Funding entrepreneurship cj cornell-cronkite-november 14th 2012

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Presentation / Lecture to the ASU Walter Cronkite School of Journalism & Mass Communication on Funding Entrepreneurship & Crowdfunding

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  • Spear … snake … WALL … tree … rope .. FAN(ear)"The Blind Men and the Elephant." = by 19th-century American poet John Godfrey SaxeIt was six men of IndostanTo learning much inclined,Who went to see the Elephant (Though all of them were blind),That each by observation Might satisfy his mind.The First approached the Elephant, And happening to fallAgainst his broad and sturdy side,At once began to bawl:"God bless me! but the ElephantIs very like a wall!"The Second, feeling of the tusk,Cried, "Ho! what have we hereSo very round and smooth and sharp? To me 'tis mighty clearThis wonder of an Elephant Is very like a spear!"The Third approached the animal,And happening to takeThe squirming trunk within his hands,Thus boldly up and spake:"I see," quoth he, "the Elephant Is very like a snake!" The Fourth reached out an eager hand, And felt about the knee."What most this wondrous beast is likeIs mighty plain," quoth he;"'Tis clear enough the ElephantIs very like a tree!"The Fifth, who chanced to touch the ear, Said: "E'en the blindest manCan tell what this resembles most; Deny the fact who canThis marvel of an ElephantIs very like a fan!"The Sixth no sooner had begun About the beast to grope,Than, seizing on the swinging tailThat fell within his scope,"I see," quoth he, "the Elephant Is very like a rope!"And so these men of IndostanDisputed loud and long,Each in his own opinion Exceeding stiff and strong,Though each was partly in the right,And all were in the wrong!
  • Funding entrepreneurship cj cornell-cronkite-november 14th 2012

    1. 1. Funding EntrepreneurshipC.J. Cornell @cjcornell
    2. 2. Small Business High-Growth Startups Social Impact Ideas -> Patents, IP etc INtrapreneurship
    3. 3. Defining EntrepreneurshipACTIVITIES RESOURCES RESULTS
    4. 4. Type of Desired/Expected Activities Resources Required /Entrepreneurship Outcome AvailableSmall Business Paycheck(s), Personal Business Operations: Personal Funds, Bank Loans,(merchant, consultant, Satisfaction (lifestyle) Legal establishment, SBA Assistance. “organic”freelancer, franchisee) managing employees etc. (revenue funding)Innovation Patents, IP, Tech Institutional research, Government/Public Funding.(Scientist, researcher, Transfer, Royalties Documentation of IP Foundation and special privateinventor, artist …) (patron) fundingIntrapreneurship Large company “working the system”, Internal, corporate resources,(manager, employee) growth, new aligning allies, persuading funding products, new stakeholders processes…Social Solving or Impacting Marketing, petitioning, Foundation funding.Entrepreneurship “causes” & societal organizing. “empowering” Charitable/fundraiding.(activist, advocates, issues. Awareness. others to do the same. Patrons. Public funding.patrons) Behavior change.“Vanguard” Growth; market Rapid concept to product, Personal funds.Entrepreneurship making,.“Scalability”. to market. “pitching”, Angel funding(technologists, ‘silicon Rapid Market business models, acquiring Venture capitalvalley’, opportunists, domination. “users” – particularly early IPOdreamers) Wealth – personal adopters and influencers. and ‘community’
