AI Q&A Strategies for Avoiding Financing Risks
For financing, a high-risk aspect of entrepreneurship, AI can provide protection based on PG's Fundraising Survival Guide:
- a valuation trap: Ask "what valuation strategy is most prudent in the early stages [of the industry]?". AI will emphasize the "curse of overvaluation" that PG opposes, and give a model for calculating a staged financing.
- Identification of terms: Enter "Please explain the practical impact of [a clause] on the founding team". the AI will use the Airbnb case that the PG was involved in to illustrate the points of negotiating key clauses such as liquidation preference
- Investor Screening: Ask "How do you determine if an investor is suitable for the seed stage?" The AI will make a list of PG's "three harmful investor" characteristics
- Alternative Programs: Follow up with "What are the low-cost validation models if the financing fails?" ...AI will extract alternatives such as PG's 'consulting for equity'
Practical advice: Copy the real Term Sheet terms and ask the AI to interpret them, but hide sensitive information. After the conversation, use the "Generate Risk Assessment Summary" function to archive the analysis.
This answer comes from the articlePaul Graham: AI Advisor _ Smart Chat Tool Offering Startup, Programming and Life AdviceThe
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