The Virtual Handshake:
How to Raise Capital with Web 2.0 Technologies
David Teten
Teten.com / TheVirtualHandshake.com
info @ teten.com
1-347-853-7397
New York, NY
http://www.flickr.com/photos/roblee/133498854/
© Teten Advisors, LLC 2008. All Rights Reserved - Privileged and Confidential

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Introduction
Traditional Methods of Raising Capital
Web 2.0
Earmarks of People and Funds You Want to Know
Growing Your "Network 2.0"
Next Steps
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
David Teten Biography
• Currently: independent investment banker (Teten.com),
specializing in advising private equity and venture capital funds on: accelerating deal flow,
portfolio company executive optimization, corporate training, and due diligence
• Managing Director, Evalueserve, through September 2008. 2,500-person research firm.
• Founder and CEO, Circle of Experts (investment research firm), sold to Evalueserve
• Founder and CEO, Teten Executive Recruiting, sold to Accolo, #42 on 2007 Inc. 500
• Founder and CEO, GoldNames, domain name investment bank, based in Israel
• Technology M&A, Bear Stearns
• Lead author, The Virtual Handshake: Opening Doors and
Closing Deals Online (TheVirtualHandshake.com)
• Harvard MBA, Yale BA
• Contact: info @ teten.com
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
“Who You Know”….What is it Good For?
• Sales
• Raising capital
• Getting a job
• Pay and promotions
• Influence and
effectiveness
• Organizational learning
• Democracy
• Personal health
© Teten.com Source: Achieving Success Through Social Capital,Wayne Baker.

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Objections
• Not enough time
• Not enough facility with computers
• Not enough money
• Not sufficiently
extroverted
• Dislike viewing
relationships
instrumentally
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
The Rules
• “Begin with the end
in mind”
• Help
• Iterate
• Minimize effort
• Save money
• Positive
http://flickr.com/photos/h-k-d/2898797929/sizes/o/
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Introduction
Traditional Methods of Raising Capital
Web 2.0
Earmarks of People and Funds You Want to Know
Growing Your "Network 2.0"
Next Steps
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Capital Raising – Traditional Methods
Warm Introductions
Warm Introductions
Networks of Increasing trend towards funds adding dedicated Raising
Principals Capital professionals
Placement Agents Expensive
Limited Partners Always easier to tap old investors than new
PR/ conferences/ Legal ways to broadly market your fund
industry
associations
Communications Newsletters
with investors
Blog
White papers
Business Technology transfer offices at major universities
relationships with
Approaching pension fund of large companies to whom you
potential investors
have sold past portfolio companies
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Corporate Network Valuation Formula
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
N
= D * ∑ (Chn*Con *Rn* Sn*In)
n=1
© Teten.com David Teten and Scott Allen, The Virtual Handshake: Opening Doors and Closing Deals Online (www.TheVirtualHandshake.com)

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Balance of Strength and Numbers
Average Strength = Minutes Available / Person
Number = # People
therefore…
Average Strength * Number = Total Minutes Available
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Firms Fail to Capitalize on Their Internal and External Networks
• Knowledge is not readily searchable
• Knowledge is not retained when employees leave
• Relationships are not visible
• Relationships are primarily tied to colocated people
• Millennials expect and embrace social
technologies
© Teten.com Forrester Research/David Teten and Scott Allen, The Virtual Handshake: Opening Doors and Closing Deals Online (www.TheVirtualHandshake.com)

