科技與創業 START UP & HIGH TECH

科技與創業START UP & HIGH TECH 航欣科技董事長徐德馨顧問蕭學文

“信”創業的力量 • 從發生來看 • 他是你的能力 • 他是你的品格 • 他是你的操練 • 從效果來看 • 他是你的力量泉源 • 他是你的智慧泉源

Entrepreneurs with Great Faith Mose Paul

我要的是什么？ 發財成名地位榮耀其他的創業的代價是什么？青春健康家庭、子女朋友專業其他的成就 & 代價

Venture Capital Funding Process • Team Assembly & Business Plan • Contact VC (best via mutual friends or attorneys) • if VC interested, then • Initial Presentation & Interview • if gets pass VC investment committee, then • Due Diligence • if findings positive, then • Term Sheet Negotiation • if successful, then • Finalize Agreement • Closing • then, money in the bank， stock issued

Business Plan • To-the-Point & Brief • I page Summary • 10 –15 pages total • Single Product Focus • Product Advantages • Market Opportunities (with references) • Competition • Revenue Model & Projections • Potential Returns & Exit Strategy • 10X to 30X Return on Investment in 5 to 7 Years • Exit Potential via M&A or IPO • Team • Budget • Cash Needs to Profitability

After the First Round of Funding • Phase 1 : Product Development • Early-Stage Round of Funding (VC) • Phase 2 : Commercialization & Sales • Expansion Round of Funding (VC) • Phase 3 : Profitability • Late-Stage Round of Funding (VC) • Phase 4 : Growth & Long Term Outlook • Liquidity via Corporate Partner or IPO or Merger

In the Beginning • Product Idea • Answer to a Specific Market Need • Protect Product Idea • Patent Protection • Motivation • Money • Chances of Success • 6 in 1,000,000 from Idea to IPO • 1 in 10 from VC Funded to IPO

The Process of Starting-Up • Protect Product Ideas • Ownership must be clear • Patent Search & Work with Patent Attorney • Records & Patent Application • Provisional Patent Application (I year protection) • Founding Team Assembly • Incorporation & Issuance of Founder Stock • Typically, $0.001/share with 4-Year Vesting • Business Plan • Funding Sources • Friends & Family • Angels • Venture Capital • Corporate Partner • IPO

What Venture Capitalists Look For? • Real Market Needs • Potential Market Size • Potential Revenue Projections • Strategic-Competitive Factors • Management Competence • Funding Needs • Return Potential • Exit Strategy (Liquidity or Cash-out) • Time to Returns

Expectations of Venture Capitalists(Return on Investment) • Expectations • Start-up Stage – 60 to 100% per year • Later Rounds – 40 to 50% per year • Real World Results • Real 2004 Average Return – 8% per year • Real 11-year Average Return – 26% per year (2x in 3 years) Source: PricewaterhouseCoopers 2006

Percentage Equity Required to Yield 60% Ann. Return on a $5 million Investment • Holding Period Future Value ($ million) 50 100 200 500 • 3 years 41% 20% 10% 4% • 5 years 52% 26% 10% % Equity = {(Investment)*(1+% Ann Return)No. of years holding}/(Future Value)

Index for Computing Future Value • Multiples of Earning (P/E Ratio) • 20 to 100 • Multiples of Revenue (if not yet profitable) • 2x to 10x

What to Expect from Venture Capitalists • Money • Subsequent Rounds of Funds • Potential Business Partners • Strategic Discussions • Business Contacts • IPO & Merger Experience

After the First Round of Funding • Phase 1 : Product Development • Early-Stage Round of Funding (VC) • Phase 2 : Commercialization & Sales • Expansion Round of Funding (VC) • Phase 3 : Profitability • Late-Stage Round of Funding (VC) • Phase 4 : Growth & Long Term Outlook • Liquidity via Corporate Partner or IPO or Merger

Funding Source: Venture Capital

Reference • ChinaVenture 2008年第二季度中國創業投資市場研究報告 http://report.chinaventure.com.cn/r/f/45.aspx • 2008年中國創業投資年度研究報告 http://www.zero2ipo.com.cn/research/2009115133811.shtml • 第一季度VC報告：募資下降36.9％投資下降61.0％ http://capital.cyzone.cn/article/81657/ • 從"4F"找創業資金 http://xueyuan.cyzone.cn/chouzi-vcangle/84309.html

科技與創業 START UP & HIGH TECH