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Saving the Money

Are you a founder wondering whether allowing angel investment into your startup is a good idea? Or weighing the pros and cons of raising a Series A round via a venture capital investment? Deciding on the appropriate funding route for your company is not as easy as it might seem. With multiple options like equity crowdfunding, angel investment, and venture capital as possible funding options, choosing the right path for the long-term future of your company is not a decision that should be rushed. Fortunately, there are a number of extremely helpful blogs where you can discover tremendous amounts of fundraising advice.

Seeking funding wisdom from a variety of sources can help you avoid potential pitfalls as you decide on the appropriate course of action for your company. Discovering specific characteristics that venture capital firms look for in a founder, or rookie mistakes that turn off angel investors, are just some of the truths you can uncover when you read top blogs from fundraising experts. But how do you know which blogs to read? How do you know who to trust and who is just huffing and puffing in an attempt to make themselves appear to be a more seasoned investor than they actually are?

Here at SecureDocs, we’ve rounded up our top ten (and a couple more for good measure) blogs for funding wisdom. Some of our favorites may be blogs you already follow. Others may be fresh discoveries. Each of our favorites offers an incredible wealth of information for those considering their funding options. As you check out these blogs, you’ll find a virtual goldmine of fund-raising advice if you use the search function on each site. Mine previous posts for search terms like fundraising, raising, funding, warning signs, investment, and strategy. If you dig into the archives on each of these sites, you’ll find answers to fundraising questions you didn’t even know to ask. Without further ado, here’s our top ten must-read blogs for fund raising wisdom:

Paul Graham’s ‘Paul Graham’
paulgraham.com

 Mark Suster’s ‘Both Sides of the Table’
bothsidesofthetable.com

Fred Wilson’s ‘AVC’
avc.com

Naval Ravikant & Babak Nivi’s ‘Venture Hacks’
venturehacks.com

Openview Partners’ ‘Labs’
labs.openviewpartners.com

Brad Feld’s ‘Feld Thoughts’
feld.com

CB Insights
cbinsights.com/blog

Sean Ellis’ ‘Startup Marketing’
startup-marketing.com

Dharmesh Shah’s ‘On Startups’
onstartups.com

Nic Brisbourne’s ‘The Equity Kicker’
theequitykicker.com

In addition to the above-listed must-read blogs, Medium (medium.com/search) and SlideShare (slideshare.net) are also valuable sources of fundraising information. Search for terms like startup lessons, lessons learned, pitch deck, and fundraising in order to uncover the enormous resources on both Medium and SlideShare.

Whether you are considering seed funding for your early-stage startup, pondering a Series A round, or questioning whether closing a later round is a viable option, the above-listed sites can be extremely helpful. Dig into each of these blogs, follow the authors on Twitter, and immerse yourself in the funding knowledge at your disposal. We think you’ll understand why these blogs made our top ten list.

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BankSimple Blog: Six Tips for Safer Online Banking
As companies generate, store, and share more and more confidential information online, finding a secure document storage provider becomes a priority. There are many different solutions to choose from that range in price from free to hundreds of thousands of dollars a year. Free solutions, like Dropbox, have been popular by consumers and individuals are using it in their workplace for confidential business documents. Using a personal file sharing account for secure document storage of business documents is generally not a good idea, and prompting many companies to take a closer look at secure document storage platforms. Here is a list of five things you must consider when vetting providers.

Offsite Backup for Disaster Recovery- Automatic encrypted online backup is a key component in any disaster recovery plan as protection against hardware failure, theft, virus attack, deletion, and natural disaster. Any secure document storage solution you choose should have this in place to guarantee the safety of your sensitive documents.

Data Encryption – Data encryption is a process that converts data into an unreadable format.  The document storage solution you choose should protect documents while at rest using AES. Documents should also travel over encrypted SSL/TLS connections.

User Roles and Permissions – Another way to protect documents from unauthorized access is to set up and enforce user roles and permissions. Not everybody will require the same access to company data, and you should be able to chose who sees what. This is a critical component of any document storage solution, as many breaches are caused by unintentional human error. The odds of that decreases the more that access is regulated. In addition to selecting who has access to what, you should be able to chose what they do with the information- view-only, no download, full access, etc.

