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To get new startup ideas off the ground, aspiring business owners are faced with many options for funding, including bootstrapping (self-financing) their venture, taking out a short term business loan, or tapping into the boom of cryptocurrency by launching an ICO to raise capital.

An ICO gives companies the funds they need to operate by selling underlying crypto tokens in exchange for another form of cryptocurrency. Short for Initial Coin Offering, this method of raising business capital is allows startups to retain control of their companies and has little regulation, allowing entrepreneurs to see a significant ROI without facing red tape or restrictions.

Still, entrepreneurs should bear in mind potential disadvantages that come with ICOs, specifically that they bear significant risk of failure and can be expensive to launch. Small business owners should carefully consider the advantages and disadvantages that come with using an ICO to raise business capital.

To learn more about using an ICO to fund a new business venture, check out the infographic from Fundera below.

Everything You Need to Know About Using an ICO to Raise Capital:

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Every entrepreneur dreams that their business will be one of the ones that make it big. For a few very lucky start-up founders, this dream has become a reality and their ventures have truly hit the big leagues by earning a coveted spot in the so-called Unicorn Club. This is a very small number of privately held start-ups that are now valued at a billion dollars or more. Many of the big names will be very familiar to you, with household names like Uber, Airbnb, Pinterest, and Reddit all part of this exclusive club.

In this article, we’re going to look at the secrets to billion dollar startup success. What do these companies have in common – and what don’t they? How can another business replicate their success? Keep reading to find out…

What is a Unicorn Startup?

A unicorn is any privately held startup that’s valued at a billion dollars or more by venture capitalists. This term was coined by Aileen Lee, the founder of Cowboy Ventures, back in 2013. She gave the companies this name due to the statistical improbability of a startup becoming a unicorn; at the time she estimated that only 1 in 1,538 venture backed companies would reach these lofty heights. With 90% of tech startups predicted to fail, to hit a billion dollar valuation is a truly extraordinary feat.

It’s worth noting that you’ll probably see some big names that look like they’re missing from the unicorn list – companies like Facebook and Amazon, for instance. These companies are now worth a mindboggling amount of money. Even after Facebook recently lost $123 billion in value overnight, the company is still valued at over $500 billion, whilst Amazon briefly crossed the $1 trillion market value line in September 2018.

However, as both Facebook and Amazon have gone public and sold shares on the stock market, they’re not generally called unicorns anymore. This term only applies to companies that remain privately owned.

How Do Startups Become Unicorns?

Unicorns are becoming increasingly common, with more startups reaching a net worth of $1 billion each year compared to the year before. Often, they are characterised by the following qualities:

1. Rapid Growth

Unicorns often reach their status through practically meteoric growth. Just look at Uber, which is now the world’s most valuable startup. From its humble beginnings in San Francisco in 2009, the ride hailing app has now expanded into 785 cities around the world. In 2015, after just five years in operation, one billion trips had been taken using the app and this number doubled to two billion a mere six months later.

Other well-known unicorn startups, like Slack, have enjoyed a similarly phenomenal growth. They have been identified as the fastest growing SaaS (Software as a Service) business of all time and in their first four years reached an impressive $4 billion valuation. Today, they have 8 million active users every single day.

That isn’t to say that this high growth is an easy feat to achieve. Founders have to be truly committed to their vision and have clear plans for its execution.

Scroll through the chart below to see how long it took startups to become unicorns. Hover over the bars to see the exact time in years, months, and days.

2. Fast Product Development

Early startups often lack the funds and the staff to take their time. As they’re often reliant on a ‘runway’ – how much time they have before investment money runs out -they need to bring their product to market as soon as possible.

That means products need to be built, launched, and updated very quickly. Aiming for a perfect product straight away simply isn’t feasible; instead many companies release versions of their products as they go, allowing them to test and experiment with what works.

3. Strong Management Team

Nowhere is your management team more essential than in a startup. You need a well-rounded and experienced executive team that can handle all the challenges thrown at it, whilst still maintaining the ability to scale quickly. Studies have shown that the leading causes of small business failure are normally related to issues to do with the founding team:

For further information on startup founding teams, take a look at the stats by clicking on the tab below:

4. Flexibility

Pivots and rapid changes in priorities can be part and parcel of startup life. You simply cannot stagnate; businesses need to stay ahead of the game and be willing to give their customers what they want – even if it’s slightly different to what you originally had in mind. Test everything and be prepared to change rapidly. For example, did you know that Flickr originally began as an online role playing game, and Twitter as a podcast search system?

Take a look at the Lean Startup Methodology to see how you can incorporate flexible approaches to product development into your own business.

