Fundraising Hacks: Raise More Capital Faster for Your Company

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Fundraising Hacks: Raise More Capital Faster for Your Company

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Fundraising Hacks: Raise More Capital Faster for Your Company

  1. 1. © 2016 David Teten. More at teten.com http://www.flickr.com/photos/roblee/133498854/ David Teten teten.com // @dteten Fundraising Hacks: Raise More Money Faster photo by Aaron Patterson, http://www.flickr.com/photos/40875537@N04/5659908590/
  2. 2. © 2016 David Teten. More at teten.com David Teten • Partner, ff Venture Capital, early-stage technology venture capital fund, one of the best performing seed- and early-stage venture capital firms in the U.S. • Previously serial entrepreneur and technology investment banker • Advised clients such as Goldman Sachs Special Situations Group, Icahn Enterprises, LLR Partners ($1.4b fund), Birch Hill Equity Partners (C$2B fund), and other institutional investors • Harvard MBA 1998, Yale BA, both with honors. • Teten.com / @dteten
  3. 3. Intro Social Media Network Next Steps © 2016 David Teten. More at teten.com Tradition Don’t Take Notes! Download these slides, sign up for updates, and get more free resources at: teten.com/rc
  4. 4. Intro Social Media Network Next Steps © 2016 David Teten. More at teten.com Tradition • Introduction • Traditional Methods • Social Media • Capital Network • Next Steps
  5. 5. Intro Social Media Network Next Steps © 2016 David Teten. More at teten.com Tradition The Butterfly and the Entrepreneur Egg http://www.mesc.usgs.gov/butterfly/butterfly-life-cycle.html Caterpillar Chrysalis Breakout Butterfly
  6. 6. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com • Introduction • Traditional Methods • Social Media • Capital Network • Next Steps
  7. 7. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.comStudy of 2,501 portfolio managers of 1,648 actively managed equity funds that specialized in aggressive growth, growth, or growth and income stocks between January 1990 and December 2006 Source: The Small World of Investing: Board Connections and Mutual Fund Returns; Lauren Cohen, Andrea Frazzini, and Christopher Malloy, 2008 Connected Holdings=Stocks for which managers had the strongest connection to senior officials (same school at same time with same degree) Excess return=total gain minus the Treasury bill return Investors earn higher returns by investing in people they know. Mutual Fund Managers’ Excess Returns in Companies Run by College/Graduate School Classmates vs. All Other Companies
  8. 8. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com Traditional Capital-Raising Methods Personal networks of principals “Friends, family, and fools” Direct outreach Can work well, but only through introduction Advisory board Be careful about paying a fee of any kind Conferences/ industry associations Legal ways to market broadly Communications with existing relationships Monthly mail with your metrics Business relationships with potential investors Existing/potential customers are the best
  9. 9. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com • Introduction • Traditional Methods • Social Media • Capital Network • Next Steps
  10. 10. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com http://www.flickr.com/photos/23439761@N03/3258313816/sizes/l/ Social media allows you to convert cold calls to warm calls.
  11. 11. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com “Social media is a communications medium that relies on its audience to create, modify, or distribute the medium’s content - Nick Gonzalez, SocialMedia.com http://www.flickr.com/photos/briansolis/2735401175/sizes/l/, http://blog.socialmedia.com/how-should-we-define-social-media/. /
  12. 12. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com Why should I care about social media for raising capital? • Because 3 out of 4 Americans use social technology. (Forrester, The Growth Of Social Technology Adoption, 2008) • 2/3 of global internet population visit social networks (Nielsen, Global Faces & Networked Places, 2009) • Visiting social sites is now the 4th most popular online activity—ahead of personal email. (Nielsen, Global Faces & Networked Places, 2009) • Visitors spend 5 million minutes per day on Facebook. (Facebook) http://www.slideshare.net/mzkagan/what-is-social-media-2005829 . http://www.flickr.com/photos/sreejithk2000/2385193167/sizes/l/
  13. 13. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com But I don’t use social media, and neither do (some of) my targets! • The reality: you and your target investors are in the social media matrix whether you like it or not. • Your potential investors search for you on Google before doing business with you. • You are already a member of gated online communities, which you may or may not be fully leveraging: your alumni network, your local “Moms” or “Dads” mailing list, your church/synagogue/mosque • You can accelerate your sales process by leveraging potential candidates’ digital footprints. These help you to source leads, filter them, and then run a better educated sales process. http://www.slideshare.net/mzkagan/what-is-social-media-2005829 . http://www.flickr.com/photos/sreejithk2000/2385193167/sizes/l/
  14. 14. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com • Introduction • Traditional Methods • Social Media • Capital Network • Next Steps
  15. 15. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Investor Network Valuation Formula David Teten and Scott Allen, The Virtual Handshake: Opening Doors and Closing Deals Online (www.TheVirtualHandshake.com) Ch = Character Co = Your Firm’s Competence R = Relevance of the contact S = Strength of your relationship I = Information N = Number of people D = Diversity = D * ∑ (Chn*Con *Rn* Sn*In) N n=1
  16. 16. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Always Be Closing Alec Baldwin in Glengarry Glen Ross http://www.onlygoodmovies.com/blog/thoughts-on-film/glengarry-glen-ross-my-favorite-movie-scenes/
  17. 17. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Balance Strength vs. Number Average Strength = Minutes Available / Person Number = # People therefore… Average Strength * Number = Total Minutes Available vs.
  18. 18. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Biography analysis software allows you to search by common affinity and more effective subsequent outreach. • Boardex • Klout* • LinkedIn • Pipl • Relationship Science • ZoomInfo Leading Providers of Biography Analysis Data * ffVC portfolio company
