the first two years, primarily due to rising fuel costs, the company found itself millions of dollars in debt and on the brink of bankruptcy.

When FedEx's funds dwindled to just $5,000, Smith realized he didn't have enough to fuel the planes. The company had already gone to many extremes, from pilots using their personal credit cards to fuel planes to uncashed paychecks.

So what's a desperate founder to do? Smith impulsively flew to Las Vegas and played blackjack with the last of the company money.

Amazingly, when he came back the next week, he had turned the remaining $5,000 into $27,000 — just enough for the company to stay in operation for another week.

The $27,000 wasn't the solution to all of their problems, but Smith viewed it as a hopeful sign that things would go up from there. He used the money as motivation to obtain more funding, and eventually raised another $11 million.

FedEx, the world's first overnight delivery company, delivers more than 1.2 billion packages every year in over 220 countries.



Are you looking for investors for your business, contact us today, funding@omegaaccelerator.com.  



Are you interested in angel investing and helping us fund early-stage businesses? Email info@OmegaAccelerator.com



Sources and Links

https://www.businessinsider.com/fedex-saved-from-bankruptcy-with-blackjack-winnings-2014-7
https://techcrunch.com/2017/08/23/does-it-really-matter-how-much-your-startup-raises/
http://blog.gust.com/8-tips-on-how-much-money-to-ask-for-from-investors/
https://www.biblegateway.com/passage/?search=1+Samuel+17&version=NIV
https://rencarlton.blogspot.com/2020/02/superbowl-2020-angel-investors-valuing.html
https://www.linkedin.com/in/rencarlton
https://rencarlton.blogspot.com
https://twitter.com/RenCarlton
https://www.youtube.com/channel/UCmxQWgUDlPJo0IHCIa6SzrQ
https://omegalegacyacceleratorx.com/924-2/https://www.facebook.com/TheOmegaAccelerator/
https://www.instagram.com/omega.funding/
https://rencarlton.blogspot.com/2019/09/funding-session-with-ren-carlton.html


Disclaimer: This does not constitute an offer to sell, a solicitation of an offer to buy, or a recommendation of any security or any other product or service. We are not offering any legal, investment, tax, or medical advice. Please consult the appropriate professional before doing anything you learn from the content posted on any of our digital properties. All stories are based on true events, but are altered to protect the identity of the individuals involved.

Thursday, May 14, 2020

How to Turn $5,000 Into $4 Million, the First Three Rules of Angel Investing - Questions and Answers - Ren Cartlon

What is Angel Investing?


Providing Capital for a Business Start-up



When did Angel Investing Become Available to Most Investors?


Title III of the Jumpstart Our Business Startups Act (JOBS) finally entered into force on May 16, 2016. 



Why Should I Care About Angel Investing?


If the first three rules of real estate are location, location, location. The first three rules of angel investing are returns, returns, returns. Angel investing offer high risk, high reward potential opportunities.

Targeted Returns: 2.5X in four years, roughly 25% annually.

Which is worse, risk of loss or risk of missing opportunities?
Example: If you invest $5,000 and let it sit untouched for 30 years, here are some possible scenarios:
-Bank, 1% = $6,739
-CDs, Money Markets, Bonds, 5% = $21,610
-S&P 500, Large Cap Stocks, 10% = $87,000
-Real Estate, 15% = $331,000
-Angel Investments, 25% = $4 million



Who Else Cares About Angel Investing?


Jeff Bezos, founder of Amazon, made a $250,000 investment in Google in 1998. It was worth $1.6 billion in 2019



Where Can I Angel Invest? 


Equity Crowdfunding Portals
Private Placements
Business Accelerators and Syndicates



Are There Any Other Success Stories?


$10,000 investment in Uber in 2010 was worth $127 million in 2015
$100 investment in Bitcoin in 2010 was worth $28 million in 2017




Are you looking for investors for your business, contact us today, funding@omegaaccelerator.com.  


Are you interested in angel investing and helping us fund early-stage businesses? Email info@OmegaAccelerator.com


Sources and Links
https://rencarlton.blogspot.com/2020/04/hunting-unicorns-angel-investing-vs.html
https://metrostart.org/blog/2016/07/11/260-return-on-startup-investments/
https://techcrunch.com/2012/10/13/angel-investors-make-2-5x-returns-overall/
https://www.linkedin.com/in/rencarlton
https://rencarlton.blogspot.com
https://twitter.com/RenCarlton
https://www.youtube.com/channel/UCmxQWgUDlPJo0IHCIa6SzrQ
https://omegalegacyacceleratorx.com/924-2/https://www.facebook.com/TheOmegaAccelerator/
https://www.instagram.com/omega.funding/
https://rencarlton.blogspot.com/2019/09/funding-session-with-ren-carlton.html


Disclaimer: This does not constitute an offer to sell, a solicitation of an offer to buy, or a recommendation of any security or any other product or service. We are not offering any legal, investment, tax, or medical advice. Please consult the appropriate professional before doing anything you learn from the content posted on any of our digital properties. All stories are based on true events, but are likely altered to protect the identity of the parties involved. The above figures are possibly estimates based on assumptions that may be proven to be inaccurate or subject to change.

