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Applications Open: The Morpheus, Batch 6 (themorpheus.com)
19 points by sandeepeecs 1294 days ago | 39 comments


9 points by nirajr 1293 days ago | link

Guys, this is Niraj, Co-Founder, GrexIt (http://grexit.com). We were a part of Morpheus, Batch-4, and I thought I'll just note down a few things about our experience with Morpheus:

- Morpheus was one of the reasons the two GrexIt founders stopped what they were doing earlier and got into building a product company. They engaged with us very early (really at the idea stage), provided support and inspiration.

- They worked very actively with us in the first 6 months. They were almost like co-founders. We'd CC the Morpheus team in all discussions about GrexIt, and they'd have a lot of useful things to say.

- They were the first real users of our product. They filed more than 100 very intelligent bugs which is priceless :)

- We made a trip to the US and are setting up operations there - they have been providing a lot of good leads and contacts in the US (and in India too, of course).

- The Morpheus Gang (the group of founders of Morpheus portfolio companies) is an awesome gang to belong to. Its useful and fun.

A few 'negatives':

- You have to part with equity. More than what you'd part with if you go with other funding/advice alternatives probably. But I think we got its worth.

- The Morpheus team can add a lot of value even after active engagement is over. While they do continue to provide support, we'd have to see how much that can be, given a lot of new companies are coming in in the present and forthcoming batches.

- You have to know how to deal with opinionated, intelligent advice in the very early days of building your product. You might or might not want to follow all of that, and its up to your discretion at the end of the day.

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2 points by rick_2047 1293 days ago | link

Yours was a product company so we can safely say they are comfortable with product companies. But one question is, are they comfortable with physical product companies. Suppose a company which has something to sell to manufacturing plants. These companies require more investment than the regular software product companies.

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1 point by guglanisam 1293 days ago | link

@rick: we are comfortable working with all type of technology focued product companies, products can be digital or physical, as long they can work in a capital efficient manner. Few physical product companies from our portfolio are: Phitesla.com, robots-alive.com, Sarga.in. In case you are planning to start a physical business drop me me a note (sATthemorpheusDOTcom)& I can connect you these guys

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2 points by rick_2047 1293 days ago | link

That sounds wonderful. But before I approach you, it would be better to first get my product ready (or at least an MVP, or a PoC... whatever). We are not making this thing to start a company (actually my partner has no idea that I am into startups, he is more like Wozniak, much to my envy. That makes me kind of Jobs, much to his envy). Anyways, none of us are in the position now to take this decision of making a startup as we are just in second year of engineering and do not have the family background to support us if our company fails. We do not have market research nor do we have cost analysis.

Basically we are two people who have started to make their 5th semester "mini-project" in 4th semester.

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2 points by guglanisam 1293 days ago | link

Well if u guys decide to drop out (like jobs & woz), do consider Morpheus. Also I am happy to have a informal chat and share my thoughts on ur ideas, if that could be of any help.

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2 points by rick_2047 1293 days ago | link

An informal chat would be nice. I will drop you a line at your email. Maybe a IM chat or skype? Will set up something

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6 points by vijayanands 1291 days ago | link

I'd presume Sameer is only joking when he hints dropping out :) One absolutely underestimates what all can be done, leveraging college years, if only time is managed right.

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2 points by rick_2047 1291 days ago | link

Interesting point. We are doing exactly that. Converted partners hostel room to a little lab, my room to another lab but that about it. College has no resource I can leverage neither in terms of faculty nor facility.

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5 points by vijaysanand 1291 days ago | link

Faculty and facility are secondary actually. Once graduated you'll realize that there is this pressure to get into the rat race - find a job, earn, earn more, and all that jazz. College days shield you from all those pressures of life.

The ones who do get great faculty - then again, can you ever think that faculty can really help if you are onto something unique? As for facility, a laptop and internet connectivity is all that most need today to get some initial prototypes running :)

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1 point by prateekdayal 1291 days ago | link

> Faculty and facility are secondary actually. Once graduated you'll realize that there is this pressure to get into the rat race - find a job, earn, earn more, and all that jazz. College days shield you from all those pressures of life.

Well said :)

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1 point by rick_2047 1291 days ago | link

As for facility, a laptop and internet connectivity is all that most need today to get some initial prototypes running :)

Web startups are not the only kind of startups. :) We are working on something which requires things like a professional workshop (although I college has this but I cannot use it because of timing issues).

The ones who do get great faculty - then again, can you ever think that faculty can really help if you are onto something unique?

