March 19, 2014 - Enormous changes are afoot in the C-suite at companies at every level of scale and growth. We built Bowery Capital on the thesis that roughly $357 billion would change hands over the next ten years through the swapping out of old technology for new. This perspective comes from years of seeing internet natives becoming IT decision-makers, a concept on the rise, but this is something we are just at the beginning of. Greylock’s David Sze recently talked about finding companies to invest in that access the "$140 billion of IT spend up for grabs." We not only agree, but see the number as far higher. More specifically, we think we are only in the 1st or 2nd inning of this shift.
March 18, 2014 - Recently, I happened to be the third wheel of a conversation between two active angel investors who were talking about a particular company that was closing a round of funding (names will remain anonymous to protect the innocent). I was somewhat familiar with the company but not intimately; thus, I was able to listen to the debate –er, conversation – with a completely open mind.
March 18, 2014 - In this three part series, I will focus on the nuances of venture debt when applied to life science companies. Up first, the “black box” of life science lending–insight for companies and investors about what happens internally once the typical due diligence package is received. Next, in Part 2, I’ll cover how debt can add value, with a focus on biotech/pharma, medical devices and diagnostics/tools.The last installment, Part 3, will focus on the potential downside(s) to debt, and situations that are best funded by equity.
March 5, 2014 - Many entrepreneurs have heard horror stories about taking on venture debt. Whether a lender fell asleep at the wheel, a borrower painted too rosy a picture about operating progress, and/or an investor had a change of heart, these horror stories tend to end the same way – with a lender sweeping cash, a borrower unexpectedly ceasing operations, vendors taking legal action, and Board members vowing never to do another venture debt deal.
March 5, 2014 - Put simply, hedging is an exchange rate risk management strategy to protect against changes in foreign exchange rates. A lot of companies will only look to discuss hedging after foreign exchange rate movements have moved against them, hurting their bottom line. Understanding a few hedging basics may help your company get ahead of the game in deciding when to consider using hedging mechanisms, so you don’t have to find out for yourself.
March 5, 2014 - As a banker, I’ve spent far too much time in the weeds of Excel financial models for startup companies. Startup finance is not always the most fascinating work, and many founder CEOs are technologists who have no interest or experience with the “numbers” side of a startup. Yet, there are some very basic “Startup Finance” concepts that I think are imperative for entrepreneurial execs to grasp as they grow their businesses. Don’t worry, I’m not suggesting you understand all the inner workings of QuickBooks or GAAP revenue recognition – here are two key areas that will be crucial in growing your venture.