One day you are eating free lunch, drinking beer after hours and slacking on your company phone. The next day you are handed your walking papers.
Life at a start-up has always been turbulent. As more Unicorns have IPO bids falling flat – Uber, Lyft and Casper – and funding sources drying up, start-up life has grown stormy.
While things may not be as bad as they were at the start of the 2000s, the last quarter of 2019 and the start of 202 has proven challenging. Many of the companies that have sent thousands of employees packing were backed By SoftBank, a Japanese firm which had $100 billion Vision Fund specifically for start-ups.
According to this story in the NY Times, during February 2020, SoftBank reported its Vision Fund and other investments experienced $2 billion in operating losses in the last quarter of 2019. The Times speculates that the pullback in funding will not be as harsh as it was at the start of the 2000s and some companies – particularly those in the tech field – will continue to be lucrative, raise interest and capital.
In some cases, SoftBank was writing checks it couldn’t cash for companies like Zume, a San Francisco start-up that was known for its pizza making robots. The company saw a huge influx in funding from SoftBank, only to have the funding stop. Employees felt they “got screwed” by SoftBank because it didn’t provide additional funding to boost the $375 originally raised, according to CNN Business.
“There’s no doubt that there’s an excess amount of capital in the private markets and that it has been exacerbated by SoftBank’s Vision Fund,” Kathleen Smith, a principal at Renaissance Capital, which manages IPO-focused exchange-traded funds, told CNN.
Because of the size of SoftBank’s VisionFund it was positioned to take risks, but those gambles didn’t always pay off, said David Erickson, a senior fellow in finance at the University of Pennsylvania’s Wharton School in the CNN story. The Vision Fund premise was “ill-conceived from the get-go,” Erickson said in the story.
Companies from different spheres, whether food delivery, mattresses, scooters or cannabis are facing losses in cash and employees. Airbnb and Door Dash were expected to go public this year, but both are losing money. Cannabis start-ups will be weeded out as many are not expected to survive the year.
The NY Times cited data from PitchBook, which stated more than 300 cannabis firms had raised $2.6 billion in venture capital during 2019 only to have investors take a second look. With investors doubting cannabis companies could deliver the goods legally, funding dried up and staffs were cut back.
Meanwhile, many employees who once were drinking the start-up cool aid are now leery to work for the companies, which offer perks galore one day only to slash staff the next.
Win over investors immediately with a great 1st impression
(FINANCE) First impressions are everything, and it’s no different when it comes to approaching investors. We have the tips to win them over.
Going in for your first pitch meeting with investors can be nerve-wracking – especially if you haven’t yet met these investors in person. Fortunately, if you land a solid first impression, you can set the right tone for the meeting, and make the rest of the presentation a little easier on yourself.
But why are first impressions so important, and how can you ensure you make one?
Let’s start with a recap of the benefits of a strong first impression:
- A reputation framework. Our brains are wired to make quick judgments about our surroundings. Accordingly, we tend to judge people based on our first interactions with them, with little opportunity to change those initial judgments later on. If you strike investors as a smart, likeable, and capable person early on, they’ll see your pitch deck in a whole new light.
- Memorability. First impressions stick with people. If yours stands out from the other entrepreneurs pitching these investors, they’ll be more likely to remember you, specifically, and therefore may be more likely to eventually fund your project.
- Personal confidence. If you know you’ve nailed the first impression, you’ll feel more confident, and as you already likely know, confidence makes you a better public speaker. You’ll speak more deliberately, more passionately, and with fewer mistakes.
So how can you make sure you land this impression?
- Arrive in a nice vehicle. Show up in a luxury vehicle, or at least one that’s been recently detailed, sends a message that you’re already successful. This isn’t a strict necessity, but it can speak volumes about what you’ve already achieved, and how you might look when you drive to meet your future clients.
- Dress for the occasion. Along similar lines, you’ll want to dress nicely. You don’t need to have ridiculously expensive clothes, but you should wear standard business attire that fits you properly and has no signs of wear. It’s also a good idea to get a haircut, shave, wear tasteful makeup, and make other small touches that improve your overall appearance.
- Smile. Smiling is contagious, and it instantly makes you more likable. Don’t force a grin (or else you’ll look like a robot), but do flash a genuine smile as often as appropriate during the first few minutes you meet your prospective investors.
- Use your investors’ names. When you speak to your investors, try to address them by name as often as possible. People love to hear the sound of their own names, so it might help you win their favor. As an added bonus, it will help you reinforce your association with their name and face, so you eliminate your risk of calling someone by the wrong name later on.
- Warm-up with something personal. It’s tempting to get down to business right away, especially because your investors’ time is limited, but in most cases, it’s better to warm up with something personal—even if it’s only a few lines of a conversation. Tell a funny joke you heard earlier in the day, or share an anecdote about how your morning has been going. It makes you seem more personable and charismatic.
- Find a common link. If you can, try to find something in common with each of your prospective investors. You might comment that you got your tie at the same place they did, or that you use the same type of pen. Look for subtle clues about their personalities, lifestyles, and hobbies, and forge a connection through those channels. People disproportionately like other people like them, so the more commonalities you can find with your prospective investors, the better.
- Watch your posture. Your posture says more about you than you might think. Keep your back straight with your shoulders back, and walk confidently with your hands out of your pockets. This is crucial for projecting confidence (and feeling it internally as well).
