I totally agree with you for the medium term. My challenge right now is that I don't have access to the DNS records and migrating to a new email service will take days/weeks.
Migrating to new email service doesn't take days/weeks, at best a few hours as long as you were prepared with existing email aliases (catch all can help minimize the missing aliases) and configuration and access.
In the short term, you are at the mercy of Google. Next time you want to avoid similar fiasco, when you purchase any service from a vendor, please consider the whole offering from sales to support. If you don't see a quick resolution pathway for situations when shit hits the fan, walk away from those vendors.
Personally, I have never bought or recommended others to purchase any "paid" services from Google. They are incapable of and not setup for providing enterprise level product, service and support.
How long it takes to switch services depends on how long you have your TTL set on your MX records. If he set it to expire after days or weeks, it would take days or weeks to switch services. Usually the default is a much lower value, but there are some legitimate reasons to want a high TTL (It could help mitigate a domain hijacking for example).
I'm not too familiar with Baremetrics. You would need to try both products and decide which one works best for you. We provide an advanced analytics platform for subscription businesses of any size.
Love the idea! Would gladly pay for it if it supported physical product sales. i.e., ability to add COGS, have a gross margin, etc. Correct me if I am wrong but your current iteration is more geared towards SaaS startups.
we started with SaaS, so we currently have the most functionality there. However, we are rapidly building out that kind of support. We already support linking expenses for each sale you make to support basic COGS and will have much more soon.
Can second labaraka - the inventory-holding startup world needs a product like this desperately! To the developers: I included my contact information and a writeup about our fashion brand's pain points in the signup page, and I'd be happy to give feedback about the product at some point - just send me a ping!
thanks! we already have a couple of fashion startups using us that have both seasonal (fixed amount) and ongoing (based on sales) inventory purchasing and replenishment expenses to model. We support a number of basic scenarios like that, but inventory-related modeling is definitely something we're focused on improving. I'll keep an eye our for your message, and also feel free to write me any time at deva@opstarts.com.
Thanks for the response. Will keep an eye out for that functionality. Fyi, would be willing to pay $100-150/month to give my sales team the ability to run scenarios.
And there are costs too if everyone's on their own OS and language, in integration and testing and support if the one guy who wrote some critical piece of code in FORTRAN77 on OpenVMS decides to leave...
I don't think nawitus intended for his statement to refer to his actual work - just the work environment. As an example - everybody writes PHP, but some do it on OS X, some on Ubuntu, some on Win8, etc.
Totally with you. Would love to build out several different cost/revenue models including one completely based on web site visits and paid customer conversion rate. Sprinkle in some correlation with marketing spend and you've got something passable for a B2C company.
One of our local tech mentors here in Des Moines released a free Excel file for these sorts of projections (an accompanying book to explain the models, etc is also available from Amazon).
I haven't used it myself but I know that it has helped quite a few companies work through their financial projections around here. It's at least a decent starting point.
Q: What happens if the startup does well after the safe and doesn't need to raise any money and doesn't have a liquidity event? Are the safe investors stuck with a security which does not derive any economic (e.g., dividends) value and they don't have any control?
This is a high class problem to have! As mentioned above, this seemed to us to be an extreme corner case. To remain simple, we tried not to draft for every scenario (which was hard, believe me - lawyers do this by nature). It may require some patience on the part of the safe holder, but odds are that eventually a company will have a liquidity event.
My company is in one of these corner cases where we haven't converted our debts but still operate with a small, but growing revenue stream. It's possible that I will be able to repay the debts with interest in 2-5 years depending on how well we invest revenues in growth and part-time development. I wonder if it isn't more beneficial for me to have the option of paying back debts from revenues and then use revenues to pay out dividends to shareholders and more beneficial for investors to be able to call on the debt when it comes due if the company has accumulated enough revenues. With a safe, both parties seem to lose leverage over the other. I realize that startups in my situation are probably already a write-off from the investors' perspective, so perhaps it's just cheaper to ignore them, but I could imagine a number of people raising $100K safes ending up with an app that makes $30K per year and investors just get screwed.
