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You Don’t Get $1M in Funding with a Half-Baked Business Plan!

You Don’t Get $1M in Funding with a Half-Baked Business Plan!. What deals get funded. Balance between risk & return Right valuation, team, market An investor gets it! Proven track record Investor can believe in Jockey Knowledge of the Space Superior investment to all other alternatives.

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You Don’t Get $1M in Funding with a Half-Baked Business Plan!

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  1. You Don’t Get $1M in Funding with a Half-Baked Business Plan!

  2. What deals get funded • Balance between risk & return • Right valuation, team, market • An investor gets it! • Proven track record • Investor can believe in Jockey • Knowledge of the Space • Superior investment to all otheralternatives

  3. It’s about Relationships • Simple Formula: • Strength of Relationship x Traction = Probability of Success • -Paul Allen

  4. It’s about Relationships & Traction… Strength of Relationship 10 8 6 2 3 7 Company Traction 10 8 4 6 10 1 Success Ratio 100 64 24 12 30 7

  5. Fundraising Process • Initial Screening (Intro., EP, ES) • 40% pass rate (100  40) • Meetings with the Entrepreneur • 30% pass rate (40  12) • Due Diligence & Negotiation • 40% pass rate (12  5) • Investment • 50% pass rate (5  2.5) Result 2.5% customers

  6. Risk vs. Return Idea is Feasible Beta/1st Customer Model is defined & proven Risk Expansion $ Valuation Ship $ Best times to raise capital R&D $ Seed $

  7. Not being half-baked “The Big 3” Executive Summary Financial Model PowerPoint Pitch

  8. The PowerPoint Pitch • 12 yr. old rule • Guy Kawasaki’s 10/20/30 rule • Selling Company, not Product (Make sure to have an elevator pitch)

  9. Pitching Tips Strong, but simple opening Market Need (problem) & Business Model (solution) Market Overview Product & Service Overview Competition & Competitive Advantages

  10. Pitching Tips Cont’d • Strategic Partners, Customers • Management Team • Accomplishments/Milestones • Funds Sought/Use of Funds • Financial Projections

  11. Key Consideration • YOU! Be prepared to impress… • Keys to angel investments: • Passion • Integrity • Good Luck!

  12. The TRUTH… • … about business plans: • Entrepreneurs hate writing them & investors hate reading them! • Executive Summary: 2-5 pages (definitely less than 10)

  13. What Should it Include? • Problem/Solution • Market Overview • Product Overview • Traction/Milestones • Mgt. Team/Key Advisors • Financial Details/Deal Terms

  14. The Financial Model • Fully integrated with… • Sales Assumptions • Income Statement (P&L) • Cash Flow Statement • Balance Sheet • Head Count/Salary • Cap. Table

  15. Financial Model: Example Month-to-month projections over the next 3-5 years Includes: Income statement, Balance Sheet, Cash Flow Statement, Sales Assumptions, Cap Table, etc.

  16. Sales Assumptions

  17. Investment Landscape UT • 7 angel groups • Dozen of VCs • 100’s of private angels

  18. Funding • 5.6Mnew start-ups/year • 1.9M seeking funding • Only 50k successful raising capital 97% need help – don’t be a statistic! Source: Center for Venture Research

  19. We’re passionate about helping early stage entrepreneurs prepare for and get access to funding. Brock Blake, CEO bblake@fundinguniverse.com www.fundinguniverse.com

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