Good faculty would actually help us solve small problems when we are prototyping and could help us by directing us to resources. Like I wanted to learn how to do professional PCBs in Eagle. If someone at my college knew that, it would be a lot of help. Online forums and chatrooms are nice but nothing can beat the access to someone in person.

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2 points by prateekdayal 1291 days ago | link

Why don't you intern at one of the IITs? They have labs and some good profs.

This guy is one of the best in India. I enjoyed every single course and lab under him (and they were not easy)

http://www.iitg.ac.in/ece/nemade.htm

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2 points by rick_2047 1291 days ago | link

You wanna know why? Here is a list

1) We do not have a summer vacation. Our next semester starts around 2 weeks after the the completion of semester exams.

2) We are not allowed to do internship except in 8th sem. You heard it right, I was denied leave for internship in the starting of 4th sem. I went anyways.

3) IIT people will not just let me intern because I said so. They look at pedigree. I am not even in the best university of the state. I never topped my class, I never won a state level competition (though now I do have 2 international and one national paper published).

4) There is no info about whom to approach, but thats just a superficial thing. I can look at the website and decide which college and which professor would be the most interesting.

5) I just plain don't think that they would welcome a couple of students who have just an idea and the willingness to execute it.

I would love for me to be wrong about this. I would love it if I am just a prejudice fool who has misconceptions. Please please say all this is not true.

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5 points by prateekdayal 1290 days ago | link

You really need to chill out a little bit :)

There are a lot of people out there who want to work with smart students/people. No one gives a shit about college. You just think people do. We recently started working with someone over at SupportBee and I don't even know what college he is from or what percentage he got in exams. Just find people like yourself and ignore others.

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1 point by rick_2047 1290 days ago | link

We are talking about the best schools in india and not startups. Start ups are cool. My internship at gridbots taught me that startups don't give a shit anyways. I remember that one of my mentors didn't even remember what college was I from. But I think it would be a bit different when I am applying to people there.

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1 point by luckystrike 1290 days ago | link

  I just plain don't think that they would welcome a couple of students 
  who have just an idea and the willingness to execute it.
You'll never know until you give it a shot. A few of my friends got internships at good places (outside India) just by contacting profs directly, and expressing interest in working with them.

In general, one should avoid having preconceived notions of why something would not work out. Yes, it "could" be difficult but it ain't impossible most of the time.

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1 point by rick_2047 1290 days ago | link

The problem is, we do not want to work with them. We want to work on our project. But then again, that list of email ids in my google docs has been waiting for a long time.

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9 points by sushrutbidwai 1294 days ago | link

With due respect to the morpheus guys but I have never seen a single post from any of the ex-morpheus companies detailing how it helped (or not helped them). Because of this I just dont know what value they bring to table.

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3 points by rick_2047 1294 days ago | link

I was just thinking that we should get some morpehus guys to post a short testimony here. You know, as we are the Indian Entrepreneur Community, they must be interested.

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4 points by guglanisam 1293 days ago | link

Thats a good point. There have a been a few post but not too many. I will find them & share here. Meanwhile here is a question that was posted on Quora. What do people think about The Morpheus business accelerator program? 3 Answers: http://www.quora.com/What-do-people-think-about-The-Morpheus...

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6 points by sushrutbidwai 1293 days ago | link

Some questions -

1. Amount of equity you ask is significantly high for an accelerator. At 9% median valuation you are giving is only 50lacks pre-money. Lot of companies will be ahead of that. Even YC is not that rigid about equity and is happy to take as low as 3% if valuations of the company are justifiable.

2. Who pays for the 2 weeks live-in? I for one will never pay for that from my own pocket. 2 weeks of hotel, food, travel etc is a significant cost in my opinion.

3. Apart from Sameer and Nandini who else is part of the team? Do you have a designer in residence?

4. Who pays for the legal/accountant bills to execute the funding?

5. Do you occupy a board seat?

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9 points by guglanisam 1293 days ago | link

Valid questions but IMHO comparison to US accelerators is not exactly accurate,while the model is similar, conditions are widely different. Building this model in india is very different (& tougher I think). There are factors like: highly evolved early stage ecosystem in US, high number of good angels who regularly invest in 6-9 month old startups, VC industry which actively makes early stage investments, availability of support to accelerators , number of startups who survive vs ones which throw the towel, non-existence of exits options india (we don't have google, FB etc) & more. So return on 5% equity in a startup in India is not same as 5% equity of a representative startup is US. We are very bullish that things will change in India as well & as some of these factors change we would be happy bring down the equity numbers, we have no interest in giving a bad deal to founders. They are most important to us.