Two-Factor Authentication – It’s wise to implement two-factor authentication to protect against password-sharing, password-cracking, and carelessness. With two-factor authentication, a second factor is required to verify the user’s identity. For example, after entering the correct password, a user may then need to enter a one-time PIN number which is sent to the user’s smartphone via SMS.

Privacy- Since you are likely storing sensitive company information in the solution you choose, it is advisable to check the privacy policy of the provider you are considering. How do they treat the confidential information (names, email addresses) of invited users? Do they market to them or share them? Who has acsess to your data? Who from their support team or engineers can see your data? While these questions are often overlooked when evaluating the security of a system, they are important considerations.

This is a jumping off point of items to consider when vetting the security of secure document storage platforms. Other considerations consider ease of use, your company’s individual use case, and whether or not the solution is being used for finalized, signature documents or as a collaboration tool. In any case, security should be top-of-mind.

 

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Finding funding for your entrepreneurial endeavour is not as straight forward as it would seem. While you might initially think that as soon as you have established a product/market fit the venture capitalists will come calling, nothing is further from the truth. With startup companies around the globe clamouring for venture capital investment, today’s investors can cherry pick their investments and your startup idea might not make the cut. Fear not though, as venture capital investment is not your only hope. In fact, accepting a venture capital investment might not even be in your best interest. You might instead want to consider opting for equity crowdfunding instead. There are numerous crowdfunding platforms you can consider. Following are just a few options you can consider before you sign a term sheet from a venture capitalist.

Seedrs

Seedrs offers a platform that lets entrepreneurs raise funding for their ventures from a variety of sources. Investments on the Seedrs platform can come from family and friends, business associates, community members, or even angel investors.

(seedrs.com)

CircleUp

If your entrepreneurial idea is a consumer or retail product, you might want to take a look at CircleUp as a potential funding opportunity. CircleUp connects verified investors with product startups in need of funding. Whether you’re launching a food truck concept or a new beverage, you can get your product in front of potential investors who might be considering adding a consumer product startup to their investment portfolio. You can raise a little bit of funding from numerous investors instead of accepting a lump sum investment from one venture capital firm.

(circleup.com)

Crowdcube

Crowdcube lets startup founders pitch potential investors for funding. Similar to the way Kickstarter or Indiegogo raise funding for products, Crowdcube lets entrepreneurs solicit funding from investors. Business proposals can be in a wide variety of sectors including manufacturing, retail, and tourism. Explore Crowdcube’s platform details to see whether you might want to consider funding your venture via the crowd.

(crowdcube.com)

Our Crowd

Currently active in Israel, Our Crowd will soon allow investors to pool their investments into global startups around the world. Our Crowd combines the best parts of venture capital and angel investing into a unique crowdfunding platform. Review the specifics of their offering to see if Our Crowd might be a good fit for your entrepreneurial idea.

(ourcrowd.com)

Alphaworks

If your startup company already has a strong legion of supporters, you might want to investigate Alphaworks as a possible funding source. Alphaworks helps startups with strong community support to connect with accredited investors. Community supporters are able to invest alongside traditional angel investors. Review the funding details of Alphaworks to see if their platform might work for your funding needs.

(alphaworks.net)

These are just five of numerous funding options you can consider. Understanding that accepting venture capital investment is not your only choice is crucial if you want to build a successful company and maintain control of your business. While venture capital investment is the right choice for some businesses (especially if you want to scale on a global level), it is not necessarily the wisest choice for all entrepreneurs. Knowing what your alternatives are is extremely important, especially if you are getting to the negotiation stage with potential funding partners.

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Mergers and acquisitions and funding rounds used to require the creation of a physical, paper-based deal room where decision-makers could perform due diligence and review sensitive corporate documents in a controlled environment. These deal rooms were usually hosted at the vendor company or  law offices  with staffers  who assisted as needed as well as made sure that no one walked out with unauthorized copies of the documents.

