Day 1 Evening - Vicary


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Day 1 Evening - Vicary

  1. 1. Practicing with VC Money May 2009 © Surve Inc. | Restricted and Confidential
  2. 2. Age – 32, Age – 42, Age – 48, Dave’s résumé BNR Nortel Nakina Surve Live – Hard Live – Hard Live – Hard Play – Hard Play – Hard Play – Hard Work – Hard Work – Hard Work – Hard Age – 27, Age – 19, high University again LTW school Live – Hard Live – Hard Results Results Plans Play – Hard Play – Hard Led a team Raised No VC Work – Hard of 600 on 3 millions in financing Work – Not so hard Age – 22 University continents financing New Live – Hard Cut team to Brought in business Play – Hard 150 millions in model Results revenues Work – Not so hard Resigned Angel Results Graduated top of Fired investment class opportunity kicked out of three OOPS high-schools BNR here I Results come A&P here I come Forced to take a High tech degree Married, divorced Full-time A&P Part-time UWO Building a serial entrepreneur? 2 © Surve Inc. | Restricted and Confidential
  3. 3. Lessons learned 1. Live hard, play hard, work hard – Experience is the best teacher • I may be a little slow to learn 2. Take advice with a grain of salt – Recommended readings – Business Philosophy • The Prince – Machiavelli • The Art of War – Sun Tzu 3. Understand your risk tolerance – Only risk I worry about is the risk of stagnation Know your strengths, weaknesses, and desire 3 © Surve Inc. | Restricted and Confidential
  4. 4. Sun Tzu – The Art of War Knowing the other and knowing oneself, In one hundred battles no danger. Not knowing the other and knowing oneself, One victory for one loss. Not knowing the other and not knowing oneself, In every battle certain defeat …and know the terrain 4 © Surve Inc. | Restricted and Confidential
  5. 5. Geographic Perceptions The Bay Area Startup The Ottawa Startup Business acumen – A Business acumen – B Technology acumen – B Technology acumen – A The Venture Capitalist The Venture Capitalist Top Quartile Novice and unproven Incentive to win Incentive not to lose Go-to-market Go-to-market Prototype the concept Develop the product Market the concept Test/refine the product Refine the product Introduce the product True or false – perception is reality 5 © Surve Inc. | Restricted and Confidential
  6. 6. Canadian VC Performance Canadian Horizon Returns 1 YR 3 YR 5 YR 10 YR •Canadian horizon returns are negative on all horizons Canada -3.9 -9.9 -11.5 -3.0 •On a 10 year horizon, Canada lags the US S&P TSX 15.9 11.5 -0.6 8.1 by more than 30% and the EU by nearly 10% 2006-07-02 Canadian industry performance influenced by: – Industry is young and timing has been unfavorable – Selection process to direct the money to good managers not efficient – Many funds are (too) small – Capital allocation by stage is inefficient and financings are too small – Companies not driven to large exits –We need to build strong companies by global standards Gilles Duruflé Myth busting – VC money is smart money 6 © Surve Inc. | Restricted and Confidential
  7. 7. Costs as measured by: The Cost of Money • Expected return • Control of the company Soprano's Lending VC Services Return on Investment Find a better way Cost of Money – Change the business model – Reduce the Time to Market Debt Financing – Cut the “Proof of Concept” costs Angel Friends Government & Personal Family Finances Time to Market Time to ROI 7 © Surve Inc. | Restricted and Confidential
  8. 8. The Founder’s Dilemma Financing commitments: Founder’s Importance – Build a product – Build a team – Build a customer base – Build revenues – Build a business And if you are successful …work yourself out of a job Initial financing secured Company Maturity 8 © Surve Inc. | Restricted and Confidential
  9. 9. VC Discussions The Opportunity The Technology The Team The Plan The Venture Capitalist The Entrepreneur Objective Objective make as much money as possible in as short maintain as much control as possible such a time as possible with as little risk as that you can build a company and realize possible a vision. Making some money along the Common statements way would be great too. 5. We invest in people You should ask 6. You need more money 5. Do you have money to invest 7. We will leverage our connections 6. Do you invest in this area 8. Who else is interested 7. What is your average investment Know yourself, know the investor, you win 9 © Surve Inc. | Restricted and Confidential