5. No we do not take board seat, but we do take a board observer seat. Which gives us the right to attend board meetings & receive info that is shared with the board

4. We are ourselves a bootstrapped accelerator (unlike our counterparts in US), hence it is difficult for us to bear the costs at this point. We are working on changing that in the near future & as things get better, we would love to pay these costs. For now we have worked out a deal with our law firm for providing subsidized support for executing deal formlities. The cost is split between all companies of a batch. For the last two batches companies have paid 10-15 k per company for legal costs, which is paid out of the 5 L investment they receive. The documents are very professionally done & include Shareholders Agreement, Founder Employment Agreement & Founders agreement (optional)

3. Sameer & Nandini are two full time founders of Morpheus & between the two of us we can comfortably do 10 companies a batch & that is the uppper cap per batch. Between us we spend approx 10 hrs per company during the active duration of a Batch. But the most valuable resource of Morpheus is the "Morpheus gang", community of around 60 Morpheus portfolio founders & around 10 domain experts. Combined inteligence / network / experience / support of this community is as (or more) powerful as support provide by Sameer & Nandini. This community is always a available & folks help each other on a daily basis.

We do not have designer in residence. One of the expertise of Nandini is design & there are few good freelance designers we work very closely with. Check out some of the portfolio company websites to get an idea of design quality. We are looking to get a designer on board.

2. Our program & live in are both virtual. We do not expect companies to move base. The interactions take place over skype / Gtalk/ phone / email & we work independently on behalf of the startups. We travel at our cost every month once to the cities in which we have companies in the current batch to spend time with them. During live-in we will travel at our cost to your city.

1. For folks who are looking for a financial investor who can also provide some help - Morpheus is not a good fit. We are not financial investors, help is large part of what we offer. We approach these deals from a value creation prespective & not valuation perspective. If you give Morpheus 9% of your company in return for the value we offer & we can help create enough value that outcome of your company improves by 10% or more, you have got your worth back (paulgraham.com/equity.html)

The value we offer comes as a package of money+help & here is how we think about different components of the package.

- (10-20% of total value) 5 L of investment on extremely friendly terms

- (40-45% of total value) Time spent by Morpheus team. 10-15 hrs a week during first 4 months of intensive engagement period. Post the 4 months we continue to support the company for as long they exist, but it becomes on demand support & is no longer 10-15 hrs a week.

- (40-45% of total value) The Morpheus gang & value it can potentially offer

So the only reason you should consider working with Morpheus is if you see value in the non-monitory aspects of the value we offer. 5 L is just incidental.

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4 points by sushrutbidwai 1292 days ago | link

@sameer ,

I am sure you understand this better than I do but -

When I raise even a small amount with a low valuation as 50lacks, that creates a benchmark for other investors who might be interested. It creates a bottleneck specially when you are looking to raise a round with in 3 months or so. In 3 months valuation can hardly be doubled and hence I am not sure how you can convince a VC to invest 500K with reasonable valuations.

Specially given that early stage investing as it is broken in India and VCs always looking to undervalue companies, what you are doing might make it extremely hard for companies to raise later.

I will be very interested in anecdotes you might have in last 4 years to clear this. As you know YC invests between 2-10% with a median of 5-6% only.

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3 points by adsahay 1292 days ago | link

Comparison to YC is misplaced. YC invests a really low amount of money (don't translate to INR, a haircut is $15 in US). Their value is their network, their mentorship, and branding. Equity and money is the least important factor. I'm sure people would be willing to get into YC without any investment, just because being a YC graduate is like being a Harvard graduate, you get a stamp that you can leverage throughout your life.

By all means DO apply to YC. Between Sameer and me we know a handful of YC companies personally, feel free to connect to them through us to learn more about their experience.

If you are good enough to raise VC money in three months from starting, then your point on low valuation is justified. That means you're already a few months in your journey, have a few lakhs a month revenue and are talking to VCs already. Morpheus programme is for people much earlier in their journey (as early as having a day job and an idea).

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3 points by sushrutbidwai 1292 days ago | link

Comparison to YC is misplaced. YC invests a really low amount of money (don't translate to INR, a haircut is $15 in US).

As per @gugalanisam comment above - value of morpheus is also from mentoring and so on and not via money.

