business&pleasure

My journey started in Kalmar, a small city in south-east part of Sweden, and has gone through business studies at Linnaeus University, exchange studies at St Louis University, internship in New York City, and graduating BSc in Finance at Stockholm Business School. Via hard work, open-mindedness, and startup-mentality, I've come to the point where I'm operating my own company in Sthlm City. My hobby is my work, I really love connecting people to leverage ideas into fully fledged products. When I have free time, I prefer exercising. Swimming, running, biking, football, etc. Anything that makes your pulse rush and muscles thrive. My advice to anyone is to embrace the uncertain. At the end of the day there is no such thing as "free lunch". It a ways boils down to a risk/reward trade-off. What you give is what you get. Take the leap and leverage on the opportunity! Trust me, you will not get disappointed. Glad to have you onboard.

[norregardh]

Building a business is a bit like playing computer games. You play a track, learn it and then you level up. When you get to the next level, it takes a while to learn the new track, you have to stop, reorganize and adapt to the new level and then it is full speed ahead again. It is sometimes really hard, but usually fun and quite addictive.

Genius

[continuations]

Beware the Post Money Trap

In the current valuation environment many entrepreneurs seem to believe that only two numbers matter in a financing: the amount of the raise and the dilution. This leads them to buy into the idea that more money for the same dilution is always strictly better. Combined with a lot of money being available from investors this is resulting in Series A rounds of $10 million and more.

What could possibly go wrong? The number everyone seems to be forgetting about is the post-money valuation. It is a crucial number though as long as a company is not yet financed to profitability. It determines how far the company needs to come to be able to raise money again. It needs to build enough value so that the next round of fundraising can be at or ideally above the current post money valuation.

If you do a Series A with a $50 million post-money, it means you have to build something that people will consider to be worth $50 million when you next raise money. Now if your company hits a great growth trajectory and the financing environment stays as it is then great. But if either of those two conditions are not met you will find yourself in the post money trap.

Again, you can get caught in this trap in two different scenarios. The first one is that you hit a bump in the road. Users or revenues or whatever the most relevant metric for your business wind up not growing as fast as you think or worse yet hitting a temporary plateau, possibly even a small setback just as you need to raise more money. The second one is that the external financing environment adjusts for instance because the stock market drops 20%. Then even if you hit all your milestones, suddenly that may no longer let you clear the hurdle you set for yourself.

Some founders seem to ignore this logic entirely. Others come back and say “but we will have that much more money to and hence time to clear the hurdle.” That too, however, is faulty logic. It reminds me a lot of the problem of getting rockets into space. The simplistic answer would seem to be: just add more fuel. The problem though is that fuel too weighs something which now needs to be lifted into space. Your burn rate is pretty much the same thing. Unless you are super disciplined on how you spend the money you will have a higher burn rate the more you raise which makes subsequent funding harder (instead of easier).

Another, less common, founder objection is: well, if necessary we will just do a down round. This ignores that down rounds are incredibly hard to do. For reasons of founder, employee and investor psychology they rarely happen. And if they do they are often damaging to the company. So when you are in the post-money trap you have largely made your company non-financeable entirely.

Finally, this situation is highly asymmetric from the point of view of funds versus companies. First, funds have portfolios, so some deals with dangerously high post money valuations can be offset – if one is disciplined – with others that are more attractive. Second, when investing in preferred there is a lot of downside protection built in that’s not available to the common shares. Hence a simple test to see just how far you are stretching into is to ask investors (and better yet yourself) how much common they (you) would buy right now and at what price.

[norregardh]

”It reminds me a lot of the problem of getting rockets into space. The simplistic answer would seem to be: just add more fuel. The problem though is that fuel too weighs something which now needs to be lifted into space. Your burn rate is pretty much the same thing.” True dat ☝️

[norregardh]

So beautiful it hurts my eyes 😍 (at Stöten i Sälen)

[norregardh]

Snabbstopp hos @emiliaklappe ’s leverantörer. Tack 🇨🇳 för denna gång. “Surrealistic but nice” 😬 (at Shangri-La Hotel, Yiwu)

[norregardh]

Dagens vattenskoj. Ö-till-Ö Thai version 🌏 Jetski ToR över guppigt hav. Koh Samui 🏖⬅️➡️ Koh Phangan 🏝 Riktigt stark rekommendation på den! (at Secret Beach Koh Phangan)

[norregardh]

Tell me lies I’ll buy 🍟

[norregardh]

Annorlunda julmorgon. Annorlunda jultomte. Annorlunda julmiddag. Väldigt god jul från 🇹🇭 (at Ko Samui)

[norregardh]

Formen på slingan i Bruksvallarna kan omöjligt va en slump. Subtil kärleksförklaring till längdsporten ❤️ (at Bruksvallarna, Jämtlands Län, Sweden)

[norregardh]

[norregardh]

Cykelpass me glass 🙌🏻 (at Enzo Deli & Gelato)

[norregardh]

#sofinicke2017 morgonstund när sand blir till guld (at Åhus Seaside)

[norregardh]

#sofinicke2017 Ål-hus levererar (at Åmund Restaurang)

[norregardh]

#sofinicke2017 so it begins (at Hamnen I Åhus)

[norregardh]

Stockholm Triathlon avklarat idag. Djäkla skön resa ändå. Räcker att säga "cykla över Västerbron 8 gånger" så förstår de flesta känslan att va klar 😅 "Rickard, Välkommen till målet - Simning: 0:33:12 - Cykel: 1:15:59 - Löpning: 0:44:38 - Total tid: 2:41:58 - EST och World Triathlon Stockholm" Puss min älskling @emiliaklappe för support och photage hela vägen 😘 Oväntat snabb i växlingarna. Fan vet vad som hände på simningen men cykel och löp kändes bra rakt igenom. Stressigt inför sim-starten så maxat adrenalinpåslag redan vid start. Dålig rytm första sim-halvan. Sen motvind och mkt vågor i fejat andra halvan. Navigeringen kunde varit bättre. Men allting gick kanon och energin räckte hela vägen (+oförskämt fräsch efter). Dessutom Stockholmsvädret på toppnivå. Så absolut inget att klaga på. Bara utrymme för förbättring 😈💪 To be continued... 🏊🚴🏃💨 (at Vattenfall World Triathlon Stockholm)

[norregardh]

Join the joyride 🙌🏻 Skicka ett SMS till nummer 72700: ST mellanslag 1843 för bevakning. Lets go!

[norregardh]

[norregardh]

Regular Capri roads 🙈🙌🏻 (at Isle of Capri)