5. Disruption

Disruptive technologies improve upon and eventually replace existing marketplaces and services. Uber set out to revolutionise the taxi industry, offering an alternative to the status quo, whilst Airbnb has caused huge disruption in the hotel industry.

Although this might the only ingredient for growth, providing a truly transformative product will give you a big advantage.

6. Excellent Product Positioning & Market Fit

It’s easy to get stuck in the trap of making a product you want, only to find that your target market has no interest whatsoever. You need to get your potential customers involved as soon as possible, to make sure the product meets their needs and is something they would want to spend money on. You need to work with early adopters, take their feedback on board, and actively work on a ‘hook’ that makes your product unique, desirable, and indispensable.

For example, Slack gained much of its early renown as an office collaboration and communication tool through pre-release trials to businesses, word of mouth marketing and the clever PR hook of being an “”. Their target market was clear from the get-go – and their immense success reflects this.

The Most Successful & Valuable Unicorns

The 20 biggest unicorn startups have a combined value of nearly $400 billion dollars and represent the top success stories in their industries. This combined figure is higher than the GDP of many countries, with only 28 countries boasting a GDP higher than this. These businesses are some of the most inspirational startups around, including Uber, SpaceX, Airbnb, Pinterest, and Stripe.

Take a look at the following chart to see information about the 20 biggest unicorn startups with the highest value. Simply hover over each company to see further information, including:

  • Country of origin
  • Valuation
  • The time it took to reach unicorn status
  • Sector/industry
  • Select investors

Most Successful Startup Sectors

Startups are more common in certain sectors, and indeed, startups in particular industries are more likely to succeed. For example, Uber and other services paved the way for a surge in on demand companies, whilst other internet powered industries like the eCommerce, Fintech, and software sectors are also popular targets for innovation.

Top 5 Sectors for Unicorn Startups
  1. E-Commerce –14.1% of startups valued at over $1 billion
  2. Internet Software & Services – 13.7% of startups valued at over $1 billion
  3. Fintech – 13.3% of startups valued at over $1 billion
  4. Healthcare & Biotech – 9.4% of startups valued at over $1 billion
  5. On Demand – 7.8% of startups valued at over $1 billion

It’s worth mentioning that 13% of startups fall into ‘other’ sectors, where their particular niche is too small to warrant its own sector in the data.

Take a look at the full breakdown of the sectors unicorn startups fall into below, and compare which sectors see the most success:

Where are Unicorns Founded?

See the map below to see the countries with the highest density of startups worth a billion dollars or more:

The USA has dominated the unicorn rankings for years. Out of the 255 unicorn startups examined in this article, 47% of the companies are based in the United States. China is the next runner-up, with 30% of the current cohort of unicorns founded there.

Unicorn Startups by Country Over Time

We’ve put together the following chart which shows how the number of unicorn startups in each country has risen over time, showing how countries outside the USA are now embracing startup success:

Unicorn Sectors Around the World

Finally, we’ve designed the following map to show both the overall proportion of unicorn startups in each country, and which sector they belong to. The size of each pie chart represents the number of unicorn startups in the country, with the pie then divided into the sectors for each location.

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For entrepreneurs, securing venture capital is a grueling and frustrating process. Even if you have the most promising venture in history, the likelihood of being offered a term sheet is determined by a mysterious series of steps. Until now. Here’s your guide to what happens behind the scenes, when venture capitalists decide whether to invest:

(read it on Medium : The Secret VC Decision Process — Exposed)

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Understanding the Startup Valuation Process (Infographic)

(special thanks to … Redwood Valuation Partners)

Special Thanks to ….

Business Valuation Atlanta

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For entrepreneurs, securing venture capital is a grueling and frustrating process. Even if you have the most promising venture in history, the likelihood of being offered a term sheet is determined by a mysterious series of steps. Until now. Here’s your guide to what happens behind the scenes, when venture capitalists decide whether to invest:

(read it on Medium : The Secret VC Decision Process — Exposed)

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As of today, Amazon says it’s a #1 bestseller ! (and I proudly can wear the badge) – Few feelings are better! Thank you all !! My next book is due out end of summer, and I hope it is even more useful to #entrepreneurs and #startups

#entrepreneurship

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“Don’t be evil”

Google’s iconic corporate credo was long derided as charming idealism invented by naive young founders unconcerned with profits. They were just a little ahead of the curve.

Today, successful companies operate with a different set of rules. An entire generation of companies are using business and technology- not just for generate products and profits — but to make the world a better place.

Even major corporations realize that they have to look beyond traditional profitability, incorporating socially conscious ideals — even social activism — into their corporate values. Corporate culture often is now as important as operating metrics.

Supporting the values and ideals of their customers, vendors, partners and employees is now an essential part of the company’s mission — otherwise these same customers,vendors, partners and employees will abandon the company.