While documentation was closely monitored, they really weren’t that great. First, you had to get there. This meant travel — oftentimes across country. You know the drill: if the deal room was located in New York and you worked out of Los Angeles, performing due diligence meant packing your suitcase, booking a flight, and kissing your family goodbye for a few days.

If you were the host of the deal room, you had your own set of issues. For example, you had to host all of these potential investors, buyers, or auditors,  usually at great expense.

Today, it has become much simpler. Thankfully, the virtual deal room has provided a solid, and in most cases preferable, option to the traditional deal room.

For starters, a virtual deal room is hosted online. Thus, travel requirements and scheduling conflicts are immediately taken out of the equation. Once you grant access to decision makers, they can log in and review your documents at their leisure. There’s no need to have a full-time paralegal hovering over investors, making sure that they’re both cared for and supervised so that they don’t walk off with your documents.

You can take security even further by requiring two-factor authentication, requiring the signing of a non-disclosure agreement prior to displaying any documents, and watermarking your documents. Finally, virtual deal rooms generate comprehensive audit logs, allowing you to gauge investor interest and see exactly who’s viewed what.

If you’re on the due diligence end, your life is much easier, too. Simply log in and access the documents that you need in an online virtual deal room — all without the hassles of modern travel. Instead of kissing your family goodbye, you can access a virtual deal room from the comfort of home.

No matter which side of the deal you are on, a virtual deal room can prove to be much more efficient than the traditional one.

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Filing cabinets

Moving the company’s financial documents from a physical filing cabinet to an online document repository is a smart move, allowing for greater security and flexibility. The first step is to vet your options and ensure the virtual data room or other document storage service you choose has the proper security controls and features you need. After that’s done, you may wonder want to do next. Use the tips below to transition from a paper-based system to an online corporate repository.

-Create folders - How you structure your corporate repository is up to you. However, your folder hierarchy will impact users, making it important to create a folder structure that is both well organized and user friendly. For example, you might create main folders for corporate records, financials, and material agreements. Within each main folder, you could then create subfolders and sub-subfolders if needed.

-Create user roles and permissions - Next, set up user roles and permissions. You may not know who the actual individuals are at this point. However, you do know that certain categories of users will need different levels of access. Think about the different needs of CFOs, investors, auditors, department heads, and others who may need access to the corporate repository and assign the bare minimum permissions possible for the job role. This gives you a starting point. You can always add permissions on a case-by-case basis.

-Set up non-disclosure agreements – Access to your corporate repository should be granted only after a user has signed a non-disclosure agreement. Depending on the solution you have selected, you may need to do this manually and then upload a copy of the signed agreement after the fact. With SecureDocs, NDAs are both customizable and automatic. Once you’ve configured your NDA, the system will prompt users to sign before they are granted access to a protected document.

-Upload documents – Now that the basics are in place, it’s time to start uploading documents to your corporate repository. You may need to use a scanner to digitize some of your paper-based files. If you’ve chosen a solution that allows for drag and drop uploads of folders and documents, getting everything into the data room will be simple. Start with the first folder you created and work your way down the hierarchy. Remember to place documents in the most appropriate folder or subfolder. At this point, you may find that you overlooked a category. Make new subfolders as needed, paying special attention to your existing structure.

-Assign permissions – As you upload documents into your repository, you will need to assign permissions. For each user role, you can designate specific permissions to a folder or document such as: no access, view only, download, or full access.

-Invite users – Finally, it’s time to invite users to your corporate repository. It’s not a bad idea to start with a few trusted colleagues to test the system and make sure it’s ready for real-world use.

Setting up an online document repository isn’t overly difficult, especially if you choose a solution with a simple user interface such as SecureDocs. With a well-organized structure and the right user roles and permissions, your end-users should be able to find what they need without compromising security.

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The SecureDocs Virtual Data Room team just got back from Bio International 2014  in San Diego, CA. The event was fantastic- we met great people and learned a lot. Albert Oaten, SecureDocs VP of Market Development, offers his perspective. 