Tuesday, May 12, 2020

The Fourth Powerful Secret to Battling Giant Competitors - Speed - How Startups can Competing Against FAANG - Facebook, Amazon, Apple, Netflix, Alphabet Google - David vs. Goliath


This is part four of a series we are doing on David vs. Goliath and battling giants. I will talk about how startups can compete against the FAANG companies and other major, well-funded, legacy competitors. The FAANG are Facebook FB, Amazon AMZN, Apple AAP, Netflix NFLX; and Alphabet/Google GOOG.

Click here for part 1
Click here for part 2
Click here for part 3

"A good plan violently executed now is better than a perfect plan executed next week."

George S. Patton

The Fourth Powerful Secret to Battling Giant Competitors - Speed


"He (Goliath) had a bronze helmet on his head and wore a coat of scale armor of bronze weighing five thousand shekels (about 125 pounds or about 58 kilograms); on his legs he wore bronze greaves, and a bronze javelin was slung on his back. His spear shaft was like a weaver’s rod, and its iron point weighed six hundred shekels (about 15 pounds or about 6.9 kilograms.)

Saul dressed David in his own tunic. He put a coat of armor on him and a bronze helmet on his head. David fastened on his sword over the tunic and tried walking around, because he was not used to them. “I cannot go in these,” he said to Saul, “because I am not used to them.” So he took them off. Then he took his staff in his hand, chose five smooth stones from the stream, put them in the pouch of his shepherd’s bag and, with his sling in his hand, approached the Philistine.

Samuel 17

David was small, fast, and not weighed down by heavy armor or weapons. Goliath was large, slow and carrying a lot of weight.


This is my favorite way to compete with large companies. Speed is a huge advantage when battling giant, large competitors. Startups can launch a business concept the day the founders hear about it. No approvals, meetings, bureaucracy, or oversight. You can just do it!

How to Grow Your Business Fast

-Outsource and hire - Make a list of the roles you need and focus on filling them as quickly as possible.
-Focus on driving cash - Build systems and process that keep cash flowing in. No cash = no business. Investment dollars, loans, or revenue can meet this requirement.
-Be ready to pivot - Don't fall in love with any ideas until you found a winning formula. Giants have the resources and time to over-commit to bad ideas. You must change early and often until you find the winning formula. YouTube was a video dating site. Twitter was a podcasting network. Flickr was an online role-playing game.
-Establish meaningful milestones - Meaningful means milestones that will either attract investors or create revenue. It's tough to grow when you do not have a target. Picture bowling blindfolded. Tough to hit the target (bowling pins) when you do not know where to aim.
-Manage risks - Create situations where you have unlimited upside and minimal downside. That way if a situation is under-performing you do not need to worry about abandoning it for better opportunities.
-Focus on win-win situations - When you create win-win situations, everyone has incentives to keep making progress

One of My Favorite Stories About Speed

Kevin Systrom and Mike Krieger founded Instagram in a San Francisco co-working space in 2010. With only 13 employees, Instagram grew to 30 million users by 2012. Instagram was acquired by Facebook in 2012 for approximately $1 billion in cash and stock. Now that is fast!


Are you looking for investors for your business, contact us today, funding@omegaaccelerator.com.  


Are you interested in angel investing and helping us fund early-stage businesses? Email info@OmegaAccelerator.com


Sources and Links
https://www.washingtonpost.com/news/innovations/wp/2015/07/02/the-7-greatest-pivots-in-tech-history/
https://www.biblegateway.com/passage/?search=1+Samuel+17&version=NIV
https://en.wikipedia.org/wiki/Timeline_of_Instagram
https://www.inc.com/business-insider/companies-startups-unicorn-1-billion-valuation-record-time.html
https://www.forbes.com/sites/forbescommunicationscouncil/2018/07/19/how-to-build-your-dream-team-and-grow-your-company-fast/#664e1cf54845
https://www.businessnewsdaily.com/7690-rapid-business-growth-tips.html
https://rencarlton.blogspot.com
https://twitter.com/RenCarlton
https://www.youtube.com/channel/UCmxQWgUDlPJo0IHCIa6SzrQ
https://omegalegacyacceleratorx.com/924-2/https://www.facebook.com/TheOmegaAccelerator/
https://www.instagram.com/omega.funding/
https://rencarlton.blogspot.com/2019/09/funding-session-with-ren-carlton.html


Disclaimer: This does not constitute an offer to sell, a solicitation of an offer to buy, or a recommendation of any security or any other product or service. We are not offering any legal, investment, tax, or medical advice. Please consult the appropriate professional before doing anything you learn from the content posted on any of our digital properties. All stories are based on true events, but are altered to protect the identity of the individuals involved.

