Articles by Fred Wilson
Saying NoVery short article with a nice anecdote from Fred about the importance of being focused and saying no.
- M&A Issues: Price
Fred summarizes pricing in M&A: do the work upfront to get to a target price that makes sense to you, your senior team, your investors, and will make sense to the universe of buyers you want to target. Then figure out how to get multiple bidders to the table to get the best price. And make sure you want to sell the business before you go through with all of that. Because getting a great price for your business is not easy and when you've accomplished that, you'll want to be able to say yes comfortably.
- M&A Fundamentals
Fred explains what a merger is vs. what an acquisition is, the two types of payment (cash and stock), and the standard structures (full company purchase vs. asset deal).
- Some Thoughts On Burn Rates
Fred creates an interesting rule of thumb to calculate how much to burn: 1. Calculate how much your company valuation will go up by in the next year (which will be mostly driven by revenue growth) 2. Divide that number by 5
- Grit
This article is a powerful endorsement for the book Grit by Angela Duckworth. Fred states that: • Some people have grit and others don't; for those that do, there are ways to recognize it • Grit is more important than talent in many cases
- MBA Mondays: Revenue Models
Fred crowd-sourced a somewhat exhaustive list of revenue models, and digs into each one with its own article: • Advertising – the service is free to use, marketers pay to reach your users via advertising • Commerce / one-time transaction – sell something to your users, keep some or all of the proceeds • Subscription – charge your users monhtly or annually for the opportunity to use your service • Marketplace / Peer to Peer – connect people together in a network, take a small piece of the activity that ensues • Transaction Processing – settle transactions and take a small piece of the transaction for doing so • Licensing – charge users once upfront for the opportunity to use your technology • Data – sell the data your service generates
- DIY vs Delegate
Fred provides some practical tips on how early-stage founders can get better at delegation, such as: ask investors and other founders for help when you hit 50 team members, and hire a "utility infielder" as your first business hire.
- Planning For Next Year
Fred uses his vantage point of seeing annual planning processes across portfolio companies to provide 6 key tips, covering timelines, collaboration, where strategy adjustments fit in, and how many big bets to make.
- What A CEO Does
While a CEO can do more than these, Fred identifies 3 skills a CEO must do well: 1) Set the overall vision and strategy of the company, and communicate it to all stakeholders 2) Hire and retain the best talent 3) Make sure there is always enough cash in the bank