  19. 19. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com • Daniel Zumino, founder of BCG Paris and angel investor, had made a small investment in a startup • He sent email to Stanford GSB alumni list seeking capital for the startup • Raised $8m through referral from alumni, via this listserv David Teten and Scott Allen, The Virtual Handshake: Opening Doors and Closing Deals Online (www.TheVirtualHandshake.com) Case study: Entrepreneur raised $8m from an alumni email list
  20. 20. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Cash is a market signal * ffVC portfolio company Interaxon* Campaign on Indiegogo*
  21. 21. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Corporate analysis software provides an insider view of the org chart and compensation of a company. Leading Providers of Corporate Analysis Data • Capital IQ • CogMap • LexisNexis Corporate Affiliations • Salesforce Data.com • Glassdoor • TheOfficialBoard • ReferenceUSA
  22. 22. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com • Phone • Email • Web conferencing • Instant messaging • Internet telephony (e.g., Skype) • SMS • Twitter Using multiple media channels promotes stronger trust- building Caroline Haythornthwaite, “Strong, Weak, and Latent Ties and the Impact of New Media,” The Information Society, 18 ( 2002) 385–401. http://flickr.com/photos/re-ality/41676755/sizes/o/ Major Media Channels for Origination (descending order of importance)
  23. 23. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Effective capital-raisers are data hounds Tools for Assimilating Data into Your Contact Relationship Management (CRM) System Data source Selected technology for inserting data into CRM Cards FullContact Data Enrichment Avention, ClearBit, Cloze, Data.com, Discover.ly, Evercontact, Introhive, LeadIQ, Plaxo, Ringlead, Salestools.io, SalesOps, VibeApp, DiscoverOrg Other LinkedIn Full CRM Microsoft Dynamics, Salesforce, SalesforceIQ, Act, Base, many others
  24. 24. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Selected Searchable Databases of Private Equity and VC Funds You can identify potential co-investors through any of multiple online databases. All Investors Private Equity Venture Capital • Galantes • Grey House • LP Source • Pratt’s Guide • VentureXpert • Asia PE Research • Eurekahedge • Pitchbook • PrivateEquityFirms.com • ThompsonOne PE Module • Angel List * • CB Insights • CrunchBase * • PWC MoneyTree • LinkedIn * • TheFunded * • VentureDeal • Asian VC Journal • Venture Source * Has the most data for free
  25. 25. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Monitor social media activity around your company and its potential investors and competitors with Bottlenose* * ffVC portfolio company
  26. 26. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Identify thought leaders in your sector with Klout*. *ffVC portfolio company
  27. 27. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Track VC Investing (a lagging indicator) • CB Insights • Crunchbase • Techcrunch • Mashable • Mercurynews.com/vc • Venturebeat
  28. 28. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Major Gated Communities for Investors Investors are connecting with one another via online gated communities; get in their door Angel Group Platforms Angel Communities Consumer Loans Private Equity Public Gust AngelList LendingClub Association for Corporate Growth Albourne Village Proseeder CircleUp Prosper Axial FT Alphaville Long Room FundersClub Intralinks Deal Nexus Sum Zero OurCrowd MergerMarket Value Investors Club SeedInvest
  29. 29. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com • Yahoo Groups • Google Groups • LinkedIn Online Community Platforms • Ning • Xing Every special interest group has an online community
  30. 30. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Senior executives prefer to interact online behind barriers, just as they do in face-to-face networks Sample Gated Communities for Executives • Sermo• Int’l Exec’s Resources Group • Executive Forum (CT)
  31. 31. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Business Plan Competitions • Bizplancompetitions.com • Younoodle • F6s http://flickr.com/photos/extranoise/169187125/sizes/l/
  32. 32. Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Intro Social MediaTradition © 2016 David Teten. More at teten.com Target investors who are one step removed from you • By geography • By industry • By personal characteristics http://flickr.com/photos/extranoise/169187125/sizes/l/
  33. 33. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com • Introduction • Traditional Methods • Social Media • Capital Network • Next Steps
  34. 34. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com Step 1: Google Yourself
  35. 35. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com Step 2: Be a Data Hound http://www.flickr.com/photos/sookie/94778946/
  36. 36. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com Step 3: Reduce Email Use
  37. 37. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com Step 4: Join the Right Club
  38. 38. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com Step 5: Find People to Meet Online
  39. 39. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com Any questions ? Slides at teten.com/rc Sign up for updates at teten.com @dteten
  40. 40. Network Next StepsIntro Social MediaTradition © 2016 David Teten. More at teten.com →A representative of ff Asset Management, LLC d/b/a ff Venture Capital (“ffVC”) is providing this presentation for informational purposes to the intended audience. Nothing in this presentation shall constitute an offer or solicitation with respect to the purchase or sale of any security in any jurisdiction nor should anything in this presentation form the basis of, or be relied upon for, making any investment decision. Nothing in this presentation constitutes professional and/or financial advice of any kind (including business, employment, investment advisory, accounting, tax, and/or legal advice), nor does any information in this presentation constitute a comprehensive or complete statement of the matters discussed or the law relating thereto. This presentation and the information contained herein are provided “AS IS”. ffVC makes no representation or warranty (express or implied) with respect to the information contained herein (including, without limitation, information obtained from third parties) and expressly disclaims any liability based on or relating to the information contained in, or errors or omissions from, these materials; or based on or relating to the recipient’s use (or the use by any of its affiliates or representatives or any other person) of these materials; or based on any other written or oral communications transmitted to the recipient or any of its affiliates or representatives. ffVC undertakes no duty or obligation to update or revise the information contained in this presentation. Disclaimer

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