Noubar Afeyan (serial entrepreneur and Managing Director of Flagship Ventures) gave precious pieces of advice in his last class of New Enterprises:
- Cynism is very negative in a startup. It is very easy to be cynic when there is uncertainty, when you make up the price of your service/product, when the first customer calls, or when you make fun of the logo, to name a few. Startups are heaven for cynic people. "But start laughing about things you do and the startup is dead."
- Never provide a premoney valuation in early discussions with investors. If the VCs ask you, tell them "let's have the discussion when you are ready to commit".
- VC people are waiting for a reason to say NO. Don't give them the reason.
- In startups you just have to do things NOW and not SOON. If the competion does it now and you do it soon, you are out.
Noubar also talked about typical salaries of the management in a startup in a post round A or B of financing (which sounded surprisingly high):
- CFO: $180K-$250K
- VP R&D $160K-$240K
- CEO $200K-$350K
(ps. Noubar experience is mainly in biotech and he was talking about very senior external management that you bring to the company, not the founders)
Finally, when asked again how much funding startups should raise, he repeated "CASH IS KEY, CASH IS KING: it is counterintuitive but having a lot of funding attracts talent".
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