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Introduction
Traditional Methods of Raising Capital
Web 2.0
Earmarks of People and Funds You Want to Know
Growing Your "Network 2.0"
Next Steps
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
“Web 2.0 is the business revolution …
caused by the move to the Internet as platform,
and an attempt to understand the rules for
success on that new platform. ”
- Tim O’Reilly
http://en.wikipedia.org/wiki/Web_2.0, http://flickr.com/photos/oliversteiner/326174717/sizes/o/
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Web 2.0 Meme Map
Tim O’Reilly, “What is Web 2.0” www.oreillynet.com/pub/a/oreilly/tim/news/2005/09/30/what-is-web-20.html
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Benefits of Online Networks
• Searchable
• Crosses boundaries
of time and space
• Passive presence
• Ease of forming groups
• Reduced time and expense
• Greater visibility
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
The Virtual You
• Corporate
• Personal
• Your digital trail
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
The Future of Online Networks
• Online business relationships mainstream
• Technology available now
• Early adopters reap maximum benefits
• Technology required to overcome some barriers, but
education is solution
• Systems that address privacy and time concerns will be
leaders
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Transition: Web 1.0 Web 2.0
Parameters Web 1.0 (Read) Web 2.0 (Read-Write)
Governance Top-down Bottom-up
Machine to Machine and People to
Communication Channels People to Machine
People
Information Discovery Search and Browse Publish and Subscribe
Information Retrieval Transactional Relationships
Portal, Commercial
Information Aggregation Micro-Aggregation
Aggregators
Marketing, Selling Push, Contextual Conversational, Personal
Content Control Publishers, Aggregators Content Authors
Content Structure Documents, Pages Tagged Objects
Applications Closed, Proprietary Open, Standard-based
XML, AJAX, RSS, PHP, MySQL,
Technology HTML, Solaris, Oracle
XQuery
© Teten.com Partially sourced from: “Web 2.0 the Living Web and Putting “We” in the Web”, Bebo White, University of San Francisco (http://www.rthk.org.hk/mediadigest/20060915_76_121128.html)

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Powerful Emails
• Direct E-mail
– Next steps
• E-mail Signature
– Complete and current
– Link to main sites
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Toolkit
• Email groups file
• Profiles file
• Standard emails
– We are seeking…
– We offer…
– I am happy to help you
in your job search…
– Response to requests
© Teten.com http://flickr.com/photos/neilt/2517652/sizes/o/

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Introduction
Traditional Methods of Raising Capital
Web 2.0
Earmarks of People and Funds You Want to Know
Growing Your "Network 2.0"
Next Steps
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Earmarks of Potential Investors
• Investors with
particular
industry expertise
• Investors with
experience
investing in
certain
geographies
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Databases
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Introduction
Traditional Methods of Raising Capital
Web 2.0
Earmarks of People and Funds You Want to Know
Growing Your "Network 2.0"
Next Steps
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Biography Analysis Software
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Biography Analysis Software
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Case study: Daniel Zumino
•Prominent French
angel investor
•November 1999:
Sent mail to Stanford
GSB alumni list
seeking capital for
startup
•March 2000: Raised
$8m through referral
from alum
© Teten.com David Teten and Scott Allen, The Virtual Handshake: Opening Doors and Closing Deals Online (www.TheVirtualHandshake.com)

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Website
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Blogging
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Relationship Capital Management Software
Relationships See which colleagues
ranked by have best
Strength relationships to target
Email traffic patterns,
address books, billing Privacy Access
systems, employment Layer configured
history, etc. for firm’s culture
Leverage Software, Contact Network Corp., others….
Contact Network Corporation (ThomsonReuters)
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Multiple Media
• Phone
• Email
• Instant messaging
• Internet telephony (Skype)
• Web conferencing
• SMS
• Twitter
© Teten.com http://flickr.com/photos/re-ality/41676755/sizes/o/

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Online meets Offline
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Maintaining Your Relationships
• Useful emails
• Advice
• Calendar
• Observe changes
• Pit stops
• In difficulty
• Report major changes
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
How to Help People
• Job leads
• Introduce them
• Coach
• Thank people
• Develop subordinate
• Give “heads-up”
• Do dirty work
• Knowledge management system
© Teten.com http://flickr.com/photos/schluesselbein/2963638165/sizes/l/, Dig Your Well Before You’re Thirsty, Harvey Mackay

