Best Practices by Private Equity, Venture Capital, and Hedge Funds in Deal Origination

Where Are the Deals?! Best Practices by Private Equity, Venture Capital, and Hedge Funds in Originating Investments David Teten Teten Advisors, LLC www.Teten.com info @ teten.com 1-347-853-7397 New York, NY © 2008. All Rights Reserved - Privileged and Confidential © Teten Advisors, LLC 2008. All Rights Reserved - Privileged and Confidential http://flickr.com/photos/krikit/2745563123/sizes/o/

Intro Traditional Origination Web 2.0 Signs Network Next Steps Agenda • Introduction • Traditional Deal Origination • Web 2.0 • Signs of a Potential Investment • Growing Your Corporate Network • Next Steps © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps David Teten Biography • Currently: independent investment banker (Teten Advisors, www.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 Origination Web 2.0 Signs Network Next Steps Past Audiences for This Presentation • Association for Corporate Growth (ACG) Intergrowth • Alliance of Merger & Acquisition Advisors • Columbia Business School Alumni Club of New York • Golden Seeds (US angel group) • Harvard Business School Club of London • Kauffman Fellows program participants • Wharton Alumni Club of Northern California • Investment banks • Private equity firms • Venture capitalists • Hedge funds © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Background David Teten is leading the first-ever research project on \"Best Practices in Private Equity and Venture Capital Deal Origination\" for submission to the Journal of Private Equity (an Institutional Investor publication). He will be presenting the findings from this research in keynote talks at the 2009 national conferences for the Association for Corporate Growth (ACG.org) and the Alliance of M&A Advisors (amaaonline.org), and will be publishing related articles on this topic in other publications. Evalueserve, a global research firm and the acquirer of David’s former company (Circle of Experts), has provided supporting research and analytics for this study. These slides are a preview of the forthcoming paper. © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Why Private Information About Sellers is More Valuable Sweet spot of Lowest price Ability of highest returns Buyer to intervene to tailor pricing & terms Highest price Info is Private Info is Public Few Buyers Many Buyers © Teten.com Based on Robert Bruner, Applied Mergers & Acquisitions, page 186

Intro Traditional Origination Web 2.0 Signs Network Next Steps Higher Returns by Investing in Your Social Network Excess return=total gain minus the Treasury bill return Connected Holdings=Stocks for which managers had the strongest connection to senior officials (same school at same time with same degree) Source: The Small World of Investing: Board Connections and Mutual Fund Returns; Lauren Cohen, Andrea Frazzini, and Christopher Malloy, 2008 © Teten.com Study 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

Intro Traditional Origination Web 2.0 Signs Network Next Steps Proprietary Deal Origination for Private Equity Firms – Why is it important? Professionalization of sell-side advisors + More sophisticated sellers (including many funds) + Competition among private equity funds More Auctions Winner’s Curse Competing for the Lowest Return © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Proprietary Deal Origination for VC Firms – Why is it important? Lower costs of startup + Smooth, not chunky, increasing cost curve of a startup + VC competition More Auctions Winner’s Curse Competing for the Lowest Return © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Private Equity Deal Flow by Source 100 % 2 1 90 8 17 21 25 Other 80 25 70 24 28 In-house/direct 60 27 35 50 25 40 Buy-side intermediaries 30 49 20 40 39 Vendor 34 intermediaries 10 0 Total Large funds Upper mid-market Mid-market (Fund size >€2b) (Fund size €500m- (Fund size 2b) <€500m) Western European funds only. KPMG Private Equity: Insight into Deal Origination, 2005, Page 4. “Vendor” refers to the entity selling the equity stake. Includes uncompleted deals. © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Sources of In-House Generated Private Equity Deals Investment executives 100 % 0 3 9 15 90 13 20 13 0 Other 80 10 7 70 32 14 20 20 Managing partner/CEO 60 14 0 50 13 40 22 30 27 Existing relationship with 30 management 20 40 Advisory board non- 28 23 27 executives 10 0 Business development Total Large funds Upper mid- Mid-market executives (Fund size market (Fund size >€2b) (Fund size <€500m) €500m-2b) © Teten.com Western European funds only. Based on KPMG Private Equity: Insight into Deal Origination, 2005, Page 7. Includes uncompleted deals.

