Bubble, bubble, is it trouble?
by Miki SaxonI’ve always worked with startups and young companies. I lived in the Bay Area during the dot com frenzy, when every cab driver had a business plan, so I thought I’d pretty much heard it all.
But times are hot and entrepreneurs are once again on a roll.
I’m not sure that this qualifies as new or just deja vu, but I had a fascinating call this week from a reader who’s currently talking with investors and had somehow heard that we were looking for beta customers for our new (as yet unnamed) software product that
- guarantees fairness when giving out stock options, so employees love it;
- predicts dilution, so investors love it;
- has an audit trail, so governance types love it; and
- eliminates negotiations, supports a “do it right” culture and automatically creates all related reports, so CEOs adore it.
Never look a gift horse in the mouth, so, since we’ll be looking for beta clients shortly, I asked about some basic information that our program needs to work, things such as
- Did he have a staffing plan, i.e., the types of people he needed in the company’s first two years and at what point he would need them.
- Had he identified the key objectives that the company planned to achieve during those two years?
- Etc.
OK, this is all basic business plan stuff, and he said he was talking to investors, so he must have it, right?
Wrong!
He said he hadn’t really had time to lock down all the “details,” but since his funding was coming through in the next week or so he wanted the stock plan to be ready.
Ah huh. I told him it didn’t look like our timelines coincided, but I wished him great success. (I really wish his investors, assuming he actually has some, good luck—they’re going to need it!)
Stay safe and happy, and I’ll see you next week.