The return of the Life Science IPO and M&A markets, and speakers like Richard Branson and Hillary Clinton, put a bounce in the step of executives attending Bio International 2014.  World Cup brought a common international language for everyone to share and reduced seasoned executives to their younger selves, bouncing and kicking soccer balls. The show reflected some general trends in the Life Science Industry including the increasing role national, and state governments are playing to support early stage companies.

Gerard Lenstra, Netherlands, Matthias Bach and Pascal Riewe of Germany

Gerard Lenstra, Netherlands, Matthias Bach and Pascal Riewe of Germany

Increasing numbers of companies are focusing on targeted drug therapy innovation combined with more refined trials that include individuals with specific genome characteristics.  Partnering, business development, and education were the primary themes, but connections and contacts may be the most important outcome for the companies attending.

 

The mix of international government programs, early stage companies, attractive foreign direct investment incentive options, privately-funded startups with unique technology, coupled with the talented ecosystem of specialized CROs, drug discovery and drug manufacturing solutions, made for a rich participant mix.  The end result was high-IQ researchers interacting with experienced business executives, finding ways to formally and informally help each other.  Bio International 2014 did a great job facilitating after hours environments where everyone could mix together, share drinks and listen to live music.  Early stage entrepreneurs could learn about executing operationally and navigating the business end of fundraising and partnerships.

For vendors like us, it was a great format to meet with our clients and prospective customers in the United States and overseas.  As you might expect, midsize and mature companies were very aware of the risks posed when sharing sensitive information with investors, CRO partners, etc… and almost all use a virtual data room. It was also an opportunity for us to meet with early stage companies that were either starting or preparing for fundraising. Increasingly, we found companies using virtual data rooms as a document repository for ongoing readiness for fundraising series A, B, C…. to M & A or IPO and everything in between.

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Overall, Bio International 2014 was not just about the Life Science industry, but the collaboration required among countries and government agencies, coupled with a complex ecosystem of vendors, all needed to move our knowledge forward to improve the length and quality of the human condition.

Thank you to Bio International 2014 for making this a wonderful and productive show for everyone.

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Web privacy

When looking at any type of software, the concepts of security and privacy are often thrown together. Clearly, there is an overlap. However, in the context of file sharing services, whether they are collaboration tools or a dedicated virtual data room, there are differences to consider.

If you subscribe to a file sharing or secure data room service from a provider with a clear track record of delivering a quality product, there are some reasonable assumptions regarding the steps they are taking to secure your data. Those steps will typically be listed on the provider’s website and are likely to include a high-grade of data encryption at rest and in transit, a dedicated slice of a data center that has ISO 27001-type accreditation, and you’ll read about system monitoring, disaster recovery, firewalls etc.

In addition, you may also see details around password protection- which can be a critical component, passwords are a weak link in any system that requires one. Security conscious CTOs will always look for a program offering two-factor authentication on log in as standard, it should not cost extra. Two-factor authentication requires a second piece of information in addition to the password, typically an SMS text code, to unlock access to your system. Well-designed software will make this a seamless step, not an interference.

You may go on to make a the not unreasonable assumption that because your data is well-secured, it is also being kept private. This may or may not be the case and there is benefit to digging deeper and understanding exactly what happens when you subscribe to a service. The provider’s terms of service will usually tell most of the picture and there are three key areas to consider:

1) Who has access to your data at the provider’s end?

-Engineers – there has to be some ultimate level of access, they built the system, they may need access to fix issues. However, are there internal controls to manage and monitor who and why data is being accessed? Are those people subject to background screening and what are the consequences for those who violate the rules?

-Support staff – Many data room providers and collaboration solution providers will have a support log in or “backdoor”. If you’re in a business where data sensitivity is low and you’re sharing non-confidential information then that’s probably not a consideration. If you are in the healthcare, life sciences, financial services, or defense space, or run a professional services firm where your client’s data could get exposed, it could be a different story. The nature of the work conducted in virtual data rooms is usually highly confidential. M&A deals can affect share price so even a small snippet of information about who’s buying who has potential value.

