This document provides an overview of Alta Group Americas and its affiliated investment funds and programs. Alta Group Americas is headquartered in Lehi, Utah and has regional offices in Mexico City and Monterrey, Mexico. It operates several venture capital funds that invest in early-stage technology companies, including Alta Ventures Mexico Fund I based in Monterrey and Mexico City, and Alta Growth Capital based in Mexico City. It also runs the Kickstart Seed Program based in Monterrey and Guadalajara to support the Alta Ventures Mexico fund. In total, Alta Group Americas and its co-investors have invested over $1.25 billion in startups.
3. GROUP AMERICAS
Alta Group Americas
•Headquartered in
Lehi, Utah
Alta Ventures Mexico Fund I
• Headquartered in Monterrey
• Regional Office Mexico City
Alta Growth Capital
•Headquartered in Mexico City MEXICO
•Regional Office in Monterrey Kickstart Seed Program
•Support for Alta Ventures Mexico • Headquartered in Monterrey
• Guadalajara
3
7. Most Startups Fail?
Why is this acceptable?
Source: Small Business Trends Published 2008. Data from Bureau of Census
7
8. $400,000,000 - Direct Investment 7 Funds
$850,000,000+ - Co-investors X
$1,250,000,000+ - Total Invested
X
X X X
X
X X
X
A ER pr ise
O
X
8
9. “Most successful entrepreneurs I’ve met have no
idea about the reasons for their success. My
success was a mystery to me then, and only a
little less so now.”
- Bob Metcalfe, 3Com -Inventor of Ethernet
9
11. Doing good things…
Building alpha & beta versions of their products
Writing marketing materials
Hiring sale teams
Business development deals
Talking with analysts
Talking with customers
Building prototypes
Etc…
11
12. Scale It
Nail It
The Big
Scary
Chasm
Innovators Early Adopters Early Majority Late Majority Laggards
Confidential Copyrighted Training Materials: Do Not Distribute
November 4, 2011 12
12
13. Most new products and businesses don’t fail in the market scaling
exercise, but in pre-chasm stages in the…
The Early Phase
Black Hole
13
13
19. 19
Entrepreneurs are doing good things, but *
not doing them in the right order. More
than 80% of the time entrepreneurs are
ignoring customer demand the right
product mix until after they have started
to scale their business.
* Harvard Business Review: Beating the Odds When you Launch a New Venture by Clark G. Gilbert and Matthew J. Eyring
19
20. Premature Scaling
Building products before you nail the pain
Writing marketing materials before you nail the solution
Hires sales teams before you know how to sell
Spending money before you understand the business model
20
21. Based on the Waterfall Product Development Model
Test Sell
Identify
Create Build product, product
product
product alpha build to
opportuni
specs product beta customer
ty
product s
21
22. Build Now, Sell Later How NOT to build a business 1.0
Reinforced in most universities & VCs by the business plan class
Discuss with Perfect the
/ raise Find a product
Entrepreneu money from location, and add Sell the
r has a idea friends, develop the features for product
family and product broad
fools appeal
22
23. Product Development Model Based on execution not research
“Midnight “Feature Lock- “Sales Pipeline
Genius” Stage in” Stage Problem” Stage
Discuss with / Perfect the
Find a
Entrepreneur
raise money
location,
product and
Sell the Russian
from friends, add features
has a idea develop the product Roulette
family and for broad
product
fools appeal
“Escalation of
“American Idol”
Commitment”
Stage
Stage
23
24. Entrepreneur Begin with the
Identify
has a idea Identify Customer!
Minimum Nail the
(based on Monetizeable (customer
Feature Set (of Product…
core Customer Pain centric
the customer)
competency) approach)
Deliver breakthrough customer centric
innovation.
24
30. More efficient launch process…
Efficiencies have driven down the cost of a startup.