Thursday, May 7, 2020

Hunting Unicorns - Investing in the Right Founders - Bet on the Jockey, Not on the Horse - Ren Cartlon


When it comes to investing in startups, it is all about the founders

There is a saying, bet the jockey, not the horse

What founders do to encourage our investments, and what others do that scare us away

  • Impatient vs. Patient 
  • Arrogance vs. Confident 
  • Difficult vs. Cooperative 
  • Annoying vs. Responsive
  • Scattered vs. Focused
  • Evasive vs. Direct
  • Shady vs. Honest
  • Unprofessional vs. Impressive
  • Rude vs. Polite
  • No Personal Financial Investment vs. Committed 
  • Entitled vs. Grateful

Are you looking for investors for your business, contact us today, funding@omegaaccelerator.com.  


Are you interested in angel investing and helping us fund early-stage businesses? Email info@OmegaAccelerator.com


Sources and Links
https://www.linkedin.com/in/rencarlton
https://rencarlton.blogspot.com
https://twitter.com/RenCarlton
https://www.youtube.com/channel/UCmxQWgUDlPJo0IHCIa6SzrQ
https://omegalegacyacceleratorx.com/924-2/https://www.facebook.com/TheOmegaAccelerator/
https://www.instagram.com/omega.funding/
https://rencarlton.blogspot.com/2019/09/funding-session-with-ren-carlton.html


Disclaimer: This does not constitute an offer to sell, a solicitation of an offer to buy, or a recommendation of any security or any other product or service. We are not offering any legal, investment, tax, or medical advice. Please consult the appropriate professional before doing anything 

Tuesday, May 5, 2020

The Third Powerful Secret to Battling Giant Competitors - Vision - How Startups can Competing Against FAANG - Facebook, Amazon, Apple, Netflix, Alphabet Google - David vs. Goliath

This is part three of a series we are doing on David vs. Goliath and battling giants. I will talk about how startups can compete against the FAANG companies and other major, well-funded, legacy competitors. The FAANG are Facebook FB, Amazon AMZN, Apple AAP, Netflix NFLX; and Alphabet/Google GOOG.

Click here for part 1
Click here for part 2

The Third Powerful Secret to Battling Giant Competitors - Vision

The Philistines declare war on the Israelites and wrench the Arch of the Alliance from them. David was not born into royalty. He entered life as a humble shepherd, rose to found a dynasty, and became a central figure in Judaism, Christianity, and Islam.

Samuel the prophet had informed David that God had chosen him to be the next king of Israel and anointed him with his brothers around him (1 Samuel 16:13). David knew this information when he arrived in the camp and heard Goliath’s sneering rants. And he drew additional confidence by remembering how God had helped him in the past (1 Samuel 17:34–36).

As Israel's second king, David built a small empire. He conquered Jerusalem, which he made Israel's political and religious centre. He defeated the Philistines (Goliath was a Philistine) so thoroughly that they never seriously threatened the Israelites' security again, and he annexed the coastal region.

David's vision was to be King of Israel. What is your vision?


Building Your Vision 

Your vision for your company should be exciting and motivating. One way to do this is to use your business that solves a problem or reaches a goal that is meaningful to you. If you can do this, the bare minimum outcome of success will be doing something that benefits you. If it benefits you, it is likely to benefit others as well.

Adopting this methodology avoids the challenge of developing a solution looking that is looking for a problem. This is one of the problems we see in some of the pitches we receive. Start with the problem and find a solution.

By having a concise vision of what you want your business to become, you will be in an improved position to work toward that goal. Do not make goals that are overly broad, such as "I want to make a lot of money." Instead, aim toward something like "I want to add three new customers a month" or "I want to see a rise in my search each week." As you establish measurable objectives, it is possible to view your progress. Also, it will make you more confident.

Examples of Famous Clear, Concise Visions

“Give me liberty or give me death.”
– Patrick Henry, United States Revolutionary War leader, 1776

“We shall never surrender.”
– Winston Churchill, England prime minister, 1941

“By the end of the decade, we will put a man on the moon.”
– John F. Kennedy, United States president, 1962

“A computer on every desk and in every home.”
– Bill Gates, Microsoft chairman and chief executive officer, 1980

One of My Favorite Story About Vision

Alexis Ohanian and Steve Huffman launched Reddit in 2005 as a social website that allows users to post thoughts or content and have others rank submissions by voting it up or down. Soon after, they flew to meet with Yahoo executives in Sunnyvale. Upon hearing that Reddit had about 10,000 users at the time, one executive sneered, “You guys are just a rounding error compared to Yahoo. What are you guys even doing here?”