Intro Traditional Origination Web 2.0 Signs Network Next Steps Deal Idea Flow by Type of Intermediary 100 % 3 7 Deal 9 10 90 8 finders/Others 80 22 31 25 29 70 Accountants' 60 corporate 50 33 28 finance 40 55 practices 30 59 Boutique investment 20 37 34 banks 10 10 0 Investment Total Large funds Upper mid-market Mid-market banks (Fund size >€2b) (Fund size (Fund size €500m-2b) <€500m) © Teten.com Western European funds only. Based on KPMG Private Equity: Insight into Deal Origination, 2005, Page 8. Includes uncompleted deals.

Intro Traditional Origination Web 2.0 Signs Network Next Steps Why Private Equity Houses Get to See Deals from Vendor Intermediaries 100 % 2 Management buyin 90 7 candidate 14 80 Another financial adviser 70 14 Relationship with 60 management team 50 28 Relationship with 40 vendor 30 Known sector expertise 20 35 10 Relationship with vendor's intermediary 0 © Teten.com Western European funds only. Based on KPMG Private Equity: Insight into Deal Origination, 2005, Page 8. “Vendor” refers to the entity selling the equity stake. Includes uncompleted deals.

Intro Traditional Origination Web 2.0 Signs Network Next Steps Investment Search Process (# Companies) Highland TA Allied Signal Capital Associates Acquirer/Investor (1996-97) (2008) (2006) Profiled Initially 550 - - Targets selected 190 10,000* 8,000 Met NA 1,000 750 Negotiated with 28 - - Detailed due 17 - - diligence Acquired/invested 10 10-20 10-12 * Business plans received Allied Signal data: Applied Mergers & Acquisitions, by Robert F. Bruner, Chapter 7 (draft), at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=229942. Highland data: Economist, Global Heroes: A Report on Entrepreneurship, March 14, 2009, page 9. © Teten.com TA Associates data: The Big Issue: Deal Origination, Corporate Financier, October 2006

Intro Traditional Origination Web 2.0 Signs Network Next Steps Pipeline of Angel Investor Deals © Teten.com Angelsoft industry statistics. N=36257 deals.

Intro Traditional Origination Web 2.0 Signs Network Next Steps Number of Dedicated Deal Origination Professionals vs. Fund Size More than 10 33% 44% 22% (n=9) 6 to 10 (n=7) 43% 57% 1 to 5 (n=16) 13% 19% 69% Over US$ 2bn US$ 0.5 to 2bn Under US$ 500m n Fund Size © Teten.com Evalueserve, Ltd. © 2008. All Rights Reserved.

Intro Traditional Origination Web 2.0 Signs Network Next Steps Does your fund have at least one person tasked specifically and primarily with deal origination? 63% 55% 56% 63% 87% No 100% Yes 37% 45% 44% 37% 13% Overall US Europe India Latin America China (n=93) (n=33) (n=32) (n=8) (n=15) (n=5) © Teten.com Responses for Don’t Know/Cant say is excluded from the analysis. Percentages may not add up to 100 due to rounding off. Evalueserve, Ltd. © 2008. All Rights Reserved.

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice From Warm Relationships to Ice-Cold © Teten.com http://flickr.com/photos/jwthompson2/88090871/

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Personal Relationships of Fund Principals Red = tech companies Green = VC firms Blue = service providers (lawyers, PR firms, real estate agents, focused on tech). © Teten.com http://flickr.com/photos/hotrodhomepage/11103892/sizes/o//

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Reputation © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Club Deals West Coast Venture Capital Funds Each tie=1 partner shared Right cluster Left cluster includes includes Kleiner Sierra Perkins, Capital, Crosspoint, Davis & H&Q VC, Rock Institutional Venture Partners, Mayfield Asset Management Company’s Genealogy Chart, 1958-83, © Teten.com cited in “Social Networks in Silicon Valley”, Castilla, Hwang, Granovetter, and Granovetter, http://web.mit.edu/ecastill/www/publications/CastillaExtract.pdf

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Executives Operating Partner salary+carry Portfolio Company / NewCo Management salary+upside Fund Deal Executive / Executive in Residence Commit retainer+upside - ment Senior Advisor expenses+upside Free Agent expenses+upside Expert Network / Interim Executive hourly comp Rejected Execs Executive’s Income © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Limited Partners © Teten.com Dow Jones Private Equity Analyst, 2008 Review, pp. 14-15

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Executive Funds • Abernathy Group “Collaborative Investing” • Institutional Venture Partners Founders Fund • Irving Place Capital (formerly BSMB) © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Intermediaries other than Investment Bankers J.H. Cohn Private Equity Deal-flow Initiative • Private Equity Weekly Spotlight • Industry Vertical-Focused Private Equity Events • Client Profiling • Preemptive Private Equity Client Introductions • Intermediary Extension Program Winner, 2009 M&A Product/Service of the Year © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Speaking at Conferences © Teten.com http://flickr.com/photos/crincon/1143195754/sizes/l/

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Investment Bankers © Teten.com Includes equity investments of all sizes into both public and private targets. Source: Dealogic.

