The startup investment boom

-
Lately there have been many positive news about investments coming to Estonian startups. For example $1,2M in VitalFields and $1,8M in Monese. This is very good for the Baltic-Nordic and European and especially for the Estonian startup scene. With the interest rates at 0 and the stock and real estate markets already overvalued the world changing startups are indeed a viable option for investing.

However I would still urge to keep the feet on the ground and get more focus on real business like revenue, paying customers, net profit and dividends. Think about the following questions:

- Why does getting an investment make such big news whereas getting a bankloan does not? After all an investor expects 1000% return (a bank 10-16%/year).
- Why is offering a free socialnetwork service to million users seen as good business whereas giving out free apples on the street to million bypassers seems a very stupid idea? After all apples do grow on the trees also for free.
- If three people have worked on a business idea for 12 months and are offering 10% of equity for 300 000 euros (which seems to be a quite common case for the first investment round) then have they really created something worth 3Meur? That is 83keur per month per person?

Comments

Post a Comment

Popular posts from this blog

Misconceptions regarding electric cars

-
Image
EU's Fit for 55 plan includes quite ambitious emissions reduction targets for the car industry and this has initiated a big discussion in the industry and among thought-leaders. I would like to point out two topics where our thinking tends to go wrong and where looking at the wider picture makes sense Let's think wider than just switching the power source from internal combustion to battery-electric. Here is a photo of one of the first cars made. It is a 1896 Arnold Benz, whose driver Walter Arnold received the worlds first speeding ticket for driving 13km/h with it. As you can see the car looks like a horse carriage minus the horse. It was only a few decades later that cars were considered to be cars and not horse carriages with engines and could therefore be designed differently. At present day we have a similar problem and are stuck in the thinking that an electric vehicle must be a car where everything must be otherwise the same only the engine to be a battery powered elect
Loe edasi...

How to move to Estonia Guide (for ICT consultants, specialists....but for others also)

-
The information in this post and the links were updated on 18th of July 2014. In my opinion Estonia is a good place for IT specialists to find a job and work in! Especially in the situation when the (youth) unemployment is rising and in many European countries there is no sign of it easing.  I promoted the idea to the Estonian IT companies in one of my recent posts . With this post I want to give my contribution to the exchange of talent inside EU. I hope this helps at least a few people.  This post is definitely not an official guide, but more of a friendly advice. If you have any questions regarding moving or any important information that could help others then please comment this post!  This post focuses on moving to Tallinn. Tartu, as the second biggest town in Estonia, is also an alternative with Playtech and Webmedia as the biggest IT sector employers there. The first thing you need is a job .  If you are an IT specialist with a university degree there is a good chance
Loe edasi...

Last mile delivery revolution in Estonia

-
Image
The revolutions that change the government tend to be noisy and bloody affairs, but the revolutions in technology and economics happen rather silently. This is because true technical revolutions happen when people start to take a new phenomenon as a normal everyday thing and don't even notice that they changed their behaviour. And one such thing is now happening in Estonia - the radical change in the last mile delivery. As an indicator, here is a list of changes that have happened in the last 5 years: There are now 3 parcel terminal networks operating in Estonia. Omniva, SmartPOST and DPD. Therefore there is competition and prices are driven down. Most E-shops are integrated with some or all of them. There are at least 5 online grocery supermarkets that offer home delivery: Selver, Coop, Fresh and Go, Barbora (the shop previously known as Maxima) and Prisma. One of the latest innovations is done by Coop, who offers grocery lockers that are refrigerated and to where you c
Loe edasi...