If you are good enough to raise VC money in three months from starting, then your point on low valuation is justified. That means you're already a few months in your journey, have a few lakhs a month revenue and are talking to VCs already. Morpheus programme is for people much earlier in their journey (as early as having a day job and an idea).

Exactly - what morpheus is doing is turning away many potential companies which might be looking for similar accelerators but cant really agree on 50lacks pre-money valuations because either they already have investors on-board or looking to bring in investors on board in short duration or are a bit more ahead down the road. What I would have hoped is far more flexible approach in equity. YC puts up 2%-10% not because they cant ask for 10% or more, but because they understand that if they are not flexible lot of companies might not consider them irrespective of value they bring to table.

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2 points by adsahay 1292 days ago | link

"...morpheus is doing is turning away many potential companies which might be looking for similar accelerators"

Are you basically upset that you're too old for prep-school? Morpheus programme is not for startups at all stages, I've not seen them advertise it that way.

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4 points by rams 1292 days ago | link

"Are you basically upset that you're too old for prep-school? " Boy, talk about attitude !!!

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1 point by abhaga 1289 days ago | link

> Exactly - what morpheus is doing is turning away many potential companies which might be looking for similar accelerators

Isn't knowing when to say no a big part of staying focused in an startup? What is wrong with turning companies down if they don't think they can add value?

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1 point by guglanisam 1292 days ago | link

@sushrut how we about we take this offline / I cn share my thoughts and some interesting info about YC which is not in public domain. Drop me a line if u want to chat up - sATthemorpheusDOTcom

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2 points by luckystrike 1292 days ago | link

  - (10-20% of total value) 5 L of investment on extremely friendly terms
  - (40-45% of total value) Time spent by Morpheus team.
  - (40-45% of total value) The Morpheus gang
Thanks. This comment is really helpful and highlights the honesty & transparency attributes mentioned by Shashank ND in an another comment in this thread.

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5 points by abhaga 1293 days ago | link

>2. Who pays for the 2 weeks live-in? I for one will never pay for that from my own pocket. 2 weeks of hotel, food, travel etc is a significant cost in my opinion.

The 'live-in' is metaphorical :). You are not supposed to actually live in by moving to another city. It is like a trial period for getting to know each other so that you can take a better educated call at the end of it.

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8 points by lalitmangal 1292 days ago | link

Fellow Hackers, this is Lalit, Co-Founder CommonFloor.com. We are from the first batch of Morpheus.

If I look back at my journey from starting CF in 2007; meeting and working with MVP has been a truly transformational landmark - changing our founding team from code producers to Business Plan executers.

I strongly recommend MVP to first time entrepreneurs. It is a validation of what you are hatching and gives you the right thinking framework to run a business. Also, it is remarkably energizing to see other companies in gang and learn from their experience.

The MVP gang consists of a spectrum of folks, from legal guys to valley veterans - there are a lot of practical advantages in being with MVP. Especially the email group, it has been great way to bounce off ideas and get help.

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8 points by shashank 1292 days ago | link

Shashank ND from Practo.com, Morpheus Batch 3 (July 2009) sharing my thoughts on how we are benefiting from being part of the Morpheus Portfolio Companies :

1. Got us focused on the most important things from Day 1, didn't allow us to divert our attention, focus. This alone saved the company.

2. In the initial stages it was great to be pushed as hard as we were by Morpheus, it was great to be held accountable / answerable

3. They added few very good practices, which we continue using in the company even after 1.5 years

4. The initial momentum they added was awesome and critical

5. They added credibility to the company which was especially important for a B2B product and a very young team such as ours

6. Great set of portfolio companies (gang), comprises of companies/entrepreneurs we look up to. Learnt a lot from the gang.

7. Was introduced/met with 4-5 VC's thanks to Morpheus efforts

8. Since Morpheus took care of meeting VC's and updating them about their portfolio companies, we got to continue uninterrupted on building our business

9. Been invited to number of forums, events as speaker thanks to our association with Morpheus

10. One of the most honest, transparent, energetic people I have come across so far

My advice to the young entrepreneurs :

1. Stop worrying about equity. You dont build a big company by having the most equity, you build it by getting the right team, advisors, investors and building value/money. So stop worrying and holding on to equity, start worrying on how you will get to become a big company. Do whatever it takes to become big.

2. Your responsibility as entrepreneurs is to build a successful company. This is a long (7-10 years), hard (1% success rate) & lonely battle, it is absolutely critical to find able & willing shoulders to share this burden with.

