{38} Valuations, Startup Skills & Note Taking
{38} Valuations, Startup Skills & Note Taking
Featuring Alex Iskold, Alex Lieberman, and elvis 🙌
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Valuations: Pre-Seed
Alex Iskold
Raising pre-seed at inflated valuations is terrible.
Day 0 companies should not be valued at $20M. There has been $0 value created.
Founders feel like heroes now, but it takes long time to build & find product market fit and 99% of these will need more capital.
Bad idea!
A pre-seed valuation of $20M is a bad idea. I was tempted to point out edge cases. But if the founders had a big enough previous win to demand such an inflated valuation, they should be bootstrapping.
Overvaluing is setting yourself up for hard times. If your v1 isn’t a home run, and it will likely fall short of lofty expectations, you’ll have a lot of angry people to deal with. Even modest success will feel like a failure. Raising that next round is going to be a problem.
On the other end of the spectrum, founders can’t be bullied into undervaluing their company. Just because you haven’t delivered value doesn’t mean you should be giving away half of everything for a small chunk of cash. If that’s the only option on the table, don’t take it. Find a contracting gig and build on nights and weekends.
Overall, I don’t like pre-seed valuations. There are other options, such as convertible notes, Safe financing documents, and I’ve recently been very intrigued by revenue-based financing. Bootstrapping is an even better option if you can find a way to make it work.
Startup: Skills
Alex Lieberman
I want to be the best at spinning up businesses & finding product-market fit.
Skills I need to crush to get there:
- copywriting
- web design
- human psychology
- audience building
- paid acquisition
- customer discovery
- product developmentWhat's missing?
This is a solid list. If you have some degree of skill in these areas, you can certainly spin up a business. Or you can be exceptional in only a few areas and find co-founders with complementary skills.
One skill I’ve personally lacked that could be added to the list is door-to-door sales. Building an audience and paid acquisition are both great. But in the early days, you must knock on doors and talk to people. In addition to growing your user base and revenue, you learn so much about your product.
Don’t treat customer discovery as a process you do once that gives you marching orders for 5 years. You should always be discovering opportunities to do the most good for the most users.
AI: Note Taking
elvis
ChatGPT is changing how I build things.
- I use it every day
- I mostly use it to generate coding tutorials
- I also use it to fix code
- When it cannot find a direct solution, it can generate hints
- It helps me augment and organize notesIt's really good at all things code.
A lot of ChatGPT use cases aren’t that exciting to me. I still haven’t written a single line of code using an AI tool. But note-taking is a fascinating use case. I’m personally terrible at note-taking. I rely too much on memory. If something is important enough to remember, it’s important enough to prioritize.
The problem with memory is it’s too insular. Just because something from a conversation doesn’t make my personal list of priorities doesn’t mean that it’s not worthwhile. A simple conversation insight could be extremely meaningful to someone else on the team.
If I think about notes more as a collaboration tool, it’s something I’d like to get better at. AI could make note-taking easy. Imagine a Slack integration. At the beginning of every week, ChatGPT could share a condensed list of notes from all discussions happening in all public channels. I’d pay for that.