    5. 5. Type of Desired/Expected Activities Resources Required /Entrepreneurship Outcome AvailableSmall Business Funding Paycheck(s), Personal Business Operations: Personal Funds, Bank Loans, Satisfaction (lifestyle) Legal establishment, SBA Assistance. “organic” Entrepreneurship etc. managing employees (revenue funding)Innovation Patents, IP, Tech Institutional research, Government/Public Funding. Transfer, Royalties Documentation of IP Foundation and special private (patron) fundingIntrapreneurship Large company “working the system”, Internal, corporate resources, growth, new aligning allies, persuading funding products, new stakeholders processes…Social Solving or Impacting Marketing, petitioning, Foundation funding. “causes” & societal organizing. “empowering” Charitable/fundraiding. issues. Awareness. others to do the same. Patrons. Public funding. Behavior change.“Vanguard” Growth; market Rapid concept to product, Personal funds. making,.“Scalability”. to market. “pitching”, Angel funding Rapid Market business models, acquiring Venture capital domination. “users” – particularly early IPO Wealth – personal adopters and influencers. and ‘community’
    6. 6. Type of Desired/Expected Activities Resources Required /Entrepreneurship Outcome AvailableSmall Business Funding Paycheck(s), Personal Business Operations: Personal Funds, Bank Loans, Satisfaction (lifestyle) Legal establishment, SBA Assistance. “organic” Entrepreneurship etc. managing employees (revenue funding)Innovation Patents, IP, Tech Institutional research, Government/Public Funding. Transfer, Royalties Documentation of IP Foundation and special private (patron) fundingIntrapreneurship Large company growth, new products, new WHY “working the system”, aligning allies, persuading stakeholders Internal, corporate resources, funding processes…Social Solving or Impacting Marketing, petitioning, Foundation funding. “causes” & societal organizing. “empowering” Charitable/fundraiding. issues. Awareness. others to do the same. Patrons. Public funding. Behavior change.“Vanguard” Growth; market Rapid concept to product, Personal funds. making,.“Scalability”. to market. “pitching”, Angel funding Rapid Market business models, acquiring Venture capital domination. “users” – particularly early IPO Wealth – personal adopters and influencers. and ‘community’
    7. 7. ACTIVITIES RESOURCES RESULTS
    8. 8. Type of Desired/Expected Activities Resources Required /Entrepreneurship Outcome AvailableSmall Business Paycheck(s), Personal Business Operations: Personal Funds, Bank Loans, Satisfaction (lifestyle) Legal establishment, SBA Assistance. “organic” managing employees etc. (revenue funding)Innovation Patents, IP, Tech Institutional research, Government/Public Funding. Transfer, Royalties Documentation of IP Foundation and special private (patron) fundingIntrapreneurship Large company “working the system”, Internal, corporate resources, growth, new aligning allies, persuading funding products, new stakeholders processes…Social Solving or Impacting Marketing, petitioning, Foundation funding. “causes” & societal organizing. “empowering” Charitable/fundraiding. issues. Awareness. others to do the same. Patrons. Public funding. Behavior change.“Vanguard” Growth; market Rapid concept to product, Personal funds. making,.“Scalability”. to market. “pitching”, Rapid Market business models, Angel funding domination. acquiring “users” – Venture capital Wealth – personal particularly early adopters IPO and ‘community’ and influencers.
    9. 9. The Funding Gap
    10. 10. Concept to Product to Growth
    11. 11. Concept to Product to Growth $ $ $ $
    12. 12. Concept to Product to GrowthEntrepreneur IPO $
    13. 13. Concept to Product to GrowthEntrepreneur IPO $ VentureEntrepreneur Capital IPO $ $
    14. 14. Concept to Product to GrowthEntrepreneur IPO $ VentureEntrepreneur Capital IPO $ $ Angels, VentureEntrepreneur accel & incub Capital IPO $ $ $
    15. 15. Concept to Product to Growth Angels, VentureEntrepreneur accel & incub Capital IPO $ $ $ $ $ Crowdfunding
    16. 16. Concept to Product to Growth Angels, VentureEntrepreneur accel & incub Capital IPO $ $ $ $ $ $ Crowdfunding Crowdfunding
    17. 17. Concept to Product to Growth Angels, VentureEntrepreneur accel & incub Capital IPO $ $ $ $ $ $Crowdfunding $ Crowdfunding Crowdfunding
    18. 18. Concept to Product to Growth Angels, VentureEntrepreneur accel & incub Capital IPO $ $ $ $ $ $Crowdfunding $ Crowdfunding Crowdfunding Crowdfunding $
