Frank Maene: pitching a business to private investors
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Mr. Maene presents his great experience on how to pitch a start-up to a potential investor. Ye talks about right things and wrong things. Use his shared knowledge to attract investors and let your start-up grow faster. Join the IAMCP community (www.iamcp.org) to get access to an actual information, conferences and speakers.
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Frank Maene: pitching a business to private investors
- 1. FUNDING FOR STARTUPS by Frank Maene frank@voltaventures.eu @frankmaene
- 2. Volta Ventures SEED & EARLY STAGE VENTURE CAPITAL FOR INTERNET & SOFTWARE COMPANIES IN THE BENELUX frank@voltaventures.eu @frankmaene
- 3. About me • Volta Ventures • Hummingbird Ventures Big Bang Ventures • Helping Silicon Valley cies. expand into EU • Enterprise software • Economics degree
- 4. Why funding…
- 5. Investment to fuel growth • Finance fast(er) growth • Team hires • International expansion Investment to fuel growth
- 6. Investor for his added value • Sounding board / Coach / Mentor • Networking • Recruiting • Strategy • Assistant to the CEO
- 7. Do you really want/need a VC?
- 12. • Involvement? • Style? • Domain • Expertise? • Motivation?
- 13. How does a VC fund work? VC FUND LP HNWI LP Institutional GP Managers STARTUP STARTUP STARTUP
- 14. (Ad)Venture Capital? 5-6/10 3-4/10 1-2/10 deals will loose ± all the money deals will return ± 1x the money deals will work out and return 2-10x early stage VC’s have to seek deals with 10x potential ... hopefully resulting in returning the fund + 10% IRR
- 15. With a VC Comes…
- 16. Do you really want a VC? • Growth is the main focus • It’s not just you anymore • Team • Board • It comes with a contract, a.k.a. shareholders agreement • Exit ultimate goal (3-7 years)
- 17. • Cash • Exploit an opportunity fast • Stay ahead of competition • Advise, Network, Time Why choose a VC ?
- 18. 100% x $ 1M or 1% x $ 1B
- 19. Why should a VC choose YOU ?
- 20. It’s for you if ‘I lead but I seek input’ ‘I want to get big fast’ ‘Binary outcome = ok’ ‘I want to conquer the world’ ‘I’m the boss, till the end’ ‘I’m not in a hurry’ ‘ Let’s grow slowly&safely’ ‘I want to be big in Belgium’ But not if
- 21. OK, you’ve decided to go VC Now What?
- 22. Odds < 5% 50 mandays = min
- 23. How to pick an investor? • Right Region / Sector / Stage • Startup experience • Personal fit • Complementary / Value add
- 24. What do we need to know? • Market and size • Issues with current products • Your product • Competition and benefits • Revenue and Go To Market model • Team and execution • 12-18 month runway
- 25. Issues with European Start-Ups • Long on technology, short on marketing – A good product does NOT sell itself • Little experience with business plans, pitching to VC’s • Not convinced of need for A-team • Not very clear on positioning, target customers and value proposition • Long on figures, short on vision/dream • Full of themselves, not interested in competition
- 26. Turn offs • “Sign an NDA or I tell you nothing” • “Our numbers are very conservative” • “There is no competition” • “The Americans don’t get Europe” • “We’re just back from a very good –first- meeting with Microsoft/FB/Cisco …” • “We provide real service” • “We’re committed to our customers” • “A Big 5 did our financial plan, so it must be right”
- 27. Risk Assessment Criteria ADDRESSABLE MARKET COMPETITIVE POSITIONING PROSPECTS REVENUE PARTNERS MARKET STAGE / TIMING COMMERCIAL RISK COMPLEXITY STATUS FOUNDERS TIMING FEATURE CREEP MARKET FEADBACK TECHNOLOGY RISK INTERNATIONAL EXPERIENCE START-UP EXPERIENCE COMPLETE SKILL COVERAGE HIRING OPERATIONS DELIVERY MANAGEMENT RISK INVESTMENT RUNWAY SYNDICATION CONTROL NEXT ROUND OUR STAKE FINANCIAL RISK
- 28. How to PITCH to an investor?
- 30. Investor ≠ Customer Company ≠ Product
- 31. How to get to term sheet • Focus • You are selling • Don’t ‘calculate’ valuation • Don’t give an agenda • Solicit competitive offers • Get a lead investor • Advisors? @frankmaene
- 32. It’s a process LEAD BP SENT INITIAL MEETING RADAR FIRST DUE DILIGENCE NEGOTIATION LOI DUE DILIGENCE LEGAL CLOSE
- 33. • No magic formula • Stage / Team / TAM • Comparables • Competition • Runway • Other terms Valuation?
- 35. Best when… Services, consulting, apps Graduates/ Students Get to MVP Get to MVP Fast growth Devices, IoT Collateral Research, Patents
- 36. VC has a big impact
- 37. Made in Europe
- 38. Source: NVCA
- 39. Respect
- 40. frank@voltaventures.eu @frankmaene By Frank Maene Thanks! Presentation by SUPERslides. be