Show Me the Money: Start-up Accelerators

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Slides from a GA event on Seed Accelerators.

Slides from a GA event on Seed Accelerators.

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  • 1. Session I - Seed Accelerators: “Start-up Scourge or Super-charger?” Monday July 29, 2013 General Assembly Seminar Part of the “Show me the $$$$!” GA event series: Insider perspective on fundraising and entrepreneurship Tom Wisniewski RosePaul Investments Thanks to all who participated at the event last night @ GA NYC and a special thanks to our guest speakers: Kamran Ansari, Greycroft Partners; Brian Cohen, New York Angels ; Charlie Kemper, Entrepreneurs Roundtable Accelerator; Shai Goldman, 500 Startups; Fred Cook, Moveline (TechStars Alum); Jonathon Ende, SeamlessDocs (ERA Alum); Heather Marie, 72Lux (500 Startups Alum) -TW (Thomas@rosepaul.com)
  • 2. confidential 1 Agenda I. Kick-off and Introduction II. Panel with Accelerators (ERA, 500 Start-ups) III. Panel with Investors (Greycroft, NY Angels) IV. [Brief Networking Break] V. Panel with Founders (Moveline, 72Lux, SeamlessDocs) VI. More Networking/ Beverages………
  • 3. confidential 2 I. Kick-Off and Introduction Show me the $$$$! Series: An Insider’s Guide. Monthly series on the critical elements of successful start-up development, fundraising and entrepreneurship. Goal: make it a great, impactful event. Leverage:  Interesting/Meaningful Topics  Present some prepared, well structure content  Get great experienced, successful “insiders” to share there perspective  Include Networking (…and some beer and wine!)
  • 4. confidential 3 Tonight’s Focus  There are a lot of challenges in launching a start-up: the odds appear to be heavily stacked against you. Less than 100:1 will succeed  Its not all about a fantastic idea and great team. Two huge factors: • Getting the necessary guidance, input, and access ….that allow you to refine and build the business • Raising the capital you need. ……..Media can make it look easy, but the reality is: it’s really hard.  Accelerators: Seem to offer the keys to both. • Lots of help: during the program, demo day, after • Capital: Modest investment upfront, some follow-on(?) and….a huge boost in raising capital from Angels/VC’s post program.
  • 5. confidential 4  After B-school: joined a start-up management consulting firm Mitchell Madison Group; focus on Strategy/Operations/IT for financial services, tech, outsourcing, private equity/VC clients (1993 to 2000)  Walker Digital: helped set-up and run an early “internet incubator” (2000)  Independent Advisor / Turn-arounds: Advised VC and PE Firms on portfolio company strategy and new investments; joined the management team of two companies  Currently: • Early stage investor and advisor to start-ups • Member and director at New York Angels  Investor in: • Moveline (Uber for the moving industry) --Techstars Alum; • SeamlessDocs (“Adobe 2.0” internet document sharing) – ERA Alum • DealFlicks ( “Hotel.com” for movie tickets) –500 Start-Ups Alum; …..and ~10 other ventures that didn’t go through Accelerators, Tom Wisniewski: My background  Born in NYC; grew-up in Montclair, NJ  Physics and Philosophy major undergrad (Clark University); MBA at Tuck School (Dartmouth)  1st Job: Programmer at Morgan Stanley then moved to Investment Banking
  • 6. confidential 5 Sources of Investment: Seed Fundraising, Angels and VC’s Stage (Pre-Round): • Expected to have: • You and a pitch. • Well developed pitch • Answers to “b-plan” questions • Some product… • Some traction…. • Significant variation among firms but…. Angel req. +: - More Traction! Clients, users/stats, more proof. E.g. “$100K monthly revs” - …..Growth potential! $1B Industry, $100M Rev • Don’t Expect: • Product, Traction, Team • Proven business model, product market fit (know it will change) Who/what are they? • People you already know, that trust you • Individuals that are experienced early stage investors • A Firm. A group of professional investors that raises, invests and manages other people’s $ Angel Investment Friends and Family Venture Capital “You” aka Bootstrapped Earlier Stage Later Stage Round Size $: • $10’s of K to $100K • $100’s of K to $1M+ • $500K to $1.5M Investment Size $: $5K – $10’s of K • $25K – $75K • $250K-$750K Valuation (Pre- Mon): • < $1 M • $1 – 5 M • $5-10 M II. Start-up Life-Cycle and Fundraising “Seed” VC “Traditional Series A” VC • $5M-$15M • $3M – $5M • $10 – 25 M “Seed” Where do the Accelerators fit in?
