By: Mr. Mohsin Khan
Utthishta Yekum Fund
Funding for startups
Arise Advance Ascend
1. Stages of startup funding
2. Risks associated with startups
3. Investor lens/scorecard
4. Case study
2Transcend Excel Glorify
Funding stages of a Startup
Spur Stimulate Intensify
The top three risks that startups face are as follows:
– Team / Founder’s Risk
– Technology / Technical Risk
– Market / Customer Risk
4Emerge Swell Move Up
Risks associated with Startups
• Chemistry between team members
• Have they worked together before or not
• Passion to work for the long haul
• Complementary skills. Eg. One techie, one
sales, etc.. Or same skills all techies..
5Aggrandize Glorify Soar High
Team / Founder’s Risk
6Ascend Outshine Go Places
• Technology on which the start-up is based will it
work or fail
• Differences in tech resources needed for different
startups. Eg. Software can be tested using just open
source / free platforms. Any other technologies
require resources to create first prototype
• The most important or critical risks for a
• Will customers adopt or use the product /
service or not
• Will customers pay for the product / service
• In the end if they are no paying customers
there is no startup
7Stimulate Incite Stir Up
Market / Customer Risk
10Arise Wake Up Rise Up
How to use the Score card?
• Think like investors
• Audience is divided into three groups- First
check, Angels, VC’s.
• Read the case study and use parameters of scorecard to score
(1 – 5) the startup in the case study
• Justify your score. Why 1 (low) - 5 (high) ?
• Use the questions and pointers to gain deeper details about
the startup against each parameter
Evaluation Criteria Answer the questions?
•Is the team aligned with the business plan?
•Team experience in the sector.
Market Size •How big is the market size and how many customers do you have?
•How large is the focused customer segment market?
•Where are the customers? Identify the segments?
•What is the loyalty or retention level?
Competitive positioning •How are they placed on the competitive map?
Customer acquisition process
Time and money taken to acquire a customer?
Cost of customer acquisition (COCA) vs life time value (LTV)
Scalability(Technology based) •Scalability of your business based on technology and not human resources.
Internal systems & processes
•Is technology used to scale systems with growth?
•How is the customer feedback loop closed?
Differentiator (Secret sauce) •USP, key differentiators, Uniqueness of the technology
•Burn rate and survival time. Deviations and dependencies with the current
Revenue & Profit •Average price, Average customer, Ticket size, Monthly and annual revenues,
Break-even time, Cost margins, EBITDA
Exit & Return •Potential ROI & Exit Strategy
Investor Score card
12Outshine Outstrip Outperform
• If you want to raise money learn to Think like investors
• Startups need to prove traction and product
prototype. This requires you to show that there are
reasonable number of people willing to pay for and
use your product.
• Then prove to yourself if the existing model is scalable
through technology and not people, if not rework on
• After scalability, test your sustainability by evaluating
competition and internal systems and processes.
Key Takeaways (Cotnd…)
• To sustain note your differentiators, customer profile
and acquisition aspects.
• Customer acquisition metrics (COCA) vs Life time
value (LTV). LTV > COCA (preferably 3 times)
• Then do the number crunching for budget and
• Circle back to the stage of your company and value it
with the evolution and changes.
• We repeat, think like an investor because you are truly
investing your time and effort into it. You are a
shareholder of your idea end of the day.
Evolve Emerge Enlarge