MICHAL GROMEK PONTUS ENGSTRÖM1320 ENTREPRENEURSHIP ANDOPPORTUNITY , 22TH OF JANUARY 2017
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SOURCES OF FUNDINGFOR STARTUPS WITH FOCUS
ON CROWDFUNDING
ENTREPRENEURSPERSPECTIVE
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POTENTIAL QUESTIONS:
I HAVE A BUSINESS IDEA, SO HOW
DO I RECEIVE FUNDING?
CAN I JUST UPLOAD MY BUSINESS
IDEA ONLINE?
HOW CAN THE STARTUP THAT I
WORK WITH RECEIVE FUNDING?
ROAD MAP FOR OUR 90 MIN TODAY: DIFFERENT TYPES OF FUNDING SOURCES FOR ENTREPRENEURS AND STARTUPS (FIRST 45) WITH AFOCUS ON CROWDFUNDING (SECOND 45 MIN)
NO CANNED
SOLUTION :)
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OUR SESSIONS ARE TO SHORTTO GO INTO DETAILS INDIFFERENT TYPES OF FUNDING,PLEASE USE THE VIDEO LINKSAT THE CORNER OF THEPRESENTATION TO WIDENYOUR KNOWLEDGE.
FINE PRINT: YOU DON'T KNOW YET IN WHICH SITUATION THESTARTUP THAT YOU WILL CHOSE ACTUALLY IS.
POINTERS
TO THINK
AND EXPLORE
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STARTUP FINANCING CYCLE (MODEL)
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STARTUP FINANCING CYCLE (STAGES OF FUNDING)
PRE-SEED FUNDING
SEED FUNDING
SERIES A / SERIES B
SERIES C
FOR MORE INFORMATION WATCH OUR PRESENTATION FROM LAST WEEK - LINK
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STARTUP FINANCING CYCLE (MORE PLAYERS)
REWARD BASED CROWDFUNDING
INSTITUTIONAL FUNDING
HEDGE FUNDS
PUBLIC FUNDING
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STARTUP FINANCING CYCLE (WHAT DO YOU PITCH)
TEAM VISION MISSION TRIGGER EMOTIONS REPUTATION
INSTITUTIONAL FUNDING
HEDGE FUNDS
PUBLIC FUNDING
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STARTUP FINANCING CYCLE (WHAT DO YOU PITCH)
TRACK RECORD PATENT APPLICATION TRACTION RETENTION DATA, DATA, DATA
INSTITUTIONAL FUNDING
HEDGE FUNDS
PUBLIC FUNDING
FRIENDS FAMILLY FOOLS
THEY JUST FUNDING, DON'T HOPE FOR STRATEGY TIPSCAN BE A NIGHTMARE TO DEAL WITH THEM - SO FAR LITTLEBUSINESS S EXPERIENCE (IT WAS FOR ME) IN CASE BUSINESS FAILS THEY CAN TAKE IT PERSONALLY
DOWNSIDES
COMMUNICATE RISK CLEARLY HAVE A SHAREHOLDER AGREEMENT DON'T ASK FOR MONEY THAT THEY CAN NEED
TIPS:
UPSIGHTS
USE YOUR REPUTATION
DON'T CHECK CREDIBILITY
LESS BURACRATIC
BUSINESS ANGELS
BUSINESS ANGEL CAN BE STRONG INDIVIDUALS, AND SOME GOTWEALTHY BECAUSE OF LUCK AND NOT NECESSARY EXPERIENCE. SOME BUSINESS ANGELS LIKE TO HAVE MORE CONTROL THANWHAT FOUNDER ARE WILLING TO GIVE.
DOWNSIDES
SPEAK TO FOUNDERS OF COMPANIES WHERE BA'SHAS INVESTED INTO. REVIEW THE BA'SPERFORMANCE IN YOUR SECTOR
TIPS:
UPSIGHTSINVEST ON EARLY STAGE, LIKE TO TAKE RISK
CAN OPEN DOORS WITH THEIR INFORMAL NETWORK
MONEY IS NOT A LOAN (USUALLY)
BUSINESSES OPERATE LONGER AND HAVE A HIGHER RATE OF RETURN
LINK TO HOW TO RAISE MONEY FROM ANGEL INVESTORS (PLEASE SKIP FIRST 12 MINUTES)
VENTURE CAPITAL
LONG DUE DILLENGENCE PROCESSTENDENCY 95% DISCOUNTED VALUATION METHOD STRONG PERSONALITIES SINCE 2009 > USUALLY LATE STAGE FINANCE (SERIES A+)
DOWNSIDES
UNDERSTAND HOW VC WORKS (PRESENTATION BELOW)REVIEW WHEN THEY HAVE BEEN RAISING MONEYAND IS THERE OWN PERFORMANCE
TIPS:
UPSIGHTSMAYBE SMART MONEY
STRONG NETWORK
LONGTERM PARTNER 4.2% OF VCEMPLOYEES ARE
FEMALE*
*SOURCE: http://fortune.com/2015/01/30/women-are-not-making-progress-in-male-dominated-vc-world-data-shows/ (ACCESSED 20th OF JANUARY)
LINK TO HARVARD INNOVATION LAB ON HOW VC MAKE DECISION
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HOW DOES VENTURE CAPITAL
MAKE MONEY?