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Expert Networks • Generalists • Specialty/Other Players • Gerson Lehrman • Intota • Guidepoint Global (Vista) • Kingfish Group • Coleman Group • Primary Global Research • DeMatteo Monness • Primary Insight • Round Table Group • Medical • Large Parent Companies • Medical Consulting Referral • Evalueserve Circle of Experts • Sermo • Goldman Sachs Vantage • Summer Street Marketplace • Reuters Insight © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice How Expert Networks Originate Deals 1) Strengthen investor’s value-add 2) Empower the rainmaker to leverage: • Sources (especially customers) • Other rainmakers (fractional operating partner model) 3) Market map (boil the ocean) • Exhaustively search for pertinent companies 4) Thematic search • Identify or validate theme © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Acquisition Search Providers • Bainbridge • Private Capital Research • CMF Associates • Richard Vander Kaay • Dinan & Company & Associates • Evalueserve • ValuFinder Group • Harvey & Company • Most investment banks and strategy consulancies • and many others…. © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice CEO-led Strategy • Fund • Investment Banks/Recruiter Hybrids • Frontenac Company • Akoya Capital • GTCR • Blackmore Partners • Post Capital Partners • Cook Associates • Red Diamond Capital • Evalueserve • Wind Point Partners • Harvey & Company • Notch Partners • Skill Capital © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Direct Mail 3-D Deal Announcement © Teten.com Westshore Capital Partners; Weinbach Group

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Business Plan Competitions © Teten.com http://flickr.com/photos/crincon/1143195754/sizes/l/

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Cold Calling http://www.flickr.com/photos/23439761@N03/3258313816/sizes/l/ © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Personal Life © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Sample Market Mapping Approach # Stage Example 1 Identify global trend Aging population in developed countries 2 Implication for specific Finance industry: growth for financial services providers industries of interest with low-risk investing products 2 Implication for specific Japan: need for low-wage workers (likely immigrants) to geographies of interest take care of older people 3 Build market map List major players 4 Identify areas of future core business / adjacent markets; regional/global growth expansion; M&A; human capital; technology; financial structure; personal networks 5 Assess fit with Fund’s Local geographic leader that would benefit from Fund’s strategy global reach © Teten.com David Teten, based on public records of major global investors

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Be searchable • Private Equity • Venture Capital • PEDatabase.com • TheFunded.com • PrivateEquityInfo.com • VentureDeal.com • BigDough.com • Ventureone.com • Galante’s • VCProDatabase.com • Boogar.com © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Warm – Lukewarm – Ice Buy Stakes in Public Companies © Teten.com

Intro Traditional Origination Web 2.0 Signs 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/ © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Web 2.0 © Teten.com http://www.flickr.com/photos/briansolis/2735401175/sizes/l/

Intro Traditional Origination Web 2.0 Signs 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 Communication Channels People to Machine People to 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, Technology HTML, Solaris, Oracle MySQL, 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 Origination Web 2.0 Signs Network Next Steps Benefits of Online Networks • Searchable • Unlimited by time and space • Passive presence • Ease of forming groups • Reduced time and expense • Greater visibility © Teten.com http://www.flickr.com/photos/uaeincredible/3333223048/sizes/o/

Intro Traditional Origination Web 2.0 Signs Network Next Steps Private Equity Investing Cycle and Web 2.0 Private Equity How an Optimized Network is an Accelerator Investing Cycle Raise capital • Identify value-added potential investors and find a path to them • Solicit past investors in both your prior and comparable funds Originate • Identify and reach out to relevant people & companies investments • Become a magnet for investment opportunities Due diligence • Review professional and personal lives of management • Talk with firm’s network: customers, competitors, suppliers Negotiate Deal • Gain insight into counterparty’s negotiating style, motivations Improve • Recruit “A” performers operations • Accelerate sales and marketing Exit investment • Identify strategic acquirers © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Status of CEO • Serial entrepreneur • Older CEO • CEO looking to retire / getting tired • CEO acknowledging his/her limits of competence • Death • Divorce © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Status of Major Equity Owner • Private equity firm in need of exit • Corporation in distress • Short-term tax incentive • Succession battle • Death • Divorce © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Corporate Performance: Rapid growth © Teten.com http://flickr.com/photos/laserstars/908946494/sizes/o/

