CSN Stores (EF, Thursday, Week 8)
entrepreneurial-financeyear-twoKhosla Ventures approach to cleantech: attempting to build cleantech infrastructure, a la business groups in emerging markets
Khosla Ventures website has a lot of resources for cleantech entrepreneurs.
Factors to examine in valuation:
-- Growth projections => Will this venture's revenues grow like retail (slow) or like Internet retail (fast)
-- Cash flows => future CAPEX requirements per strategic plan (not much bricks-and-mortar required), structure of cash flows (negative Operating Working Capital; CSN gets paid before they pay suppliers).
-- Revenue composition => traditional merchant (Amazon; where firm is the merchant of record, and revenues = sales) vs. intermediary (eBay; where firm connects buyer and seller, and revenues = % of transaction)
Thinking about optimizing your spend on online advertising: "We're not increasing the number of customers, we're increasing our customer's total lifetime value/decreasing our spend on advertising."
"SEO... It's kind of a black art, so you can't really build a business off it." -- Steve Conine, CSN Stores