EDIT: Below, I mean from the point of view of subjective valuation by investors of the different possible outcomes.
Nobody wants to have debt repaid when a company takes off that you could have had early stock in. (And normally I think that convertible debt doesn't allow such provisions.)
Losing the amount invested (investment going to zero) is really, subjectively, not the "worst case" - because it's money the investors could stand to lose.
Instead, subjectively, the worst case (and related to a common investor fear, FOMO, fear of missing out), is making the original and only seed investment that launches the next Snapchat (or whatever), and then getting failing to own any of it due to something like the company not raising another formal round or otherwise repaying the debt instead. That's subjectively a much worse case, then having an investment go to zero, which is rather expected.
Losing 100% of the investment is the "default" case, not at all worst or unexpected, getting converted into equity at a very small and unsure company is the "good" case, getting converted into the next snapchat or whatever is the amazing lottery-winning case, and losing out on the next snapchat or whatever despite ponying up the cash is the worst possible case that you would kick yourself for forever, subjectively speaking. IMHO.
If people here make lots of seed-stage convertible investments they can say whether this matches their valuations, this is just my opinion.
When they repay the debt, you're not "stuck with none of it" you're stuck with indeed a x>0 portion of the company's value. Strictly speaking, you are just stuck. What escapes you is the upside of an investment that you <did not make>.
The right (but not the obligation) to make that investment on pre-defined terms is the defintion of an "option".
That depends, if you have a portfolio of many companies and you expect that most of them will fail but one will bring huge returns -- and then the one that should bring huge returns turns out to merely repay you 10%, then yes, it's worse.
Clearly I meant from the point of view of a seed-stage investor's subjective valuation of alternatives. Nobody wants to have debt repaid when a company takes off that you could have had early stock in.
The one (only?) thing worse than debt in this case is an option that has CP's for exercise that aren't met. Then, you are truly fucked. I'm not trying to be pedantic, but its the nature of the topic at hand that to make any sense, some precision is required.
That's fair. But precision isn't really required, because it is a huge mistake to think that investors use precision.
It's possible to think that they do, and that they make a choice based on adding up the dollar-value of alternatives, multiplying each by its probability, and summing the results.
If that were the case then two things would be true (among many others):
----------------------------
I
First:
Debt that can be repaid would greatly increase the chances of a landed investment (investment being made in response to pitches), since there are many, many cases in which a small group of people formed into a company can repay an early debt, even if the company ultimately folds. All these cases would detract from the down-side. This would, in theory, tip the investment in the favor of being made. For example, if a company has a story that you might make 15x your money in 2 years, but you believe there is a 1 in 15 chance of this happening, then it should objectively make a big difference whether (or how many) out of the other 14 chances repay your money. If all 15 repay your debt, and 1 in 15 makes 15x, then that's a good investment, slightly beating the alternative places you could park your money. On the other hand if most of the cases end up losing 100% of your investment, that "should" make the investment quite a bit worse. For example if 14 in 15 lose the investmnet and the fifteenth makes 10x in 3 years, then that is not great.
But htis is not how investors actually make their decisions.
No investor will give a seed that has a 8 in 10 chance of being repaid (as debt). Period. They just don't.
Firstly, they are looking for that big, big win. And secondly, they want to skew the probability distribution toward that win.
An investor far prefers: (package 1)
0.0125 probability of massive, huge, breakaway hit: 500x
0.05 probability of HUGE growth: 50x
0.9375 probability of total loss (goes to 0 in 3-7 yrs)
------
0.0125 * 500 + 0.05 * 50 = 8.75x average.
Meaning: if you invest in 67 companies you will get one 500x growth story to woo your next set of LP's with. (1/0.0125 = 67), 1 in 20 of your companies will at least show a 50x growth story, roughly paying for the rest which silently go away within 10 years. If you have a $500M fund you can make 1250 seed-stage investments of $500K. Hopefully you can invest enough Googles with them.
to: (package 2)
0.05 probabibility of total write-off
0.15 probability of small win (e.g. 10% p.a., i.e. debt repaid)
0.459 probability of "failed" i.e. moderate growth (5x)
0.34 probability of successful growth (20x)
0.001 probability of 500x
-----------
0.15 * 1.1 + 0.459 * 5 + 0.34* 20 + 0.001 * 500 = 9.76.
