How To Raise Venture Capital

What You Need To Know About Raising Venture Capital

Who Is DFJ Gotham Ventures? www.dfjgotham.com DANNY SCHULTZ MARK DAVIS ROSS GOLDSTEIN THATCHER BELL Focus Sectors
Digital Media
Financial Technologies
E-commerce
Mobile Technologies
Network Infrastructure
Early Stage
First institutional round
Nominal or no revenue
Demonstrable technology
Global Presence
Leverage DFJ Network

Who Does DFJ Gotham Invest In?

What Is The DFJ Network? 23 funds, >$6 billion in capital 150 professionals, 600 portfolio companies Unique access, insight and deal flow

Markpeterdavis.com
Chapters :
VC Overview
Developing A Fundraising Strategy
Picking The VCs
Preparing Your Materials
The Pre-Fundraising Process
Getting The Meeting
The First Meeting
After The First Meeting
The Due Diligence Phase
Doing The Deal
The Entrepreneur’s Guide To Raising Venture Capital

What Makes A Company Successful? How you finance your company matters! Team Idea Finance

Is VC Right For Your Startup? Scalability of Business Capital Required to Achieve Breakeven Cash Flow High Low High Low Venture Capital Build a Giant Co Bootstrap Own 80% of a Small Co Not Viable Weak Barriers: Venture Capital Strong Barriers: Bootstrap

Can Your IT Company Scale? Technology Barriers Examples
Tech-lite ( Old Tech Re-Applied )
Facebook, eBay, Twitter
Data scale (e.g., Web 2.0 data)
Network effects (e.g., SocNets)
Tech-heavy ( New Tech )
Microsoft Office, Adobe, Skype
Data scale
Network effects
Econ. Of scale
Intellectual Property
Hybrid Business Information Business Technology Business
Tech-heavy ( New Tech )
Google, Oracle, Microsoft OS, Akamai
Economies of Scale
Intellectual Property

Why VC Is Helpful? Low High Friends & Family Angels Venture Capitalists Capital Advice Connections

Are You Ready For VC? Great Team Huge Market Product in Market Seed ($50K - $1M) X Series A (>$1M – 5M)

What Materials Do You Need? Get the meeting Executive Summary Create interest Presentation Explain how Financial Model

What Topics Do You Need To Cover? Executive Summary Presentation Location Mission Overview Addressable Market Competitive Landscape Barriers Achievements Financials Capital Raised Objectives Management Bios

What Topics Do You Need To Cover? Location Mission Overview Addressable Market Competitive Landscape Barriers Achievements Financials Capital Raised Objectives Management Bios Be sure to include these Not market size State why you’re better May be more than you think

How Do You Get The Meeting? Mutual Contact LinkedIn Cold Email Spam Most Effective Least Effective Direct Introduction

What Is The Objective Of The First Meeting? To get the second meeting. What is the objective of the first meeting?

How Can You Guide The Meeting? Product? Market? Competition? Team? Typical Non-Linear Meeting Set The Tone Up Front
Product: Technology that solves…
Addressable Market: $2.5B
Competitive: Significant technology barrier
Team: 35 years relevant experience

How Can You Maintain Momentum? Industry News Milestones Internal Materials

How Do You Know You’re Close To A Term Sheet? Can you come meet the rest of my partners? How do you feel about these terms?

What Should You Expect In A Term Sheet? An Exploding Offer Exclusivity 30 day Due Diligence Participating Preferred Stock Liquidity Preference Founder’s Equity Vesting

What Happens After The Investment? On The Same Side Of The Table

Contact Info Mark Davis DFJ Gotham Ventures (212) 279-3980 Blog: markpeterdavis.com twitter.com/markpeterdavis

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How To Raise Venture Capital

by Mark Davis on Jul 20, 2010

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How To Raise Venture Capital — Presentation Transcript