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A CEO s View of the New Venture World

Topics. The new-old venture worldInvestor expectationsFunding formula Due diligence on investors ProtectionsTo agent or not to agent. The Show We Went to See. . . . The Film We Keep Seeing. . . . . The New-Old Venture World One CEO's Perspective. You already know the bad newsRaising money is like raising the dead Endless zombie zoneBetter newsFast Buck Freddie is deadImproved terms for good businessesNew leader partners emergingBubble heads dyingSkilled management is availableThat 1142

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A CEO s View of the New Venture World

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    1. A CEO’s View of the New Venture World John Orcutt

    3. The Show We Went to See

    4. The Film We Keep Seeing

    5. The New-Old Venture World One CEO’s Perspective You already know the bad news Raising money is like raising the dead Endless zombie zone Better news Fast Buck Freddie is dead Improved terms for good businesses New leader partners emerging Bubble heads dying Skilled management is available That which does not kill you…

    6. Evolving Investor Expectations Expectations: Capital efficiency IRR: Triple digits now 35% (some upside) Liquidity: M&A or survive to thrive Maturity: 5 years, reserves >50% Focused strategy Disciplined execution Company strategy Execute early Over-deliver Learn & turn on a dime Don’t repeat mistakes Over-communicate

    7. The Funding Formula… If There is One

    8. The Funding Formula…

    9. The Funding Formula: Which Investors to Target

    10. Due Diligence Unto Others as They Do Unto You Define what you want & need Know why they want to invest Talk to portfolio failures Validate treatment of mgmt/employees Know how they act in tough situations Truly know the partner Iron out the working relationship Don’t panic

    11. A Little Paranoia is OK: Protect Yourself Get great attorneys Involve experienced advisors Build in incentives Structure personal protection

    12. Using an Agent Advantages Open doors Deal structure Negotiations Performance pay Administration Smoke out M&A Disadvantages Investor distaste Expensive Poor filtering Time Education PPM Infinite pitch loop

    13. Selecting an Agent Record: Some just don’t fail Terms: Negotiable Agree on Fundamentals: Expectations Commitment (who, for what) Processes Working relationship References: offered and blind Use your investor leverage

    14. Create a Successful Process Planning Clear strategy on targets; senior visibility Timetable, working plan, deliverables, owners Preparation Don’t rely on the formula Challenge each other Make sure one of you is conservative Execution Debrief after every meeting Tune the pitch (not the numbers) Drive the team daily Formal sessions incorporating seniors Flawless follow-up Don’t get trigger-happy

    15. Produce the Right Movie

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