Eric Furlow

PSA: Please don’t personally guarantee a $5M business when you’ve never operated. I’ve seen this way too often – someone finds a deal, likes the numbers, raises a little equity, and maxes out SBA leverage with zero industry experience. And they sign a personal guarantee on it. They’ve never managed a crew. Never dealt with a supplier delay. Never had to fire someone who also happens to be the best tech on the team. But they watched a podcast or took a course and feel “ready.” The business owner sees a buyer with ambition. The lender sees a clean credit score. But 90 days after close, everything starts to unravel. And now the seller, who spent 30 years building this thing, is still getting late-night calls because the new owner is underwater. If you're serious about buying a business, great. But have the humility to partner with someone who knows the industry. Or better yet, go get some operating experience. That knowledge is worth more than any fancy financing tricks. These businesses trade at low multiples because they’re so hands-on. They require active ownership.

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“Why aren’t you investing in YC deals?” Because the math sucks. They’re getting funded on $25mm SAFES. ”But big VC firms are backing them, those guys are smart, why would they do that?” Because they can throw $100mm in on later rounds and make 10x on a much larger amount. _________________________________________________________________________ Bill Gurley of Benchmark fame posted on X last week about how the math really works for these YC deals. For most small and medium sized VCs, they invest in your seed because they think that stand alone investment will have a good ROI. But for mega-funds? The math is different. That first $1M check has almost nothing to do with returns. It's a call option on future rounds. As part of the deal, they get rights of first refusal on future financings. If the company becomes the next big thing, they're positioned to deploy $100M+ at attractive terms. If not, they write off the $1M. It’s not new really. We saw the same thing in mobile, cloud, and crypto. When there's a new technological frontier, the largest funds can afford to buy options on the whole market. The challenge is it creates a weird dynamic where companies raise at valuations that often only make sense for the largest players. Anyone who can’t write of millions in “exploratory” investments are effectively locked out. (That’s why we focus on investing in great teams, at reasonable valuations, who we know can ship). It also puts the founders of those companies unknowingly at risk. They love getting the blue chip investor in the door, mistaking the call option for genuine conviction. They don’t realize that when the big investor doesn’t participate in the follow-on round, that’s a huge red flag to other investors. And with a $2M total seed round, with SF expenses, the money goes fast. You’ll likely need to hit $1mm in revs to justify an upround. I’m not saying don’t take the money, please do. I’m just encouraging you to make sure you have enough to execute on your plan. And remember, everything takes longer than you think.

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A Venture Studio ignored venture and won. They built for Cashflow, not Venture. Here is how they did it: 20 years ago, an Atlanta-based venture studio operated with a unique approach. Instead of targeting VC or Private Equity, they  focused solely on cash-flow businesses like  professional service firms.  Here are 2 powerful lessons every studio can learn from their model: ------ 1. Funding Mechanism: A Line of Credit - Companies were funded via a line of credit, not equity capital.  - Portcos had to become cash flow neutral within 18 months—recycling capital quickly.  - Reduced funding needs = Faster scalability. This setup created discipline. Each month, portfolio founders had to justify every dollar spent. Want to hire McKinsey? Nope—do it internally.  Result? Founders learned to obsess over cash flow—an essential entrepreneurial muscle.  --- 2. Picking Founders Wisely  Successful founders were not running from bad employers. Instead, they were executives who always dreamed of building something but lacked the timing or resources earlier in life.  These proven leaders had:   - Strong networks   - Deep domain expertise   - Relentless drive to finally fulfill their vision  They thrived almost every time.  P.S. Which of these lessons resonates with you? 👇 Best, Matthew Burris

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Thinking of buying a business with 13% EBITDA margins using an SBA 7a loan? Let’s do the math: SBA wants 1.25x DSCR (minimum) PE prefers 2.0x+ DSCR—because they actually care about margin of safety At 13% margins and 90% leverage, your debt payments will choke the business You’re one slow month away from default. This isn’t a spreadsheet game. It’s real cash, real payroll, and a personal guarantee. High leverage + low margins = you work for the lender. If you’re going to borrow big, buy fat-margin businesses—or don’t borrow at all.

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If I see one more “Builder.ai raised $450M at a billion-dollar valuation, but now they’re closing their doors, and here’s the inside scoop on why it happened…” post, I might need a stiff drink. Let’s face it—building companies is tough. Most fail. Some fail because of bad timing. Others because of bad business models, bad bets, or just plain bad luck. And let’s be real: some simply fail because of the founders ego. Builder.ai is just another reminder that in the startup world, survival is the exception, not the rule. It’s not about who raised the most money, but who builds something that actually works. To all the founders and dreamers out there—may you keep building, learning, and remembering that a “unicorn” status doesn’t mean you’re bulletproof.

