Funding your Project - Raising Capital
 

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Funding your Project - Raising Capital

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Delivered by Bill Murphy of Enterprise Angels.

Delivered by Bill Murphy of Enterprise Angels.

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Funding your Project - Raising Capital Presentation Transcript

  • 1. FUNDING YOUR PROJECTMark Renner and Phil Taylor
  • 2. SOURCES OF MONEY
    Friends and Family
    Bank
    Professional Investors/Funds
  • 3. PROFESSIONAL INVESTORS
    Angel Investors
    Venture Capital
    Private Equity
  • 4. ANGEL ORGANISATIONS CAN HELP FILL CAPITAL GAP
  • 5. SOURCE OF EQUITY FUNDS – TYPICAL YEAR
    New Company Formation
  • 6. MARKET IN NEW ZEALAND
    $300 million invested into 100 companies
    Of the 100 companies:
    • 79 are exporting
    • 7. 29 have received investment from offshore investors
    • 8. 23 emerged from either universities or Crown Research Institutes, and 19 have been part of business incubators
    • 9. Auckland is home to 53 of the companies, with Christchurch hosting 16
    • 10. 9 have been sold and 7 have been written off or liquidated
    • 11. 28 of the investments were into seed stage enterprises, 56 were into start-up companies, 15 into early expansion companies, and 1 company at the expansion stage
  • INVESTOR MINDSET
    Profit
    Risk
    Valuation
    • Almost no pre-market company will be worth $1m
    • 12. 1 or 2 of every 10 investments brings most of return
    • 13. Hard to tell which companies will return
    • 14. Angels looking for 10 to 30X potential
    • 15. 30% of all exits in 2010 were in bankruptcy
  • STATE OF THE MARKET
    Its hard to raise new money
    But money is available
    Investors active in this space:
    • Endeavour Capital
    • 16. BioPacific Ventures
    • 17. University commercialisation arms
    • 18. NZ Venture Investment Fund
    • 19. Angel Associations
  • DEAL FLOW STATISTICS – ANGEL GROUPS
    Prescreening 1 in 4 to screening
    Screening 1 in 3 to DD/present
    Due Diligence 1 in 3 to investment meeting
    Investment 1 in 2 raise money
    OVERALL 1 to 4 in 100 who apply receive investment
  • 20. INVESTOR TERMS
    Type of Security
    • Preference shares? Liquidation Preference.
    • 21. Convertible note?
    Board seat
    Protective provisions
    Drags/tags
    Pre-emptive rights
    Exit