Jordan Green @ Transmedia Victoria

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"About Angel Investors for Transmedia Businesses" was presented at, Jan 27th 2011

"About Angel Investors for Transmedia Businesses" was presented at, Jan 27th 2011

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  • 1. About Angel InvestorsforTransmedia Businesses
    Presented by: Jordan Green
    Melbourne Angels, President/Founder
    AAAI, Deputy Chairman/Co-Founder
  • 2. A Little About Angel Investors
    An Angel is a person who invests his/her own money and time in an unlisted growth company as a personal decision with the objective of realising a capital return in the foreseeable future.
    Financial Capital + Intellectual Capital
  • 3. Where’s the money?
    Funding Choices:
    Family, Friends & Fools $10,000’s
    Banks $10,000-100,000’s
    Strategic Investors $10,000-1,000,000’s
    Angel Investors $10,000-100,000’s
    Venture Capital $1,000,000’s
    Private Investors $10,000-1,000,000’s
    Private Equity $100,000-1,000,000’s
    IPO $1,000,000-10,000,000’s
    Where Angels Fit In
    2008:20 New Deals<$60m
    2009:10 New Deals<$25m
    2010:10 New Deals<$25m
    Source: AVCAL Yearbooks
    Angels in Australia in 2009*
    • 12 Angel Groups (4 more in development)
    • 4. ~16,000 active Angels in Australia
    • 5. $1.4b invested in over 5,000 companies
    • 6. 26,500 jobs fuelled by Angel investment
    *AAAI National Angel Survey 2009
  • 7. A Little About Angel Investors
    The Role of the Angel Investor
    Early stage funding
    Mentor and coach
    Business acumen and governance
    Network of professional advisors, other Angels and other capital
    Sector knowledge and connections to potential customers, suppliers, personnel and acquirers
    Design and facilitate exit
  • 8. A Little About Angel Investors
    Investment Goals
    10x or better return on investment
    3-5 years to exit
    Scalability of large markets, often foreign
    Strong alignment with entrepreneur
    Focus on value growth rather than dividends
    Angels are individuals – it depends!!
  • 9. Deal Flow
    Personal & Personnel
    Intellectual Property
    Business Model
    Terms Sheet
    Due Diligence
    Manage Investment
    3-6 months
    2-8 weeks
    1-6 years
    3-6 months
    Investment Process
  • 10. Valuing Early Stage Opportunities
    ‘Value is in the eyes of the beholder’
    Customers buy benefits
    Investors invest in the future
    Management is as important as design expertise
    Have a plan - certainty for customers & investors
    Capital Efficiency - Incremental vs. Big Bang
    Intellectual Capital is ultimately worth more than Intellectual Property
    Design expertise/reputation
    Industry knowledge/access
    Market knowledge/access
    Technology knowledge/access
  • 11. Two Types of Business Value
    Growth Business
    [Value to Sell]
    Lifestyle Business
    [A Job for Life]
    Critically dependent on entrepreneur
    Low and slow to competitive advantage
    May take many years to stabilize and achieve scale
    ROI may be small given low potential valuations relative to time and risk
    Cash flow and/or customers are valuable to an acquirer
    Capital captive
    Business with sustainable value independent of entrepreneur
    Invest in IP to create competitive advantage
    Aggressive growth
    Assets or competencies or customers or cash flow are valuable to an acquirer
    Capital returns
  • 12. How to Approach Opportunity
    Know yourself
    Is your business suitable for an investor?
    Is your business an appealing investment?
    Can you work with a business partner?
    Can you share control?
    For which investor is your investment opportunity best suited?
    Would you invest?
  • 13. How to Approach Opportunity
    Be Prepared
    Plan a path forward
    Have the skills and tools to navigate the inevitable detours
    Know what to expect
    Know when to walk away
    Know yourself
  • 14. Transmedia – the challenge!
    Average Angel investor is over 45
    Technical background but, not current
    Business background but, not web
    Eyeballs not saleable value on their own
    Investor is not the user
    Transmedia is industry convergence, makes exit value & targets harder
    No transmedia success stories/track record
  • 15. Transmedia – the opportunity!!
    Emerging markets
    Low barriers to business entry
    No dominant player(s)
    Value built across established industries
    Value in product not advertising
    Technically innovative
    Commercially agile
    Sparks the imagination – it’s exciting!!
  • 16. Thank you ….
  • 17. A Little About Angel Investors
    An Angel Group is a collection of individual Angel Investors who combine under a common brand with defined rules of membership and conduct to collectively identify, review, select, evaluate, invest in and exit from Angel investments.
  • 18. Why join an Angel Group?
    Deal Flow
    Process, Discipline, Best Practices
    Risk mitigation
    Diversification by volume
    Diversification by scope