-Sales, marketing – Less likely to have access but still worth checking, particularly on the marketing side (see next point).

2) Are your users’ information (particularly email address) kept private or are they marketed to?

Online data room services and file sharing tools have a very enticing characteristic for the provider and the provider’s investors: When one person (or company) uses the service they will, almost by default, expose others to it. There’s a viral effect that can help the rapid spread and adoption of the product.

Dropbox nailed this process by offering free data storage capacity to encourage users to “infect” their friends and associates, it has been extraordinarily successful. They hit the Holy Grail of subscription software marketing- an explosive viral multiplier- and anyone who runs a software as a service business should be both awed and jealous of that success! Other providers of collaboration and VDR services also market to their client’s users trying to leverage the exposure they have gained from the initial user, some overtly, some more subtly.

As an individual consumer looking to share music files with friends this viral effect probably doesn’t worry you and might even be a benefit (if you get free storage space and all your buddies are using the same tool there’s no downside!). However, as a business user of a file sharing or virtual data room service do you want your users to be marketed to? If you are using a virtual data room it’s likely because you need to work with investors, business partners, acquirers, lawyers or bankers during fund raising, M&A or other high-level business transactions. Maintaining a high degree of professionalism is important and causing any irritation for someone who might write you a big check might not be wise.

3) What is the software provider’s internal policies with regards information management?

Secure virtual data rooms are used to conduct private and often sensitive transactions. The nature of a data room use case, such as a merger or acquisition, can have a knock on effect for the share price of a listed company, that information has value and cannot enter the public domain.

Even if your data room provider encrypts your data, stores it in state of the art data centers and locks it’s employees out of the data….there’s still potential for information leakage, mainly through employees who may unwittingly, and with no ill will or intent, talk about a deal. It might be impossible to guarantee that this kind of inadvertent data leakage ever occurs, however, it’s less likely to happen if the vendor has an internal code of silence and a known set of consequences for violators.

Other simple steps that the VDR vendor is taking are key: Support should never acknowledge the use of a data room with anyone other that the main admin or subscriber to the software. Any access to the data room by the vendor (via invitation or some other “backdoor” mechanism) should be by written consent of an officer of the client company. CRM systems (like Salesforce) should be password protected using two-factor authentication, strong passwords and short log out times. No use of client names without express written permission.

In summary there are very real differences between the steps a files sharing or virtual data room service provider take to secure your data as well as maintain your document privacy. Privacy of your data (i.e. no one is looking at it, ever), privacy of your users both within your company and with partners outside your business and, at a very basic level, software providers should be keeping the fact you use their service private unless there is specific written permission granted. Ask for these provisions in writing from your vendor if you think they are important and you can’t identify them in their terms and conditions.

 

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When it comes to secure document management, you have many choices. For example, you could place your company’s brochures, product manuals, and other marketing materials in an online repository or  for easy, centralized access by employees or customers. Likewise, online file sharing services like Dropbox make it easy to store and share documents, photos, and various works in progress. But what about documents that require  the highest level of security? Those should go elsewhere: in a secure corporate document repository.

Virtual data rooms have traditionally been used for transactions that require due diligence- M&A, fundraising, licensing deals, etc. More and more, we are seeing the virtual data room being used as a corporate document repository. Companies are choosing to store their documents, long term, creating an archive of the company’s most-important data. This information will be items that, in many cases, will be required to be retained for legal reasons.

A corporate document repository can be used to archive historical company documents such as financials, formulas, patents, and drawings. While preserving a snapshot of your company  is an important mission that can be accomplished by a traditional filing cabinet, using a virtual data room to archive allows for both secure document storage and selective document sharing. As such, using a data room as a corporate document repository gives you the added advantage of always being prepared for due diligence- because who knows when opportunity knocks.