    19. 19. CrowdfundingSoliciting & Collecting relatively small amounts of money (funding) from a large number (crowd) of people
    20. 20. What is Crowdfunding• Derived from Collective Intellgence• Convergence of ecommerce, venture funding, social media, social networking• Online and Offiline• Debt, donation, equity and other• ROI, ROE
    21. 21. What is Crowdfunding
    22. 22. What is Crowdfunding
    23. 23. What is Crowdfunding
    24. 24. What is Crowdfunding
    25. 25. What is Crowdfunding
    26. 26. What is Crowdfunding
    27. 27. What is Crowdfunding
    28. 28. What is Crowdfunding
    29. 29. Crowdfunding Concepts• Debt Crowdfunding – microloans – P2P lending• Donation Crowdfunding – Charity/Causes – Kickstarter Model – Rewards Based – Pre-Order/Presumer• Equity Crowdfunding – JOBS act
    30. 30. Equity Crowdfunding - JOBS• Eliminates ban on general solicitation and general advertising in connection with private offerings to accredited investors under Regulation D (Rule 506) and to qualified institutional buyers under Rule 144A.• Exemption from Securities Act registration “crowdfunding” transactions (involving access to small amounts of capital through the internet).• Exemption to allow issuance of up to $50 million of securities in any 12-month period, up from the current $5 million threshold• An increase in the number of shareholders a company may have before being required to register its common stock with the SEC and become a public reporting company from 500 to 2,000 total shareholders (including up to 500 “unaccredited” shareholders)• Amount each person may invest in offerings of this type, tiered by the persons net worth or yearly income.
    31. 31. Rewards-based, Donation Crowdfunding:“THE KICKSTARTER MODEL”
    32. 32. ALL OR NOTHING
    33. 33. Perks &Rewards
    34. 34. Updates (and Blogging)
    35. 35. Updates (and Blogging)
    36. 36. Comments & Engagement
    37. 37. Rewards-based, Donation Crowdfunding:REWARDS & PERKS = “WHY”
    38. 38. Rewards-based, Donation Crowdfunding:PRE-ORDER / PRESUMERS …
    39. 39. Rewards Crowdfunding • Incentives & perks • Pre-Orders • Pre-Sumers • Market Validation
    40. 40. Rewards don’t have to worth $$
    41. 41. Rewards-based, Donation Crowdfunding:SO, WHY WOULD ANYONE …??
    42. 42. American Grandmaster a Patrick Million FILM Directed by Patrick Million Executive Producer CJ Cornell
    43. 43. WHY Crowdfunding?• Passion – For the technology – For the industry – For the cause – For the product• Affinity – For the Entrepreneur – For the region, industry etc• Connection• Every reason BUT R.O.I. …
    44. 44. Lessons from Ethan Mollick’s “The Dynamics of Crowdfunding: Determinants of Success and Failure”
    45. 45. emotional rate of return. Not financial ROI
    46. 46. The Kickstart Model..UH OH …
    47. 47. Crowdfunding sites• Kickstarter • Equity Crowdfunding• Indiegogo sites (not legal, not• operating)•• • Specialty niche Crowdfunding sites•• Propel Arizona • Micro loan, cause/charity funding sites.
    48. 48. HOW to Crowdfund?1. PRE - Preparing2. PUSH - Running the campaign3. POST – Delivering on your Promise
    49. 49. HOW to Crowdfund?1. PRE - Preparing – Build Credibility – Sharpen Pitch & Post – Perks and Rewards – Timefames & $$
    50. 50. HOW to Crowdfund?PUSH - Running the campaign• Social Media• Comments & Updates• Networking• Personal Pitches
    51. 51. Social Engagement– Transparency & Trust– Social Proof & Viral FX – Engagement & “The Fundamentals” – Twitter – Facebook – Blogging
    52. 52. HOW to Crowdfund?POST - campaign• Thanks …• Perks and rewards• Updates• Completing your goals !!
    53. 53. Introducing … Crowdfunding Arizona Entrepreneurs Jumpstarting Innovation & Economic Growthwww. propelarizona.com
    54. 54. • Brave Souls• White Knights• Superstars• Supernovas• Etc …
    55. 55. • Pitch Events• Contests• Workshops• Mentoring
    56. 56. www. propelarizona.com

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