With startup valuations falling as fast as oil prices, investors and entrepreneurs need to remind themselves how value is created when innovative high growth companies are built. Here’s a few books worth reading again or for the first time to think about entrepreneurship, investing, and creating value in the economy. I read some of these on kindle, others on audio, and others in print. Any way you read them... they're well worth it.
Yes - Venture Deals again. I recommend this one often. It's still the best book out there to help both entrepreneurs and investors understand the terms and structure of financing startups.
What can the entrepreneur actually have an effect on? The book is written for people wanting to explore entrepreneurship, but the approach to entrepreneurship here is along the thinking of the Lean Startup movement in that it challenges assumptions we make about how companies are built. Highly recommended Effectual Entrepreneurship for entrepreneurs or investors who are thinking about how they can make forward progress in a constrained environment.
The Black Swan
Understanding the fundamentals of optionality is practically required for anyone engaging in early stage growth companies. Startups by their nature are attempting to take advantage of the concept and The Black Swan by Nassim Nicholas Taleb is the best book to gain that understanding.
Like Effectual Entrepreneurship, Early Exits attempts to think a little differently than the traditional Startup -> IPO thinking. There are also many great opportunities building companies from Startup -> Acquisition and there are things you can do as a founder or investor to optimize for this.
The Success Equation
Like The Black Swan, The Success Equation focuses on the balance of skill and luck in all great successes. Michael Mauboussin is the thought leader in this space and this is a very accessible book about how skill and luck are balanced in all parts of our lives. For entrepreneurs and investors, having an appreciation for this balance is critical.
Yes Startup Wealth is my book, and it adds value to the conversation. The stories in here about investing in companies like Invisalign (huge IPO) and not making a penny are lessons we can all learn from. There's stories of successes in there as well, in fact there stories told from the investors perspective about 16 successful startup investments, 4 startup investments where the company failed, and 13 investments where there hasn't been a liquidity event.
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