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Join the competition to showcase your innovative business ideas. Apply online by November 20 at www.EntrepreneurshipFoundation.org. Compete for start-up grants up to $10,000! No entry fee! Early Stage and University Venture Fair at New Haven Lawn Club. Engage with investors and pitch your vision. Learn from experts and network with top industry players.
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University Business Plan Competition • Apply online by November 20 • www.EntrepreneurshipFoundation.org • By answering 19 questions • You can paste from a word doc • Answers limited to 1500 characters/spaces • Start-up Grants: $1000 - $1000 - $10,000. • Winner pitches to CT Angel Investor Guild • Cost: No entry fee
Early Stage and University Venture Fair • Apply online • www.Back-Offices.com/VCFair • $225 including two attendees • Three-minute PowerPoint presentation plus exhibit table. • 1:00 – 7:00 pm • New Haven Lawn Club • 30 Companies/ 30 Investors
Evaluating Business Opportunities North Bridge Venture Partners Signal Lake Ventures Connecticut Angel Guild Connecticut Venture Group
The Deal Scorecard 1 10 1. Management 2. Market 3. Competition 4. Product/Technology 5. Ability to Forecast Results 6. Capital Intensity (Risk/Reward)
Management 10 1 Senior Team Proven Record No Operating Experience • Good Teams have: • Done their jobs before (no OJT) • Experienced ramp from startup to big company • Relevant industry experience & contacts • Specialized expertise and insight • Ability to adapt to change • Brains and hunger
Management • A Good Incomplete Team • Vision • Energy and hunger • Efficient (Not a drain on capital) • Appropriate role for each person • Acknowledges management gaps
Market 10 1 > $1 Billion Growth capacity > 30% Stagnant • Attractive Markets: • Big ($50,000,000 potential) • Target users adopt new products quickly • Customers feel real pain • Customers can be reached economically • The time is (will be) right
Competition 10 1 Potential for Leadership Several Established Players • Leading Companies: • Typically first to market • Leaders define “Market” • Leaders get market share • Market share critical to success
Product/Technology 10 1 Clearly Superior Providing Leverage No Advantage • Difficult to replicate • Special technical skills required • Special user knowledge required • Proprietary technology (patents) • Many man-months to develop (time, $) • Improves rapidly with customer feedback
Ability to Forecast Results 10 1 High Low • Great companies create and execute operating plans: • Plan is financial expression of strategy • Defines business model • Shows interrelation of timelines, functions, hires • Reflects detailed understanding of the business
Capital Intensity 10 1 Low High • A function of: • Start-up and working-Capital needs (Risk) • Gross margins (Reward) • Sales and marketing expenses (Potential to deflate margins)
No Single Recipe A B C 1 10 1. Management 2. Market 3. Competition 4. Product/Technology 5. Ability to Forecast Results 6. Capital Intensity
Real World Feedback • Interview: • Customers, Analysts, Potential hires, • Potential partners, Other CEOs • Where is the pain? • Would you buy? • How many? • At what price? • How do you buy? • What could we do better? • Listen for what you don’t want to hear
Venture Capital Financing Today Innovation and Entrepreneurship Panel University of Massachusetts at Amherst 24 October 2009
Venture Funding in theCurrent Environment Early stage companies that require relatively small amounts of capital to reach positive cash flow, with low valuations are getting funded
LENDERS: No Risk Low Return EQUITY INVESTORS: Low Risk High Return Objective of Investors
Variables Affecting the Curve External factors: Economy–Capital available –Confidence–CompetitionInternal Factors: Hot New Tech – Serial Entrepreneur – Mega Potential