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🔥 I raised $40M in venture capital for my last startup. But getting a ~$2.5M SBA loan? Way harder. 💸 (Read that again.) 👀 With venture, you can go from term sheet to close in 30 days. Good luck getting an SBA loan funded on a business acquisition in under 3 months from start to finish. The SBA and the bank will do more diligence and paperwork on you and the business than all your VCs combined. 🔍📑 The closing process is night and day. Raising VC is like having TSA Precheck and skipping the 3-hour line ✈️. With a government-backed loan, you’re in that long line, piles of paperwork, rounds of diligence, and countless steps before you get the green light. 🛂 And yet… I’d still choose an SBA loan to buy a boring, profitable business over raising venture capital again. Why? Because with VC you’re dependent on investors and chasing runway, where 99% of startups never turn a profit 📉. With ETA, you step into a business that already throws off cash 💵 and you actually own your destiny 🔑. Owning a business that generates real profits beats relying on the next round of funding to survive. 🚀💪

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Market uncertainty isn't a hurdle - it's an opportunity. $4 trillion in recently liquidated capital sitting on the sidelines. Here is what you can do to win... Limited partners are looking for places to invest their sidelined capital right now. Venture capital thrives in these market conditions. ⏭️ Investing in venture capital will skip the uncertainty, as early venture returns take 3 to 5 years 🌱 Emerging managers consistently generate the best returns in uncertain markets 💰 Early-stage VC is countercyclical—returns historically increase following market crises ⏱️ Moving quickly is essential - the closing process takes 2-3 months, so timing matters 🔄 Seasonal timing is crucial - avoid mid-summer and mid-winter for fund closing 🧠 Master the fear/greed paradigm by turning market challenges into opportunities ✅ Stay positive and energize your limited partners about the unique moment Are you prepared to seize the opportunity while others wait for "certainty" that never comes?

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One of the most common ways I’m brought into a deal is when a business owner has already begun informal conversations with a potential buyer, and somewhere along the way, they start questioning the valuation or feeling uncertain about how to navigate the process. At that point, a trusted advisor or peer will usually make the introduction, either to help manage conversations with the current buyer or to prepare the business for a broader, competitive process. In my experience, the original buyer is rarely the final buyer. Why? Sometimes it’s because the buyer was pursuing a discounted valuation, knowing there was no competitive tension. But often, the deal stalls for reasons well within the seller’s control. Before a single offer is made, sellers can unknowingly tip the balance by: ❌ Responding to inbound interest without preparation ❌ Sharing fragmented or inconsistent financials ❌ Agreeing to exclusivity too early ❌ Failing to define the narrative behind the numbers In the absence of clarity, buyers fill in the blanks in ways that protect their downside and favor their position. When a seller appears reactive or underprepared, it can shape the entire tone of the deal, often to their detriment. That’s why we stress intentional preparation 𝘣𝘦𝘧𝘰𝘳𝘦 any buyer conversations begin. And if we get involved mid-conversation, sometimes we help the seller pause discussions and get organized, so that they can be more strategic moving forward. Great outcomes typically don’t start with the first offer. They start with the seller leading the narrative, setting the pace, and creating options that help them meet their goals. #mergersandacquisitions #investmentbanking #exitplanning

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I got a $50K Delaware franchise tax bill—but only paid $450. If you’re a startup founder incorporated in Delaware, read this before you overpay. Delaware defaults to the “Authorized Share Method,” which calculates tax based on the number of shares you authorized—not what you issued, and definitely not based on revenue. That’s how some startups end up with a $50K+ tax bill. I’ve seen founders actually pay it—just because they didn’t know any better. What they should’ve done? Switched to the “Assumed Par Value Method,” which bases the tax on total assets and issued shares. The bill often drops to ~$500. Here’s how: ✅ Use IRS Form 1120 Schedule L (Line 15) to get your total assets ✅ Make sure you’ve issued at least 1/3 of your authorized shares ✅ File by March 1 to avoid penalties 💡 Free Delaware Franchise Tax Calculator to help founders run the numbers and file with confidence 👇 Don’t let default math cost you tens of thousands.

