A post office box (often abbreviated P.O. Box or PO Box) is a uniquely addressable lockable box located on the premises of a post office station. In many countries, particularly in Africa, and the. 2018 UPDATE Revealing the best UK virtual postbox for mail forwarding, with indepth reviews of UK Postbox, ExPost, BPM, Post Central and MyUKMailBox. Does no one do Maths on this forum, do they just post questions. Feet for size of small box and large box side will be twice that.
Understanding “Venture Scale”
One of the most important things (and most often overlooked) to consider when starting a company is the context in which your business exists. Context can mean a lot of things, but the one I want to focus on today is scale. Scale impacts how you run your business & how you partner with others – a business looking to make $200k/yr operates very differently from one looking to make $200M/yr. Similarly, a business looking to make $200k/yr talks to very different investors (banks, friends) than one looking to make $200M/yr (VCs).
Let’s look at what it takes to be a “venture scale” startup. Being venture scale, at its core, means being a business capable of growing quickly enough to give VC backers a potentially huge return on their investment in a fairly short timeframe (<10 years, ideally 5-7). In order to do so, you’ll need to be pulling in about $100M in revenue in ~5-7 years.
You’ve probably seen a graph like this before – hockey-stick growth, up and to the right:
Well take a closer look at the numbers you’d have to produce to make that chart happen:
That’s how you get to $100M in 7 years by doubling revenue every year. Now, assume your first year isn’t a breakout success (or you haven’t established a business model yet), and your timeframe gets scrunched even closer together, meaning you have to more than double revenues every year.
That’s the context in which a VC who’s looking at your business will consider it in: a business that doesn’t have a way to get to those revenue numbers in that timeframe just isn’t worth their time (even if it’s a perfectly good business).
Now, obviously, a lot of these sorts of numbers are unknowable up front, so you create projections. But those projections still have to fall into a reasonable range for the VC, and for that they have to consider the context of the market in which you play: is it a big enough market for someone to take $1b chunk out of it? Would employing technology in a new/novel way allow someone to take that big a chunk in the immediate future? If they did, would it be defensible?
Large Outside Post Boxes
If you can answer all those questions affirmatively, you’ve made it through one stage of context. The next is whether you & your team specifically fit the context of the market need – do you have relevant experience, training, or knowledge? Have you worked together on something awesome before? Have you done something clever with technology & launched it with great results, proving the need in the market?
If you can answer all those questions well, you’re in pretty great shape for a seed round. But keep in mind you’re dealing with humans across the table from you, and humans are imperfect, so you may not be evaluated purely on those merits. The further along you get, the more metrics-driven the fundraising will be, but until you hit the public markets, your company is worth exactly as much as you can convince a VC it’s worth. And a VC wants to believe it’ll be worth hundreds of millions to billions of dollars within a few years, if they’re going to open their checkbooks.
So when you’re considering your business, consider its possible scale, and reasonable timeframe for that scale. If it doesn’t fit the VC’s scale, it’s not worth your time to pursue their money. There are plenty of other options for how to build a business (bootstrapping, loans, crowdfunding, etc), and understanding the context in which yours should operate will give you a better idea of how the business needs to get built.
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