10 Key Lessons in Applied Entrepreneurial Finance

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10 Key Lessons in Applied Entrepreneurial Finance

  1. 1. 10 Key Lessons in Applied Entrepreneurial Finance
  2. 2. Agenda• Introduction (5 Minutes)• One Word Check-in (10 Minutes)• Entrepreneurial Mindset (20 Minutes)• Entrepreneurial Finance (25 Minutes)• Questions and Answers (30 Minutes)• One Take Away (20 Minutes)
  3. 3. Introduction: Jonathan B. Smith•Founder - ChiefOptimizer•Professional – Big 6 Accounting – Wall Street – Serial Entrepreneur•Education – Michigan State University – Certificate in Homeland Security – University of Hartford – MS Accounting – Wesleyan University – BA Social Studies•Community – Entrepreneur’s Organization – Joint Civilian Orientation Conference (JCOC 84) – Leader Dog for the Blind – State Department Ambassador for Entrepreneurship•Awards – 2007 Inc 500 Winner (#203) Wave Dispersion Technologies – The Leukemia and Lymphoma Society - National Man of the Year – Multiple Government Procurement Awards
  4. 4. Agenda• Introduction (5 Minutes)• One Word Check-in (10 Minutes)• Entrepreneurial Mindset (20 Minutes)• Entrepreneurial Finance (25 Minutes)• Questions and Answers (30 Minutes)• One Take Away (20 Minutes)
  5. 5. One Word Check-In
  6. 6. Agenda• Introduction (5 Minutes)• One Word Check-in (10 Minutes)• Entrepreneurial Mindset (20 Minutes)• Entrepreneurial Finance (25 Minutes)• Questions and Answers (30 Minutes)• One Take Away (20 Minutes)
  7. 7. Entrepreneurial Mindset: Energy
  8. 8. Entrepreneurial Mindset: Optimism
  9. 9. Entrepreneurial Mindset: Risk
  10. 10. Entrepreneurial Mindset: Tuition Prototyping • Innovate by iterating quickly • Learn from calculated risks in real time • Teaches more than 1,000 hours pondering Source: www.ideo.com
  11. 11. Entrepreneurial Mindset: Results Those who say it cannot be done, should not interrupt those doing it. Chinese proverb
  12. 12. Entrepreneurial Mindset: Team
  13. 13. Entrepreneurial Mindset: Integrity
  14. 14. Entrepreneurial Mindset: Abundance
  15. 15. Entrepreneurial Mindset: Long Haul
  16. 16. Entrepreneurial Mindset: All
  17. 17. Entrepreneurial Mindset: Simplicity
  18. 18. Entrepreneurial Mindset: Sheer Will
  19. 19. Agenda• Introduction (5 Minutes)• One Word Check-in (10 Minutes)• Entrepreneurial Mindset (20 Minutes)• Entrepreneurial Finance (25 Minutes)• Questions and Answers (30 Minutes)• One Take Away (20 Minutes)
  20. 20. Entrepreneurial Finance: Heilmeyer’s Catechism• What are you trying to do? In English, no CorpSpeak• How is it done today, and what are the limits of current practice?• Whats new in your approach and why do you think it will be successful?• Who cares?• If youre successful, what difference will it make?• What are the risks and the payoffs?• How much will it cost?• How long will it take?• What are the midterm and final "exams" to check for success?
  21. 21. Entrepreneurial Mindset: Financing Priorities Variable Inputs ObjectiveResults Build a Successful BusinessLiquidity Sufficient $ to Fund NeedsControl MaintainOwnership RetainProfessional Investor - Strategic Benefits Networking & ExpertiseRisk ShareRewards Share
  22. 22. Entrepreneurial Finance: Cash Flow
  23. 23. Entrepreneurial Finance: Working Capital CycleA good working capital cycle balances incoming and outgoing payments tomaximize working capital. Simply put, you need to know you can affordto research, produce, and sell your product.Source: www.qfinance.com
  24. 24. Entrepreneurial Finance: Motivation
  25. 25. Entrepreneurial Finance: Break Even
  26. 26. Entrepreneurial Finance: Personal Financing
  27. 27. Entrepreneurial Finance: Friends and Family
  28. 28. Entrepreneurial Finance: Customer Financing
  29. 29. Entrepreneurial Finance: Vendor Financing
  30. 30. Entrepreneurial Finance: Angel Financing • Individual investors who invest in businesses seeking higher returns than traditional investments. • Goal to help other entrepreneurs. • Typically a bridge from the Early Stage to the Series A VC Round. • Average funding found $150,000 to $1.5 million. • The term "angel" comes from the practice in the early 1900s of wealthy businessmen investing in Broadway productions.
  31. 31. Entrepreneurial Finance: Factoring
  32. 32. Entrepreneurial Finance: Merchant Account Advance
  33. 33. Entrepreneurial Finance: Government • Taxes – International – Federal – State – Local • International Trade – Duties – Tariffs – Offsets • Economic Development – Abatements – Grants – Incentives – Subsidized Loans
  34. 34. Agenda• Introduction (5 Minutes)• One Word Check-in (10 Minutes)• Entrepreneurial Mindset (20 Minutes)• Entrepreneurial Finance (25 Minutes)• Questions and Answers (30 Minutes)• One Take Away (20 Minutes)
  35. 35. Question and Answers
  36. 36. Agenda• Introduction (5 Minutes)• One Word Check-in (10 Minutes)• Entrepreneurial Mindset (20 Minutes)• Entrepreneurial Finance (25 Minutes)• Questions and Answers (30 Minutes)• One Take Away (20 Minutes)
  37. 37. One Take Away
  38. 38. Thank You Jonathan B. Smith Founder ChiefOptimizer +1(703) 569-1011jonathan@chiefoptimizer.com @chiefoptimizer

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