Even though the first sums to an expected value of less than the second one.
Investors aren't trying to go for the second package - i.e. making a shot at a very sure 20x and maybe missing it and making 5x. That's not what they make seeds into, $2.5M companies they can believe in at $125K (20x).
It's just not what they're about.
That is not the story that is interesting to these investors. They would far prefer the first package (as far as I understand) that comes with a bigger shot at the moon, even though this greatly diminishes the overall return. Tons of companies are very close to being worth $2.5M, and not really more, and don't need much money. They're just not that interesting.
----------------------
II
Second:
A second way you can know that this isn't a case is that nobody would even look at an investment like (package 3, hypothetical)
Hypothetical:
0.0001 probability of 75000x
0.9999 unknown result
---------
This sums to at least 0.0001 * 75000 = 7.5x. But what does it mean?
Well, it means investing in something that will grow to 75,000 times its size with a 1/10,000 chance of doing so.
It means somehow onboarding 10,000 people - investing $200K into 10000 companies - that are all saying they will turn it into into let's say a $60B company.
Do you see anyone investing $200K at a $800K valuation into 10,000 nascent companies that are saying they will be $60B companies? And showing very, very little chance of doing so - 1/10,000?
Of course not. The amount of money required to invest in, say, 10,000 such companies is $2B. Taking $50K of it would cost $500M. Some VC's have this.
But do you see any VC's with massive, massive onboarding programs where they are pouring $50K into 10,000 companies, that each give you only 1/10 000th confidence that htye're actually the next Apple or Google?
No. It's just not being done. You can play with the numbers but they show that nobody is summing in this way.
They want a different distribution that they can believe in. They're fearing on missing out on something big. Not trying to play the numbers to make something absolutely extraorbital.
But we were talking about a post that originally wrote: "but in the worst case with the convertible note, the investor gets their money back", i.e. that this would be their 'worst-case scenario'.
But far from it. It is extremely rare for debt to be repaid instead of converting, and even if it did, that would be a terrible outcome (and not in the way the OP meant.) Nobody wants their convertible debt to be repaid! (As debt).
They want the company to grow big, or die trying. Really.
From the documents, it appears that the holder has the option to get money back, or shares in the event of a merger/acquisition. They also have priority rights over shareholders in the event of a dissolution.
So no, they DO derive economic benefits, but it may be a long time coming.
[Edit: this is almost the same as convertible notes. The only difference is that as a debt holder they may be able to force a resolution at maturity, but that is usually to the detriment of the company. But as the preamble says, most angel/VC investors dont actually want to be a debtholder"
> For instance, if the BRCA-related risk assessment for breast or ovarian cancer reports a false positive, it could lead a patient to undergo prophylactic surgery, chemoprevention, intensive screening, or other morbidity-inducing actions, while a false negative could result in a failure to recognize an actual risk that may exist.
I cannot imagine someone getting surgery or chemo solely based on a 23andme heads up warning and without consultation with a specialist physician.
As someone working in medical devices, this dramatic language is extremely frustrating.
That example is a bit severe, but I think the Warfarin compliance example is spot-on. You receive a prescription for a drug, but your magic internet test tells you to take a lower dose, because you're "sensitive". Then you die of an aneurysm because the test was wrong.
People are completely stupid when it comes to medical issues. I heard a woman complaining that she couldn't eat honey because she was allergic to fructose. I work with at least 3 "gluten-sensitive" people (it's pretty unlikely they all have Celiac disease, it's not a big office), because it's a hip thing to do. Hell, didn't Angelina Jolie have a prophylactic double mastectomy?
edit: Since everyone is jumping on the Angelina Jolie example. I don't think her decision was made based on a single spit test. And I think she had doctors advising her. But the amount of publicity it got makes me worry that it could become needlessly popular based on self-diagnosis (like not eating gluten).