According to me, Morpheus is playing an important role in building the young Indian Startup Ecosystem - teaching, mentoring, connecting young startups and saving a few from dying / or going into oblivion. They passionately put in lots of effort, little money & time into their portfolio companies and the entire Indian Startup Ecosystem. We need more of such people and organisations, as I believe they are a critical part of any Startup Ecosystem. Just ask Phani from RedBus.in about the importance of mentorship and you will know where I am coming from.

If anyone needs any more details about Morpheus or their Startup Acceleration Program, you can get in touch with me at shashank[at]naabo[dot]com

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4 points by adsahay 1292 days ago | link

I'm Aditya, founder of Radbox, batch 4 (I think). My association with Sameer goes back to August 2009.

My friends have already pointed out most of the important stuff, so I'll just mention some things not covered:

1. They're mentors. Sameer might slip in something about being like co-founders during the engagement, but that expectation is too high. Think of them as mentors.

2. Mentors rely on mentees for specific guidance. As a startup it is up to you to leverage them. I've hogged Sameer's calendar and mailbox for more than 18 months now, although the "batch" may have been only 4 months.

3. We learnt a lot from the whole experience, but the learnings have been both ways. Advice is the extrapolation of past experience. This means some advice may be not be best applied to your case. Don't be Chatur (ref: 3 idiots).

4. Sameer loves bootstrapping, because it applies well to the Indian startup scenario which is still in infancy. Ironically being a Morpheus portfolio company gives you access to capital more easily than most startups (in India). Bootstrapping is a short-term strategy to reach the stage where you have a product-market fit or revenue. Not recommended long term if you've not got enough personal wealth (another philosophy where I differ from Sameer).

5. On equity - yes it might seem expensive. But Morpheus would make money on that equity only in the event of an IPO, acquisition, company buy-back or maybe Series B/C if they decide to walk off. IF you reach one of those stages, you've created value so many times your original valuation that it doesn't matter to you if they took 6, 8 or 10. I do agree with one of the comments below that it will set a bar for future fund-raising, so if you're too far along in your startup and "have it all figured" you may want to skip.

Getting into Morpheus

1. Be genuine (interpretation left as an assignment).

2. Have an interesting idea/prototype. "Me too" startups will have a tougher time.

3. Get introduced through one of the batch companies or startups that know them improves chances.

4. Spend some time informally discussion your startup to see how much value they can add.

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3 points by startupfundas 1292 days ago | link

I think the single most important reason i would hugely recommend MORPHEUS is that they are willing to be paid in EQUITY ONLY for their time. Try getting any work done for equity and you will know what a big leap of faith that is.

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3 points by cloudnine14 1292 days ago | link

Do you accept single founder applications?

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3 points by guglanisam 1292 days ago | link

yeah

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2 points by shyamp 1292 days ago | link

Friends, This is Shyam, Founder, Make My Points (www.makemypoints.com). We are from Morpheus Batch 5. I would like to share my experience with morpheus so far:

- Being a single founder, I have been always looking for someone who can hold our hands to understand how things really work when you dream to build a huge company. My first discussion after applying to Morpheus Batch 5 was so good that it inspired me to go ahead with the idea even if we decide not to become a part of Morpheus batch, thankfully we are.

- Morpheus was a great help towards defining the track and vision. We modified the product as well as concept (still open to changes) 'n' number of times and suggestions from Morpheus guys were real great. Surprisingly one idea from Sameer is our key point of sales now.

- They are almost available all the time on mail / skype / sms / phone at the time you really need them. - Most wonderful part of this, they keep us updated with the world. Love the stuff they used to share on email very regularly.

- Got a great chance to meet some like minded people with-in their portfolio companies and few great guys outside as well.

- They always keep you in mind, every-time they see something important for you, they share it immediately. They have been very helpful towards sharing their contacts, forwarding leads and sending invitations for few important events.

Drawbacks:

- You get a lot of ideas from them, you just need to choose the one or more which are of your interest

- You get a lot of emails sharing a lot of updates from the world, you need to pick and go through which is of your interest (well, you may loose something important or beautiful stuff sometimes).

I sincerely feel very happy associating with Merpheus. I can be reached at shyam[at]makemypoints[dot]com, in case you need more details / help on this.

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1 point by startupfundas 1291 days ago | link

Plain and simple-if an early stage startup refuses a good deal for capital/mentoring just because he is willing to give 6% against the say asking of 10% he needs to get his head examined. The focus should be answering the simple question "will this deal take me forward in my business" if yes do the deal. Negotiate as hard as you can but dont kill the deal for a few percentage points.

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