  • 7. confidential 6 Accelerators: Some Stats Stats from Seed-DB (www.seed-db.com): • 171 “Seed Accelerator” Programs world-wide • 2862 companies “accelerated” • $2.5B raised (Includes all subsequent rounds); $1.1B if we exclude Y-Combinator • 148 Exits
  • 8. confidential 7 Name Location Date Founded Accept. Rate Funding Cost Cohort Size Class Timing Class Length Funded to Date Examples of Graduates Y Combinator Mountain View, CA 2005 2% $14K-$20K + $80K note None 82 Jan- Mar, Jun-Aug 3 months 550 Reddit, Scribd, Weebly, Dropbox, Airbnb, Codecademy, 42Floors TechStars Boston, MA; Boulder, CO; Chicago, IL; New York, NY 2007 <1% $18K + optional $100K convertible debt None 8-13 Varies 3 months 162 Filtrbox, IntenseDebat e, MadKast, Socialthing, Localcents, DailyBurn 500 Startups Mountain View, CA 2010 <2% $50K for 5% equity $6K/founder, $3K/non- founder 25-35 Varies (NYC every 9 Mo. ?) 4 months 288 9GAG, InternMatch, 72Lux, Fitocracy Dreamit Philadelphia, PA; Austin, TX; Israel; New York, NY 2008 N/A $5K + $5K for each founding member (up to 4) None 10-15 Varies 3 months 95 MindSnacks, SCVNGR, SeatGeek, Notehall (acquired by Chegg), Entrepreneur's Roundatable Accelerator NY, NY 2011 1% $40K None 10 Jun- Sept, Jan-Apr 4 months 50 TripleLift, Stray Boots, numberFire Accelerators: Some Stats
  • 9. confidential So….what questions do you have? 8  ???
  • 10. confidential Our guest speakers tonight: 9  Kamran Ansari, Greycroft Partners  Brian Cohen, New York Angels  Charlie Kemper, Entrepreneurs Roundtable Accelerator  Shai Goldman, 500 Startups  Fred Cook, Moveline (TechStars Alum)  Jonathon Ende, SeamlessDocs (ERA Alum)  Heather Marie, 72Lux (500 Startups Alum)
  • 11. confidential 10 Thanks! Thomas Wisniewski Contact Info Email: Thomas@RosePaul.com LinkedIn: http://www.linkedin.com/in/thomaswis Twitter: @thomaswis This presentation: http://www.slideshare.net/Thomaswis/ Next event in the SMTM series: Monday September 30th
  • 12. confidential THANKS! 11
  • 13. confidential Extra Slides 12
  • 14. confidential Tom Wisniewski: Investor Profile  Direct “Angel” Investor in Companies • $25K-250K investments; Typical valuations: $1-5 Million, • Typical Stage: at least some “product” done, some customer/sales traction • Sector focus: Opportunistic generally within internet/software space; - fair amount of Saas B2B, and consumer “marketplace” models, ecommerce enablers. - NOT (or not much?): hardware, heathcare/pharma, cleantech • NYC based: 50% investments in NYC area companies; total of ~80% NE overall (e.g Boston, DC), 20% West Coast. • Examples: - Sociocast (social/behavioral big data analytics) - LiveLook (Saas, live collaboration sales/service platform) - Anvato (Ad insertion to live video streaming via proprietary machine vision) - Moveline (Uber for the moving industry) - SeamlessDocs (Saas, paperwork automation; “Adobe 2.0” internet document sharing) - Movio (Digital “RedBox”; content delivery via “last 100 ft” of wifi internet) - HeTexted (Relationship advice forum generating content, media opportunities) - Wanderu (Kayak for ground transportation) - DealFlicks (a “Priceline” or “Hotel.com” for movie theater tickets) - iCharts (tool that enables engaging, sharable, embedible chart content)  Investor in Funds • In addition to direct investments in start-ups, invest in VC and PE funds. • Examples: - Social Starts (Seed fund for start-ups leveraging the Social Web) - Brooklyn Bridge Ventures (Charlie O’Donnell’s fund) - Entrepreneurs Roundtable Accelerator (ERA Fund) - Greycroft Partners (Venture Fund) 13