>Hell, didn't Angelina Jolie have a prophylactic double mastectomy?
The placement of this in your post seems to imply you think she was being stupid with her decision, or thought it was in some way "hip" to do. She has a family history of breast and ovarian cancer and has a defective gene that made her chances of getting breast cancer 87%. As she's pretty wealthy, I'm going to guess that she has pretty good doctors and didn't make the decision on a whim. Also since it was major surgery I'm going to also assume some doctor saw her at least once before the surgery and s/he didn't just take her word for it that the surgery was in her best interest.
Yes there are plenty of people who don't have a clue when it comes to medical issues, but I'm not sure why you felt the need to lump Jolie in with your other examples.
I don't think she did it to be hip - I'm sure she had many doctors advising her, and she underwent many tests before making her decision. But it was heavily publicised, and it set a dangerous precedent that people with less access to medical resources will send away this $100 test, see "cancer risk", and start pushing for unnecessary surgery.
I mean, it is major surgery. There is a pretty big difference from somebody cutting out gluten from their diet and somebody getting surgery. If I decide one day I'm allergic to gluten, I can stop eating it without consulting a doctor. Similarly, as the sibling comment mentions, if McCarthy thinks vaccines cause autism she can stop getting them for her and her children without consulting a doctor. Sure, maybe some women will start pushing for unnecessary surgery, but they will also have to find a doctor who is willing to accommodate them and perform the surgery in the absence of evidence (or perform it based on a website).
It just doesn't jive with me that they are remotely the same thing. I think Jolie is a particularly poor example here and serves as a distraction for an otherwise decent point.
Very very few people are going to understand what that means for them. Gerd Gigerenzer has a book that's a useful discussion of why presenting risks as percentages is bad.
Just because people don't have an M.D. doesn't make them automatically wrong. The patients that complain about gluten have access to information you do not have. Namely, they are able to experiment with their own diet. When they eat gluten, they feel bad. When they stop, they feel better. Who cares if it's placebo effect? If they feel better not eating gluten, tell them to stop eating gluten and support them in their decision instead of writing them off as part of a dietary fad.
And I certainly hope you have at least done some research on fructose metabolism before writing that woman off as a kook. Even if it is all in her head, you can make her at least happier, if not healthier by suggesting that she also avoid foods with sucrose or monomeric fructose, and substitute them with alternatives such as xylitol, glycerol, maltose, or ordinary glucose corn syrup.
If the patient is ignorant, that is a condition the doctor should be expected to cure. If the patient is stupid, they should find a less arrogant personal physician.
Diagnosing the true cause of someone's "gluten allergy" would allow them to start eating gluten again. Since gluten is pretty much everywhere, I'd say that'd be a nice quality of life improvement.
Or the diagnosis might confirm the patient's suspicions, and they might have to monitor their gluten intake for the rest of their life. Either way, there should be actual evidence available before a definite conclusion is reached.
Low-cost screenings, such as 23&Me mail-in swab tests, elimination diets, or common blood and urine tests are a great way to start building up that objective evidence without first doing harm to your patient's wallet.
The FDA just wants to make sure that 23&Me's tests are accurate, which could actually lead doctors to trust them more rather than replicating them at the patient's expense.
When you receive a Warfarin prescription, you begin very close monitoring that involves daily then weekly then monthly blood tests (for the rest of your life) to determine your dose and monitor the effect of the drug in your body. Someone choosing to take a lower dose because of 23andme results would be blatantly and intentionally disregarding the results of testing and the advice of their Drs. The 23andme result that you may be sensitive to Warfarin is something to mention at the outset of your treatment, and nothing more. Also, taking a lower than therapeutic dose of Warfarin would not cause an aneurysm, but would be more likely to cause a clot.
1) I dont see how 23andme results for Warfarin would in practice negatively effect a patients drug regime.
2) You seem to know very little about Warfarin and should take that into consideration when commenting on issues surrounding it.
Why is Jolie's decision stupid? If she had BRCA mutations she could have had over 50% lifetime risk of breast cancer. Seems like a reasonable step to take.