Intro Traditional Origination Web 2.0 Signs Network Next Steps Corporate Performance: Underperforming © Teten.com http://flickr.com/photos/carve/2856365431/sizes/l/

Intro Traditional Origination Web 2.0 Signs Network Next Steps Industry/Economic Trends • Consolidation • Growth Sector (e.g., alternative energy) • Credit crunch imposing pressure © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Databases © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Agenda • Introduction • Traditional Deal Origination • Web 2.0 • Signs of a Potential Investment • Growing Your Corporate Network • Next Steps © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Firms Fail to Capitalize on Their Internal and External Networks • Knowledge not readily searchable • Knowledge not retained when employees leave • Relationships not visible • Relationships 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 Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity 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 Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Biography Analysis Software © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Corporate Analysis Software © Teten.com

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

Intro Traditional Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Blogging © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Relationship Capital Management Software Search for people, companies, industries Relationships See which colleagues ranked by have best Strength relationships to target Email traffic patterns, Automatically address books, billing Privacy Access discovered from systems, employment Layer configured passive sources history, etc. for firm’s culture Examples: Contact Network Corp., Leverage Software Contact Network Corporation (ThomsonReuters) © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Case Study: Hamilton Robinson LLC • PE fund founded 1984; invested in 40 companies worth over $1b cumulatively • July 2002: Mark Riser (Darden 1994) placed request in Darden Alumni website noting Hamilton Robinson’s desire to find C-level managers to back in management buyouts • Riser’s classmate forwarded ad to Mark Ponozzo, President, Black Clawson Converting Machinery, $35m firm • May 2003: closed management buyout of Black Clawson © Teten.com David Teten and Scott Allen, The Virtual Handshake: Opening Doors and Closing Deals Online (www.TheVirtualHandshake.com)

Intro Traditional Origination Web 2.0 Signs 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 Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Online meets Offline © Teten.com

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

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

Intro Traditional Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Data from the Cloud © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Blog and Web Readers • Google Reader • Alacra • Connotate • InfoNGEN • First Rain • Skygrid © Teten.com

Intro Traditional Origination Web 2.0 Signs 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 communities, blogs, job networks, email Warm Cold Call Higher response rate lists, biography analysis, etc. © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Fantasy Football © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Character – Competence – Relevance – Strength – Information – Number – Diversity Gated Communities for Executives • IERGOnline.com • Executive-Forum.org • INMobile.org © Teten.com

Intro Traditional Origination Web 2.0 Signs 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 © Teten.com

Intro Traditional Origination Web 2.0 Signs 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 (c) 2008 Anderson Analytics, Linkedin, SPSS, http://www.marketingcharts.com/interactive/linkedin-users-have-high-personal-financial-success-6743/linkedin-anderson-analytics-busy-decision-makers-august-2008jpg © Teten.com

Intro Traditional Origination Web 2.0 Signs Network Next Steps Web 2.0 is a better platform Parameters Face-to-Face Web 2.0 Judge by a Character SEC filings handshake 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 Origination Web 2.0 Signs Network Next Steps Maximize Value of Fund Contact Database © Teten.com http://flickr.com/photos/misterdna/49841409/sizes/l/

Intro Traditional Origination Web 2.0 Signs Network Next Steps Conference Attendance Optimization © Teten.com http://flickr.com/photos/oxfam/2087484701/sizes/l/

Intro Traditional Origination Web 2.0 Signs Network Next Steps Recruit Senior Advisor Board Members © Teten.com http://www.sxc.hu/photo/985516

Intro Traditional Origination Web 2.0 Signs Network Next Steps Any questions ? Slides at www.Teten.com Free book download at TheVirtualHandshake.com © Teten.com

Where Are the Deals?! Best Practices by Private Equity, Venture Capital, and Hedge Funds in Originating Investments David Teten Teten Advisors, LLC www.Teten.com info @ teten.com 1-347-853-7397 New York, NY © 2008. All Rights Reserved - Privileged and Confidential © Teten Advisors, LLC 2008. All Rights Reserved - Privileged and Confidential http://flickr.com/photos/krikit/2745563123/sizes/o/

Best Practices by Private Equity, Venture Capital, and Hedge Funds in Deal Origination

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