$3-5 Million in late 90s = $50-300k today
Greater access to Seed Capital
EC2 - Amazon Web Services
Open source
20X number of consumers on the internet since 1997
Distribution through large social platforms
30
33. "...most often the very skills
that propel an organization to
succeed in sustaining
circumstances systematically
bungle the best ideas for
disruptive growth. An
organization's capabilities
become its disabilities when
disruption is afoot."
Clayton Christensen,
The Innovator's Solution
33
38. 149 ACCLERATORS
Only13% have an exit
The top .5% of accelerators have 85% of
the exit value
48% have not received any funding for
their companies
38
40. Incubators 1.0 (Dot Com)
1980:
12 Networked Incubators: Hothouses of the New Economy
Published: October 2, 2000
Authors: Morten T. Hansen, Henry W. Chesbrough, Nitin Nohria, and Donald N. Sull
2000: A successful company like Yahoo! is inundated with business proposals from
hopeful start-ups. When there is a wealth of opportunities, there is a poverty
of access because so many entrepreneurs are chasing so few potential
1000
partners, all of whom are extremely busy.
January 25, 1998
8 New Start-Up Incubators
for Business Proposed
40
51. Less than $20K investment
2-10% equity
Talent identification – Hacker News
No office space but office hours
Guaranteed follow on
Networking but not mentoring
Alumni Value = $7.78 billion*
Avg. worth of Ycomb company $45.2M
* Forbes April 2012 51
52. “For some reason more things than usual broke when
we jumped from 66 to 84.” – Paul Graham
Y Combinator Winter 2012
class shrank from 84 to 50.
Lowered follow on
investment from $150,000 to
$80,000
52
63. 63
2.
Systematic Innovation
3. IP
process
Documentati
on, Creation
Environments & Access
1.
Entrepreneur
Observation
-
of Market Pain
Inventor
4.
Community
Building/Net
working
5. Capital
63
64. 1. Get into the Field
2. Change or Fail Fast
3. Brutal Intellectual Honesty
4. Keep it Simple
5. Start Small
64
65. Paul Ahlstrom
Married, six kids, a golden retriever
Live in Utah & Mexico
Co-Author “Nail It Then Scale It”
Innovator, Entrepreneur, Investor
Founder Alta Ventures Mexico & Alta Growth Capital – Mexico
Founder KickStart Seed Fund & vSpring Capital – Utah
100+ investments over the last 12 years.
Ancestry.com, Rhomobile.com, Senforce, Aeroprise, Altiris, Juxta
Labs, Convert.com, Mural.ly
BYU - BYU Grad, BYU Rollins Entrepreneur Center
University of Utah & Ohio State- Board and executive committee of
the Technology Commercialization Office
Endeavor Mentor & ENLACE E+E Mentor - Mexico
65
Notas do Editor
Capital Emprendedor/Aventura Story
How often do we approach Startups like the seat of the pants entrepreneur.
If entrepreneurs have enough money, they eventually get it right… don’t they?Pareto principle named after Italian economist in 1906 Vilfredo Pareto, 80/20
Why it is acceptable in our industry to have an 80% failure rate? In which other industry in the world is this acceptable? Most VC’s aren’t increasing the odds of success
Most new ventures die before they even reach the chasm.Book Crossing the Chasm addresses how to cross the chasm.Paul asked Geoffrey Moore, author of Crossing the Chasm, how to companies can get to the Chasm. His answer? – “I don’t know.”
What drives entrepreneurs? There is an deep need to create, but once we build something, we will defend that creation… whether it is the Mona Lisa or Frankenstein.. It is still our baby.
All are working hard to innovate, but few can give me the definition of innovation.Innovation means connecting your invention with the customer (putting it in context)
Most people don’t know what their core competency is. If you don’t know what your core competency is, then go work for someone else until you have identified your inner genius. Not everyone should be an entrepreneur, that is OK.
Clark Gilbert & Matt Eyring.Why do entrepreneurs misprioritize their activities? That is how they have been taught… human nature… investors also contribute to the problem.Too much money, too early encourages premature scaling.