If you can land a great first impression, you’ll set the stage for a killer presentation—but don’t think you’re out of the woods yet. You still need to make sure you have a fantastic pitch deck in place, and enough knowledge on your startup idea to handle the toughest investor questions. If this is your first pitch, don’t worry – it does get easier – but the fundamentals are always going to be important.
Follow these 7 steps to get outstanding invoices paid to you ASAP
(FINANCE) For a freelancer, it’s more important than ever to bring up the issue of getting paid on time. Here are 7 tips to get your money.
For many, an awkward topic of conversation revolves around getting paid. Whether asking for a raise or asking to borrow money, people often feeling uncomfortable when talking money.
This is equally, or possibly even more so, true for freelancers who are solely in charge of their finances. Without a system of weekly direct deposit, freelancers have to work overtime to keep their earnings in order.
The issue with this is that clients also have a lot on their plates, and something as simple as a freelancer’s paycheck is common to fall through the cracks. This causes freelancers to have to work friendly reminders into their repertoire.
However, freelancers may not always be knowledgeable of the best ways to keep their finances in check (no pun intended). Below are seven ways to enhance payment methods.
- You have to be willing to make billing a priority. Due to the fact that money is awkward to talk about, as aforementioned, many let this fall by the wayside. The best way to do this is to keep up to date with your invoices and send them as soon as they are done. Making a calendar specific for billing can help with this idea.
- This second bit dates back to when we were young and learning our manners: it is crucial to be polite. Not only is it the right thing to do, but it also increases speed in payment. Using “please” and “thank you” in invoicing emails are said to get you paid 5% faster.
- It is best to try and keep a complicated concept like finance as simple as possible. Make sure you are creating specific due dates. This will help to signify importance of payment.
- Now that virtually anything can be done online, it would make sense to use electronic payment verses an old-school check. Accepting online payments will get a user paid, on average, eight days faster as opposed to a check.
- This is an important notion to keep in mind for any aspect of your business life: be professional. Invoices are often seen by many eyes so it is best to include your business’s logo on said invoice. This has been found to increase chances of being paid on time by 10%.
- Specificity is urged again in the form of transparency. Make sure you are giving detailed descriptions on each invoice so that anyone looking at it knows exactly what you are being paid for. By doing this, you are 15% more likely to be paid on time.
- While you may be invoicing month by month, try to avoid sending on the 30th or 31st. Being that everyone, generally, sends their invoices in on these dates, it takes 10 – 20% longer to be paid. With everyone sending it at the end of the month, it has a tendency to back up payroll.
The most important thing to remember is that while the topic of money may be awkward, it is your money. If you let a few invoices fall behind because you are uncomfortable reminding your client, this has a way of adding up. Be sure to keep on track with your finances to earn what you are working for.
What small business owners need to know about succession planning
(ENTREPRENEUR) We’ve all heard the phrase “You can’t take it with you,” but succession planning provides peace-of-mind when leaving behind personal assets.
Succession planning is a forward-looking strategy to ensure the “next in line” is prepped for what is to come. Within an organization, executives or management create a blueprint in hopes of a seamless transition of operations to “partners, future generations, or successor owners,” as Patrick Hicks, the Head of Legal at Trust & Will, states.
Succession planning can be useful in both professional and personal environments, including handing off entrepreneurial businesses or assets of any value. It’s important to create an Estate Plan for whom you plan to replace you in regard to property ownership.
Hicks says that, “Property rights are the cornerstone of modern society.” Property rights include the authority to determine how a resource is used or disposed of after death. This can include giving in a neighbor, a charity, or the most common choice, your family.
“Giving it all to family is typical but giving it all to non-relatives gets second looks. An estate plan is the manifestation of your wishes. It doesn’t matter if anyone else approves.”
It can come as a shock to hear if your assets are undesired by family- or even worse- if it comes as a surprise to them after a loved one’s death. Some choose not to communicate succession plans during one’s lifetime as it could damage familial relationships, but on the other hand, it could also provide a smoother transition. If an heir does not wish to take on the property, there is a chance for contest or litigation that could reduce the benefits of having a succession plan in the first place.
Another scenario is if your dependents do want a hand in property assets after death, but your wishes are to relinquish it elsewhere. Hicks says, “Typically, children do not have a right to claim their inheritance, unless some special rule applies.”
An example is if you leave behind a minor child or surviving spouse, where in that case, they may be entitled to receive support. This could include at least of share of property if no estate plan was in place. However, the necessary support can also be provided by the dearly departed through life insurance or another means.
“When it comes to estate planning, there are societal norms and bounds,” Hicks says, but ultimately, no matter the wishes, having a succession plan can provide peace-of-mind when thinking of the future.
Business Entrepreneur1 week ago
Entrepreneurs face higher rates of mental illness [part one]
Business Entrepreneur1 week ago
Many entrepreneurs facing mental health issues don’t get help [part two]
Business Marketing4 days ago
The use of offline marketing can still be advantageous in a digital world
Business News3 days ago
How to apply to be on a Board of Directors
Business Finance1 week ago
Follow these 7 steps to get outstanding invoices paid to you ASAP
Opinion Editorials2 days ago
3 reasons to motivate yourself to declutter your workspace (and mind)
Tech News2 weeks ago
Sometimes tech is a sight for sore eyes – others it’s the cause of them
Business Entrepreneur1 day ago
Having client difficulties? Protect yourself with an exit strategy clause