That bedrock business school phrase — the bottom line — is fading as the primary measure of corporate success. Today, it is being replaced by The Triple bottom line (TBL) — consisting of three Ps: Profit, People and Planet.People is a measure socially responsibility. Planet is a measure of environmental responsibility. (ii)

In the Age of Metapreneurship, altruistic goals are at the forefront, as corporations are discovering that doing good is more than just an idealistic afterthought — but rather it is the basis for their core culture, operations and business model.

# # #

From The Age of Metapreneurship: A Journey into the Future of Entrepreneurship

https://www.amazon.com/dp/B071XN4GNS

________________________

i Shlomit Azgad-Tromer, Columbia Law School, on. “The Virtuous Corporation.” The Harvard Law School Forum on Corporate Governance and Financial Regulation The Virtuous Corporation Comments. https://corpgov.law.harvard.edu/2016/10/14/the-virtuous-corporation/.

ii “Triple bottom line.” The Economist. November 17, 2009. http://www.economist.com/node/14301663.

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Entrepreneurs! Here’s a great way to have fun when sitting in meeting with a typical corporate customer, or even some potential investors, advisors and partners.

These meetings are, by design, not  with innovators or visionaries. Half the time, the participants utter the most predictable and inane comments. We see right through their attempts to appear helpful, savvy or superior — but it’s frustrating because you really can’t say anything. Until now.

First, see if you recognize any of these typical comments:

  • “The only problem with that is …”
    (and then they point out the most minor flaws, in order to seem smart)
  • “I don’t get it “
    (sigh. you’ve already dumbed it down to the preschool level)
  • “Let’s set up another meeting … “
    (nothing like putting off actions and decisions for another 3 months)
  • “Send me an email and I’ll introduce you”
    (yeah, when?)
  • “Send me some documentation”
    (you won’t even read a 3 sentence email, and now you want to read documentation?!)
  • “Why anyone would want to … ?”
    (the motto of the tech laggard)
  • “Have you ever heard of ABC competitor? “
    (this is meant to challenge you, but often is used as a way to make the other person feel superior …)
  • “We’re already doing that”
    (they probably weren’t doing anything — but now that you explained it to them …)
  • “Do you know [this important person] ..?”
    (important person, that they know you don’t know)
  • “How is this different than … ?”
  • “Come back when you have: ____”
    (More traction. Better Metrics. More validation, more .. more .)
Play BS Bingo

Now, instead of being frustrated and bored during — you can have some fun during these meetings. Here’s how it works:

  1. Print off a bingo card for every member of your team. Each one is unique and random.
  2. Every time someone in the meeting utters one of these phrases — mark off the box on your card if it appears.
  3. When someone completes a row or column or diagonal -they’ve won.

Shouting out BS Bingo!

Here’s the tricky part. Ordinarily the winner would shout “BS Bingo!” but you don’t want to freak out the non-players in the room. So I suggest you shout out a word or phrase that would seem perfectly normal in almost any meeting:

This way, there’s a 95% chance your exclamation will make sense compared with anything else that is being discussed in that meeting.

Pitch Meeting Bingo

So print off cards for your team right before you go to that pitch meeting or customer meeting — this way you can secretly play the game while enduring predictable comments from non-entrepreneurs.

Have fun!

# # #

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Modern-Day #Entrepreneurship - SoundCloud
(3174 secs long, 20 plays)Play in SoundCloud

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A few years ago, crowdfunding was the latest disruption for startup funding – giving entrepreneurs new options.  Today, the most exciting innovation for startup funding are ICOs – Initial Coin Offerings.  BTxchange puts together a concise but comprehensive “round-up” – in the form of an infographic – of all the major concepts and issues surrounding this new form of funding.  Very valuable:

Initial coin offerings, or ICOs for short, are the latest craze in the cryptocurrency world. Despite being just a couple of years old, ICOs have managed to attract a lot of attention.

Ahead of the data-packed infographic, they write:

It seems that in the past few months every news outlet had something to say about them, both good and bad. Some praise them for enabling startups to receive funds quickly, but some people despise ICOs because of their unregulated and fraudulent nature. However, one thing is for sure; they have revolutionized how projects receive funding.

While no one can argue that ICOs are flawless, a case can be made that they offer more pros than cons. Sure, ICOs have little, if any, regulatory oversight, and their track record is riddled with thefts, frauds, and failures. However, without them, we wouldn’t have Ethereum, the second biggest cryptocurrency right now, as well as numerous other new-technology startups. Judging ICOs based on the failed projects and without acknowledging their advantages creates a false image. After all, even some traditionally funded projects have turned out to be frauds.

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