“The first thing I did when I got back to my desk, I put this on my wall, ‘You are a rounding error,’ because I wanted to know every single morning who we were proving wrong,” Ohanian said.

As of 2018 Reddit has 330 Million Monthly Active Users.


Are you looking for investors for your business, contact us today, funding@omegaaccelerator.com.  


Are you interested in angel investing and helping us fund early-stage businesses? Email info@OmegaAccelerator.com


Sources and Links
https://www.britannica.com/biography/David
https://www.desiringgod.org/articles/where-real-courage-comes-from
https://www.nationalgeographic.com/culture/people-in-the-bible/story-king-david-goliath/#close
https://www.imdb.com/title/tt0054788/plotsummary
https://en.wikipedia.org/wiki/Goliath
https://www.reliableplant.com/Read/2432/power-of-a-clear,-concise-vision
https://www.inc.com/murray-newlands/6-tips-to-build-self-confidence-for-business-success.html
https://www.ocregister.com/2014/01/28/status-update-reddits-ohanian-motivated-by-rounding-error/
https://rencarlton.blogspot.com
https://twitter.com/RenCarlton
https://www.youtube.com/channel/UCmxQWgUDlPJo0IHCIa6SzrQ
https://omegalegacyacceleratorx.com/924-2/https://www.facebook.com/TheOmegaAccelerator/
https://www.instagram.com/omega.funding/
https://rencarlton.blogspot.com/2019/09/funding-session-with-ren-carlton.html


Disclaimer: This does not constitute an offer to sell, a solicitation of an offer to buy, or a recommendation of any security or any other product or service. We are not offering any legal, investment, tax, or medical advice. Please consult the appropriate professional before doing anything you learn from the content posted on any of our digital properties. All stories are based on true events, but are altered to protect the identity of the individuals involved.

Friday, May 1, 2020

Angel Investors - How Much Money Does a Startup Need to Launch or Grow? - Use of Funds - Ren Carlton

I was messaging a friend of mine earlier this week about launching a new business. When I asked her how much money she thought we needed she said:

"We can each invest a max of $500 each, as partners, and make a prototype, then we can both apply for further business grants or angel investors."

A bit shocked by her response, I turned to the internet for further guidance. When I googled "how much money does a startup need", this was the first result: 

"Estimate your costs. According to the U.S. Small Business Administration, most microbusinesses cost around $3,000, while most home-based franchises cost $2,000 to $5,000 to start."


How Much Money Does a Startup Need?


Most technology startups, raising outside funding is a necessary step in the process of building a viable business. Not every business needs to be a technology company, but most of the businesses we see have some component of technology.

Most companies that reach a Series A round of funding Raise between $25,000 - $500,000.

That is a pretty wide range. Let's take a deeper look.


Common Startup Costs


Here are some common startup costs they may have:
-Office space
-Equipment and supplies
-Communications
-Utilities
-Licenses and permits
-Insurance
-Lawyer and accountant
-Inventory
-Employee salaries
-Advertising and marketing
-Market research
-Printed marketing materials
-Making a website


Make sure to add any other expenses that are unique to the business.

Stage

This is probably the biggest factor. Idea and prototype stage companies may have very lower costs, where a business that is producing and growing may have to support a full team, inventory, etc.

How Are You Going to Pay Your Bills?

One of my favorite questions I ask founder is "How are you going to pay your bills?
Almost everyone gets caught off guard. I am not sure why. When evaluating an angel investment, I want to make sure the founders are thinking through everything. 



Are you looking for investors for your business, contact us today, funding@omegaaccelerator.com.  


Are you interested in angel investing and helping us fund early-stage businesses? Email info@OmegaAccelerator.com


Sources and Links
https://techcrunch.com/2017/08/23/does-it-really-matter-how-much-your-startup-raises/
https://www.sba.gov/business-guide/plan-your-business/calculate-your-startup-costs#section-header-10
https://rencarlton.blogspot.com
https://twitter.com/RenCarlton
https://www.youtube.com/channel/UCmxQWgUDlPJo0IHCIa6SzrQ
https://omegalegacyacceleratorx.com/924-2/https://www.facebook.com/TheOmegaAccelerator/
https://www.instagram.com/omega.funding/
https://rencarlton.blogspot.com/2019/09/funding-session-with-ren-carlton.html


Disclaimer: This does not constitute an offer to sell, a solicitation of an offer to buy, or a recommendation of any security or any other product or service. We are not offering any legal, investment, tax, or medical advice. Please consult the appropriate professional before doing anything you learn from the content posted on any of our digital properties. All stories are based on true events, but are altered to protect the identity of the individuals involved.