This is where Nathan and I connected. His PHD research and my street level observationsDoing good things, but doing them out of order. What is the right order and process we should follow to have consistent success?
The difference is the companies are leveraging and building off of their core competency.Known problems, known core competencies
Entrepreneurs are working on “unknown problems” and this model was developed for “known problems”, unknown customers, business models and no established distribution channels.What’s the difference? Unknown problems, unknown core competencies, unknown customers, unknown business models, ???Entrepreneurs are following in the footsteps of established companies, without understanding they are playing a different game. Unknown customers, no validated pain, no existing channels, unproven business models,
Once you have your idea, set it aside for a minute and start listening to the voice of the customer. (Does your product or idea address a monetizablepain? Validate your hypothesis of customer pain, solution and business model before building.
New model + less expensive resources makes it exponentially easier to iterate on Startup hypothesis until you get it right.
Year 2000 number: European Commission, Enterprise Directorate General, Benchmarking of Business Incubators, 20002, http://www.cses.co.uk/upl/File/Benchmarking-Business-Incubators-main-report-Part-1.pdfYear 2005 number: http://www.nbia.org/resource_library/review_archive/0807_02a.php
Quality first world problem
Early-stage investors are not afraid to do later stage deals, place greater amounts of money and syndicate with more investors. As with any classic disruption, the low-end of the market is moving upstream.
http://www.seed-db.com/accelerators
81 years earlier in 1877 – Thomas Edison learned the same lesson 1877 (it was year he invented the phonograph, his first “useful invention”
The phonograph wasn’t his first invention. That was a vote counter in 1869 (at the age of 22) Took him 8 years after his big failure to come up with his first success.The chairman of the committee, unimpressed with the speed with which the instrument could record votes, told him that "if there is any invention on earth that we don't want down here, that is it." The slow pace of roll call voting in Congress and other legislatures enabled members to filibuster legislation or convince others to change their votes. Edison's vote recorder was never used.
Ten years later he invented the lightbulb. Pictured around 1879, The year he patented the light bulb – 32 years old
The Edison versus Tesla productivity scorecard:Innovation output. Edison had received 1093 lifetime U.S. patents while Tesla had received 112. Although some of Edison’s patents (perhaps many of them) were bought or stolen, this is a huge number. Since Tesla wasn’t taking much money from Edison and only worked for him a short time, there is no way Edison could have stolen many from him.Innovation success rate. Almost 100% of Edison’s patents were tied to commercial successes while Tesla’s number was similarly high in the early years while working for Westinghouse then plummeted to about 20% after he went out on his own.Capital productivity. Edison built up sophisticated laboratory operations, employing some of the best and brightest people in the world, with Tesla among them for a while. Tesla built up similar labs while involved with Westinghouse and when on his own. The difference is that Edison did not hesitate to scale down or close operations from time to time as his organizational needs changed to remain solvent. Tesla had his creditors closing them for him.Labour productivity. This is one of the greatest differences between Edison and Tesla. Edison always had several people involved with his projects while Tesla generally worked alone. Tesla might have had extremely high levels of personal productivity at times, but Edison had the advantage of having a virtual army at his disposal. For example, Edison was able to accumulate over 5 million pages of organized records while Tesla had relatively few and they were not as well organized as Edison’s. Edison and Tesla both had legendary work ethics, but only Edison had it instilled at an organizational level.Media output (the Google Test). A quick Google image search of “Thomas Edison” generated 123,000 returns while the same search of “Nikola Tesla” generated 35,000 returns. Edison and Tesla each had the ability to engage the media in their day although Edison had the upper hand in this regard too.Network productivity. This is the Who’s Who test. Edison developed close relations with some of the most powerful and influential people around in his day, including Henry Ford, while Tesla also knew such people but tended to alienate most of them over time.
Process based innovationAligned vision and methodShared vocabulary and process Environment to improve and collaborate