Andrew Romans is the co-founder and general partner of Rubicon Venture Capital, a venture capital fund that invests in privately held technology companies and enables its investors to co-invest along side the fund on a deal-by-deal basis via innovative sidecar funds right up to IPO or M&A exit.

List of Contributors and Interviewees xiForeword by André Jaeggi xiiiIntroduction 11 Start Me Up! 3Why Now Is a Great Time to Start a Company, Be a Venture Capitalist, Be an Angel Investor, or Invest in a VC Fund 3BranchOut: The Textbook Case Study for Superb Angel Advisory Round and VC Funding 7Add Angel Dignitaries to Your Series A VC Round 10Why Entrepreneurship Is Becoming Increasingly Important and Why Angel Investing and Venture Capital Are Here to Stay 11Getting Started 12We've Got to Start a Company 13When to Start Up? 142 Angels, Mortals, and Super Angels 17The "Startup Cambrian Explosion" 18Ron Conway, Super Angel 20Accelerators 22Tech Stars and the Rise of Accelerators 24Online Funding Resources 28Crowdfunding: Everything You Always Wanted to Know but Were Afraid to Ask 28Practical Ideas and Advice on Raising Angel Funding 35How to Recruit and Negotiate with Advisors 37Convertible Note Versus Priced Round 37Valuation Ranges for Pre-Money Caps on Seed-StageConvertible Note Financings 40Don't Raise Angel Funding at Too High a Valuation 41Raising Angel Funding 41Steve Jobs Rated by His VC 43The Team Means Everything 44A Balanced Team 44Recruit a First-Class Team Contingent upon Funding 51Choose Your Investors Wisely 52Building Blocks of Pre-Money Valuations 53Pitch Lawyers before Pitching Angels 53Legal Fees for Startups: Fixed Pricing 55Legal Factors to Consider When Choosing an Angel Investor 56Smart Angels Flock Together 57Pledge Funds 58The Importance and Art of Networking 58Never Turn Down a Smart Strategic Investor 593 How Venture Capital Works 61Understanding VC Titles 66To the Victor the Spoils 67The Stock Market and Venture Capital 69Where Do VCs Get Their Money? 69Why Are VCs So Arrogant? 71Old School Venture Capital: Pitch Johnson on the Early Days of Silicon Valley 72Romans Five Forces Venture Model: Incentives Are Not Aligned 77Corporate VCs 79Family Offices 80The Difference between Venture Capital and Private Equity 81A Perspective on the Difference between VC and PE 83What About Venture Debt? 85This Is Not Your Mother's Venture Debt 86Pick the Right Partner the First Time 89Questions You Should Ask Your Venture Debt Partner 90Venture Debt Terminology and Term Sheets Revealed 91Why Venture Debt Is an Attractive Asset Class 95Fund of Funds 96More Than Matchmakers Between GPs and End Investors 974 What to Bring to the Dog and Pony Show! 103Business Plans 103Executive Summary 105Investor Slide Deck 105Financial Model 106Characteristics of the Best Spreadsheet Models 109Investor Control Schedule 114Demo and Video 115The Pitch 116Five VCs Explain What They Really Think About Your Pitches 1185 Practical Ideas and Advice on Raising VC Funding 121How Should an Entrepreneur Approach Negotiation of the Key Terms? 123How to Negotiate with a Venture Capitalist 124Don't Tell VCs Which Other VCs You Are Talking To 127Confidentiality: No NDAs or Secrets in the Fast Lane 128Bridge Financing 129Living from Round to Round 129Employ an Army of Interns 130Customer Financing 130Dual Tracking 132Venture Fratricide 1326 Corporate Governance: Who's The Boss? 135The VC That Wanted a Board Seat 136Engaging the Board of Directors 140Making Your Board Work for You 1467 Company Building and Growing Value 149Distribution Versus Product 149Skype: Where is Your Button on Kazaa? 150Facebook: The Balance Among Product, End User Experience, and Advertising 151MySpace: Pimp Out Your Contacts 153YouTube: How to Extend Beyond Your Domain 156The Marketing Myth 157The Blackmail Business Model 159The Nine-Year Overnight Success 160Just Grab the Bird and Lower Yourself Out of Those Clouds 161How to Come Up with True Innovation That Drives the Rest 162Picking a Name 1638 Which Way to the Exit? 165M&A Is the Most Likely Positive Outcome for Most Entrepreneurs 165Practical Ideas and Advice When Selling Your Companyvia M&A 165Three Kinds of Business Buyers 170How Instagram Secured a $1 Billion Valuation 172Advice on the $300 Million Sale of Adify 173How Liquidation Preferences and Carve Outs Play inExit Scenarios 174How to Smoke Out the Serious VCs in Your Syndicate 175Large Trade Sales of Private, Venture-Backed MedicalDevice Companies 176Acqui-Hire Early Exits: VCs Versus Founders 176Several Perspectives on Acqui-Hires 185Seek Truth in Facts: Statistics on Venture Exits 186Fund Physics: Expect Improved IRRs from Smaller Funds 1889 Do We Need All These Lawyers? 191What Are the Key Terms in a Term Sheet? 192No Time Like Right Now to Settle a Legal Dispute 198Dumb Licensing 200Letting a Licensee Get Out of Control 201Sometimes You Have to Go Downhill to Get to the Top of the Next Hill 202It Is Better to Be Lucky Than Good 20310 Ladder to Liquidity: The Secondary Market 205How Early-Stage Angels and VCs Can Get Their Cash Back Prior to an Exit 205To Sell or Not to Sell: The Secondary Market for Startups 208The Direct Secondary Market: Selling Some of Your Sharesfor Cash Before a Liquidity Event 210Founders' Preferred: Best Structure for Founder Early Liquidity 211Direct Secondary Funds 213When to Take Your Chips off the Table 213The Founders Club Equity Exchange Fund Model 214Afterword 219Acknowledgments 221Index 223