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Traditional software companies compete for $35B in IT budgets, but they're missing a much bigger opportunity: $4.6T in workforce spend. The same CFO who scrutinizes a $100K software purchase approves a million-dollar headcount without hesitation. Why? Because people deliver complete business functions. A System of Agents - a network of AI workers that collaborate like a human team - mirrors this complete execution capability. Each agent specializes in specific tasks while learning from other agents, delivering end-to-end business functions autonomously. By operating at this level they can tap directly into personnel budgets that traditional software never accessed. The market demands this shift and here's why: → Critical shortage of cybersecurity talent puts $8.5T of revenue at risk from data breaches and cyber threats → 75% of U.S. accountants approach retirement age → Healthcare providers struggle with 24/7 staffing requirements Innovative founders are reimagining how work gets done. They realize Systems of Agents will be able to handle thousands of tasks simultaneously, maintain consistent performance as complexity grows, and operate without breaks. This is autonomous operation at scale. And it's transforming how businesses think about capability delivery.

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What exactly is a Venture Studio? Here’s the 30-second elevator answer I give an asset allocator. “Picture handing capital to a serial founder with proven exits—and taking equity at the same price they take, zero premium attached. That’s a venture studio. We build multiple startups in-house, de-risk them early, and let investors sit in the founder’s seat from day one.” 📹 Curious how that plays out in the real world? Catch the 1-minute clip from my The Venture Studio Forum interview with JT Benton and see why allocators are rethinking portfolio construction around studios

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YouTube did not reach mainstream adoption until we moved from dialup internet to broadband. The technology was ready, but the infrastructure was not. The same thing is happening with AI in business today. What is holding companies back is not the accuracy of the models or the brilliance of the orchestration, but the infrastructure and readiness behind it. As we study companies applying AI to achieve operating leverage, those investing in their data maturity and infrastructure are the ones seeing measurable results. Once the foundation is strong, AI applications become the easy part. It always comes back to data and distribution. That is where the real differentiation lies. The AI application is quickly becoming the commodity.

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When people talk about tokenizing real estate, they talk about fractionalization. We don’t. We talk about control. The goal isn’t to break down the cap table for retail buyers. The goal is to structure access and reporting in a way that scales without compromising governance. That starts with digitizing trust structures, legal wrappers, distribution logic, and ownership records. We built our first blockchain-enabled real estate vehicle around a stabilized asset. Fully leased. Long-term tenant. Clean books. Predictable yield. We didn’t market it to crypto-native investors. We underwrote it like a traditional deal, then embedded tokenized rails into a compliant, closed loop. That meant: Every investor had to complete KYC/AML. Tokens were locked into wallets with compliance triggers. Transferability was restricted under Rule 144 for secondary events. Distributions were issued via smart contract triggers backed by on-chain payment logs. The result wasn’t speed. It was traceability. Every dollar in. Every dollar out. Logged, traceable, auditable. Not one LP asked for innovation. They asked for transparency. Blockchain helped us deliver it, not promise it. When tokenization is treated as a feature—not a product—you get systems that last. We’re not building for hype cycles. We’re building infrastructure that earns trust under pressure.

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Searching for startup investors here on LinkedIn, Google, or Reddit? Stop. You might be wasting months and precious runway. Here's what to do. After 7 startups and helping raise over $100M, I know finding the right investor is an infuriating process. But there’s a system to it. Here’s my investor-finding tier list, based on 25 years in the trenches (I've tested them all): Google & Reddit: You’ll get flamed, ignored, or worse, scammed. Serious investors aren't scrolling Reddit for deal flow. This is the fastest way to waste your time. Google is also filled with services that will leave you disappointed. Who can you trust? PitchBook: A powerful tool with great data. The problem? It costs tens of thousands of dollars. It's overkill for most early-stage founders who need to be scrappy. LinkedIn: The approach everyone should be using. You can research investors, understand their thesis, and build real relationships. But it's a major commitment. You have to be active and build your personal brand for it to work (which you should be doing anyway). Crunchbase: A fantastic, cost-effective starting point. You can find out who invested in similar companies, download lists, and cross-reference contacts. It’s a huge step up from guessing. Smart Tools: This is why I joined Startups.com. We built an investor-matching tool where I essentially baked my brain and entire process into an AI. It analyzes your deck and matches you with verified, relevant investors. It automates the outreach I used to do manually for hundreds of hours. Try our pitch deck analyzer and investor matching tool for free here: https://lnkd.in/ds2HPMZ3 The Combo: The real magic happens here. Use a smart tool like Startups.com to build your target list and automate initial outreach. Then, use LinkedIn to warm up those leads, build relationships, and show them you’re a founder worth backing. It’s not just about finding an email address. It's about combining intelligent automation with genuine human connection. Watch this video for my full tier list: https://lnkd.in/dbxsNmTT

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