60 SECOND CHALLANGE :)
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GET A PIECE OF
PAPER READY
AND A PEN OR THE ELECTRONIC VERSION OF IT :)
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60 SECOND BONUS CHALLANGE :)
WHAT ARE MANAGEMENT FEES?
HOW HIGH ARE PERFORMANCE
FEES?
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60 SECOND BONUS CHALLANGE :)
2% MANAGEMENT FEE
20% PERFORMANCE FEE
OTHER FORMS:
CREDIT CARS, OVERDRAFTS = EXPENSIVEINFORMAL DEBT
EQUITY INVESTMENT (ALMI INVEST)DEBT AT AROUND 6%-10% (ALMI) COLLATERAL GUARANTEE EUROPEAN FUNDING (FRAMEWORK7) VINNOVA (GRANTS
GRANTS GOVERNMENT
CAN BE VERY TIME-CONSUMING ADMINISTRATION MIN. SIX MONTHS
LINK TO THE INITIATIVE OF THE EU COMMICION ON STARTUPS
TO MUCH OF THE FUNDINGDESCREASES THE SENSE OFURGENCY AND FOCUS ON SALES(EXAMPLE: OUR FIRST GUESTSPEAKER)
PLANNING FOR FUNDING IS ONLY AS GOOD AS THE QUALITY OF YOUR BUSINESS FORECAST
TO SMALL FUNDING ROUND(PERMANENT FOCUS ONFUNDING - IT TOOK MEAROUND 70% OF MY TIME TOFOCUS ON FINANCE)
WHAT IS REALLY NEEDED AND WHAT IS A LUXURY SCENARIO?
WHAT IS REALLY NEEDED
HOW WILL THE FUNDING REALLY BE USED?
WHAT SHOULD THIS BE USED FOR (BACKGROUND BIAS)
BUSINESS MAJORS - INTERNATIONALISATION
MARKETING - ONLINE OFFLINE MARKETING
PUBLIC RELATIONS - BIASED
ENGINEERING BACKGROUND - PRODUCT, PRODUCT, PRODUCT
YOU CAN PLAN AND CONTROL EXPENSES BY NOT REVENUE
PLEASE FOCUS ON SALES (!)
2. CONSERVE YOUR EQUITY THIS IS THE ONLY ASSET YOU HAVE.
WHAT SHOULD YOUR STARTUPS FOCUS ON
GET YOUR STRATEGY RIGHT FIRST.
FUNDING DETERMINE MIGHT DETERMINE YOUR STRATEGY
INVESTORS WILL BE CONCERNED WITH:
MARKET RISK
PRODUCT RISK
FINANCIAL RISK
WHAT IS HAPPENING IN THE FIELD OF BUSINESS FIELD OF YOUR STARTUP?
MONEY IS THE SOLUTION, WHAT IS THE PROBLEM.
NEWS.GOOGLE.COM HTTPS://TWEETDECK.TWITTER.COM/#TRENDS.GOOGLE.COM
FIRST JOURNEY OF AIRBNB
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NEXT STEPS
DIFFERENT INVESTORS DIFFERENT MESSAGE
THERE IS NO "ONE TYPE OF CROWDFUNDING"
PLEASE WATCH THE VIDEOS, THAT YOU CAN ACCESSAS HYPERLINKS IN THIS PRESENTATION BEFOREYOUR FIRST MEETING WITH YOUR PARTNER STARTUP
EXAMPLES OF PITCHES
1320 ENTREPRENEURSHIP ANDOPPORTUNITY , 20TH OF JANUARY 2017
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SLIDES ARE ONLINE ON: SLIDESHARE.COM/
MICHALGROMEK (4:30PM)
CC LICENSE FOR DISTRIBUTION
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BREAK
UNTIL 15:15