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Data from Business Cards
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Data from Email
and Files
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Data from the Cloud
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Targeting
• Directly-relevant
companies
• Fast growth
companies
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
From Cold Calling to Warm Cold Calling
Source of Lead Result Success Rate
business directories,
company listings, Ice Cold Call Low response rate
company websites
All of the methods
above, plus virtual
Higher response
communities, blogs, job Warm Cold Call
rate
networks, email lists,
biography analysis, etc.
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Blog and Web Readers
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Socialtext Wiki Case Study: Dresdner Kleinwort Investment Banking
problem • Heavy dependence on email communication &
meetings for decision-making
solution • 5,000 wiki users
benefits • Reduced meeting times by 50%
• Reduced email traffic by up to 75%
• Adoption outpaced corporate intranet usage
within six months
• Wiki today: 6,000 pages & 100,000 hits per month
© Teten.com Socialtext

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Gated Communities for Executives
• IERGOnline.com
• INMobile.org
• Sermo.com
• ComputerWorld
Executive Suite
(Exec.Compu
terworld.com)
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Gated Communities for Investors
Private Equity Focus Public Markets Focus
• ACG Network • FT Alphaville Long Room
• Angelsoft.net • SumZero.com
• Village.Albourne.com • ValueInvestorsClub.com
• Finemrespice.com • Village.Albourne.com
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Mailing Lists and Discussion Forums
• Customize standard intro
• Lurk before you leap
• Dive in, but
don’t splash
© Teten.com http://flickr.com/photos/kaibara/1231278142/sizes/o/

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Virtual Community Platforms / Social Network Sites
• Groups.Yahoo.com
• Groups.Google.com
• Grouply
• LinkedIn
• Xing
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Character – Competence – Relevance – Strength – Information – Number – Diversity
Take One Step
• By industry
• By geography
• By personal
characteristics
© Teten.com http://flickr.com/photos/extranoise/169187125/sizes/l/

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Introduction
Traditional Methods of Raising Capital
Web 2.0
Earmarks of People and Funds You Want to Know
Growing Your "Network 2.0"
Next Steps
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Web 2.0 is a better platform
Parameters Face-to-Face Web 2.0
Character Judge by a handshake SEC filings
Competence Personal resources Enterprise resources
Relevance Semi-random Focused, searchable
Strength Limited channels Multi-media
Detailed, current
Information Poor visibility
data
Number Small Large
Restricted by time, Crosses time &
Diversity
space space
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Continuous Learning
Free copy of the book
available at
TheVirtualHandshake.com
© Teten.com

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Maximize Value of Company Contact Database
© Teten.com http://flickr.com/photos/misterdna/49841409/sizes/l/

Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Maximize Value of Company Contact Database
• Goal: Increase benefit Company receives from its global contact database, and identify new
investment opportunities in doing so.
• Process:
– Gather data from individual executives’ contact databases (e.g., Blackberry, Microsoft
Outlook) into Company central contact database.
• Request from members of Company’s outside advisor network information about their
high-value contacts, e.g., CEOs of companies with over $200m in revenue.
– Run contact database against multiple Internet database providers (e.g., InfoUSA, Jigsaw,
Spoke, etc.), in order to update and verify accuracy.
– Call individuals on an as-needed basis to verify database accuracy.
– Produce “Change Reports” indicating which contacts have changed jobs, since their
change in status may correlate with a new investment opportunity. E.g., an investment
banker at Bear Stearns may have moved to Citadel. The past Controller of a client
company may now be CFO of another media company, which could become a client.
• Deliverable: Accurate database of past and current relationships. Company team can reach
out again to touch base with old clients/colleagues.
• Estimated # person-minutes per updated contact: 20-40 minutes
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Conference Attendance Optimization
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Conference Attendance Optimization
• Goal: Maximize ROI on conference attendance.
• Process:
– Company team member identifies conference which he/she plans to attend.
– Team member obtains list of attendees that meet given criteria, e.g., CEOs of companies
with over $200m in revenues.
– Cold caller solicits all attendees’ secretaries, and asks, “Do you have 15 minutes to meet
with ----- from Company, who will be attending the ----- conference with you?”
• Deliverable: Company investing team member has packed schedule of meetings.
• Estimated # person-minutes per conference attendee: 30
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Intro Traditional Methods Web 2.0 Earmarks Network Next Steps
Any questions?
Slides available at
www.Teten.com
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