What to Store in a Corporate Document Repository

As with any type of online document management system, you can store virtually any electronic file in your document repository. However, this isn’t the place to store routine documents and memos; reserve your corporate archive for your company’s most important documents such as:

-Articles of incorporation

-Business plan

-Business strategy

-Organization charts and biographies

-Employee agreements

-Charter and by-laws

-Investor agreements

-Asset documentation and inventories

-Insurance policies and history

-Leases, contracts, and service agreements

-M&A offering document

-Profit and loss statements

-Financial projections

-Tax records

-Legal documents

-Regulatory documents, licenses, permits, inspections, audits, etc.

Due to the sensitive nature of these documents, security is absolutely essential. You’ll need much more than a simple file-sharing app. Security features to look for include: 256-bit data encryption, SSL/TLS encryption, two-factor authentication included, ISO 27001-certified data centers, permission-based roles, audit logs, watermarking capabilities, view-only mode, disabled printing, and customizable non-disclosure agreements.

Setting up a corporate document repository is a smart move for any company that needs the highest level of security, wants to maintain their company records online, and  desires the added benefit of being able to quickly and securely share these documents, should the need arise. Using a virtual data room as your corporate document repository allows you to accomplish all of the above.

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  • Posted on June 13th, 2014 by Laura Fagundes
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What do I Love Lucy, donuts, wetsuits, and all-inclusive vacations have in common? These concepts all date back to the 1950s. Though the 1950s saw no Silicon Valley or hi-tech startups, traditional startups were alive and well. Below are a few of the many startups from the 1950s still delighting us to this day.

Club Med (1950)

Club Med, which now has 71 luxury resorts around the world, started in 1950. The first Club Med village was located on the Spanish island of Mallorca. Though this first “resort” consisted of unlit straw huts, the company’s founders pioneered the all-inclusive concept.

Dunkin’ Donuts (1950)

The first Dunkin’ Donuts shop opened in Quincy, Massachusetts in 1950. Within five years, the first franchise had opened. Fast-forward six decades into the future and today’s Dunkin’ Donuts serves over 3 million customers per day.

Desilu Productions (1950)

Desi Arnaz and Lucille Ball founded Desilu Productions in 1950 with the goal of converting the couple’s vaudeville act into a television series. The goal was reached, I Love Lucy was born, and the rest is television history. In addition to producing the beloved hit show I Love Lucy, Desilu Productions also produced Star Trek and The Untouchables.

Ore-Ida (1952)

Founded in 1952 by two brothers from Idaho, Ore-Ida gets its name from the two states of its birth: Oregon and Idaho. The brothers built a potato processing plant in Oregon near the Oregon-Idaho border. Ore-Ida was eventually acquired by the H.J. Heinz Company.

Body Glove (1953)

Another company founded by entrepreneurial brothers, Body Glove got its start in 1953. The Meistrell twins, Robert and Bill, had developed the first practical wetsuit and named it the “Thermocline,” a name that never really caught on. Billy described the suit as fitting “like a glove” and the name Body Glove stuck.

Sport Chalet (1959)

Sport Chalet was founded in 1959 after its founder stumbled upon a quaint little ski shop in the Southern California community of La Cañada. Yes, there is skiing in Southern California. Also nearby is the Pacific Ocean. After learning about SCUBA,  Sport Chalet’s owner added SCUBA equipment to its inventory followed by rock climbing and backpacking equipment. Though these sports were obscure at the time, Sport Chalet had found its mark.

Today, you can still enjoy the fruits of these startups’ labors. Most of these startups from the 1950s continue to operate. They’ve managed to remain true to their founders vision yet evolve with the times.

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Yesterday we hosted a webinar on cybersecurity, focusing on mitigating risk and protecting your company through insurance coverage. Our presenter, Roberta Anderson, Partner at K&L Gates, gave a lot of detailed and very helpful information on steps any company can take to ensure they are protected and adequately insured. One of the points she emphasized is that ALL companies will be hit by a cybersecurity breach at some point, so it’s important to be prepared- and insured. She reviewed the complex language in several types of insurance policies and outlined what to look for in a good policy that will provide coverage. The slides for the June 12, 2014 webinar can be found below.

This educational event was hosted be SecureDocs, a secure virtual data room for storing and sharing confidential information with maximum security.

Slides

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