Raising Capital What, When, Who, How & Where Strategies to Help Your Business Grow or Simply Survive @ Kishor Conference (...
<ul><li>Build a good business </li></ul><ul><ul><li>Long-lasting </li></ul></ul><ul><ul><li>Valuable to society </li></ul>...
<ul><li>Honesty truly is the best policy </li></ul><ul><ul><li>Investors have heard it all before & can see through the li...
<ul><ul><li>Purposeful decision making  </li></ul></ul><ul><ul><li>Creating ideas are easy, implementation is hard </li></...
<ul><li>When do I need an infusion of capital? </li></ul><ul><ul><li>Startup Capital (necessary) </li></ul></ul><ul><ul><u...
<ul><li>When do I need an infusion of capital? </li></ul><ul><ul><li>Milestone Capital (necessary) </li></ul></ul><ul><ul>...
<ul><li>Considerations to receiving capital: </li></ul><ul><ul><li>Amount of money </li></ul></ul><ul><ul><li>Ownership </...
<ul><li>How do I know you need a capital infusion? </li></ul><ul><ul><li>What would I do if I have more capital? </li></ul...
<ul><li>Budgeting / Pitching / Business Plan </li></ul><ul><ul><li>Bottom-up forecasting </li></ul></ul><ul><ul><ul><li>Op...
<ul><li>What if I don’t have the cash? </li></ul><ul><li>Bootstrap </li></ul><ul><ul><li>Keep requirements low & can’t rai...
<ul><li>Bootstrap Business Model </li></ul><ul><ul><li>Low up-front capital requirements </li></ul></ul><ul><ul><li>Short ...
<ul><li>Bootstrap Target Markets </li></ul><ul><ul><li>Don’t have to educate the pain </li></ul></ul><ul><ul><ul><li>Ex: C...
<ul><li>Bootstrapping techniques </li></ul><ul><ul><li>Start as service business </li></ul></ul><ul><ul><li>Outsource </li...
<ul><li>Bootstrapping techniques </li></ul><ul><ul><li>Understaff </li></ul></ul><ul><ul><ul><li>Might lose sales  </li></...
<ul><li>Can I Bootstrap too much? </li></ul><ul><ul><li>Greater danger of blowing opportunity because of too much money </...
<ul><li>Investors </li></ul><ul><ul><li>Show traction </li></ul></ul><ul><ul><ul><li>Proven team </li></ul></ul></ul><ul><...
<ul><li>Investors </li></ul><ul><ul><li>Looking for reasons not to invest </li></ul></ul><ul><ul><ul><li>Clean up your act...
<ul><li>Investors – “Maybe” means “No” </li></ul><ul><ul><li>However, they might change their mind </li></ul></ul><ul><ul>...
<ul><li>Private Individuals </li></ul><ul><ul><li>Not suckers </li></ul></ul><ul><ul><li>Understand their motivation </li>...
<ul><li>Foundations </li></ul><ul><ul><li>Two Foci </li></ul></ul><ul><ul><ul><li>Women Empowerment </li></ul></ul></ul><u...
<ul><li>Personal money </li></ul><ul><ul><li>Nothing impressive to demonstrate to other investors </li></ul></ul><ul><ul><...
<ul><li>Bank </li></ul><ul><ul><li>Go where the expertise is </li></ul></ul><ul><ul><li>Loan vs. Credit Line </li></ul></u...
<ul><li>Get an Introduction </li></ul><ul><ul><li>Tilt the playing field </li></ul></ul><ul><ul><li>Recommendations from c...
<ul><li>Can’t get an Introduction? </li></ul><ul><li>Network </li></ul><ul><ul><li>Ask  halachic  questions now </li></ul>...
“ The foundation for doing good is doing well”  Peter Drucker
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Raising Capital: Strategies to Help Your Business Grow or Simply Survive

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Slides used for a presentation on Raising Capital given to Women Professionals at the Kishor Conference in Jerusalem, Israel, on June 13, 2011.

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Raising Capital: Strategies to Help Your Business Grow or Simply Survive

  1. 1. Raising Capital What, When, Who, How & Where Strategies to Help Your Business Grow or Simply Survive @ Kishor Conference (Women Professionals Network) Jerusalem, Israel June 13, 2011 The Nonprofit Banker nonprofitbanker.com “ Money Diaper ” by Clothdragon1
  2. 2. <ul><li>Build a good business </li></ul><ul><ul><li>Long-lasting </li></ul></ul><ul><ul><li>Valuable to society </li></ul></ul><ul><ul><li>Filling a need </li></ul></ul><ul><ul><li>Money will not be the impediment </li></ul></ul><ul><ul><ul><li>You’ll have OR </li></ul></ul></ul><ul><ul><ul><li>People will want to give </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com Key Principles
  3. 3. <ul><li>Honesty truly is the best policy </li></ul><ul><ul><li>Investors have heard it all before & can see through the lies </li></ul></ul><ul><ul><li>Don’t fudge your estimates </li></ul></ul><ul><ul><ul><li>Assuming you even have a clue! </li></ul></ul></ul><ul><ul><li>It’s ok if it’s your first venture </li></ul></ul><ul><ul><ul><li>Every successful entrepreneur started at zero </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com Key Principles
  4. 4. <ul><ul><li>Purposeful decision making </li></ul></ul><ul><ul><li>Creating ideas are easy, implementation is hard </li></ul></ul><ul><ul><ul><li>Show them you’ve got what it takes </li></ul></ul></ul><ul><ul><ul><li>People invest in people more than in ideas </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com Key Principles
  5. 5. <ul><li>When do I need an infusion of capital? </li></ul><ul><ul><li>Startup Capital (necessary) </li></ul></ul><ul><ul><ul><li>One-time + Break-Even </li></ul></ul></ul><ul><ul><li>Growth Capital (potentially necessary) </li></ul></ul><ul><ul><ul><li>Greater market share for greater profit </li></ul></ul></ul><ul><ul><ul><li>Each growth stage has a break-even </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com When & Why?
  6. 6. <ul><li>When do I need an infusion of capital? </li></ul><ul><ul><li>Milestone Capital (necessary) </li></ul></ul><ul><ul><ul><li>Reach next stage of development </li></ul></ul></ul><ul><ul><ul><li>Milestone + 6 months </li></ul></ul></ul><ul><ul><li>Survival Capital (necessary) </li></ul></ul><ul><ul><ul><li>Hardest to get </li></ul></ul></ul><ul><ul><ul><li>Not producing, just staying afloat </li></ul></ul></ul><ul><ul><ul><li>Necessary, nonetheless </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com When & Why?
  7. 7. <ul><li>Considerations to receiving capital: </li></ul><ul><ul><li>Amount of money </li></ul></ul><ul><ul><li>Ownership </li></ul></ul><ul><ul><ul><li>Stock & Board member </li></ul></ul></ul><ul><ul><li>Opening doors </li></ul></ul>The Nonprofit Banker nonprofitbanker.com When & Why?
  8. 8. <ul><li>How do I know you need a capital infusion? </li></ul><ul><ul><li>What would I do if I have more capital? </li></ul></ul><ul><ul><li>Considerations? </li></ul></ul><ul><ul><ul><li>Meeting expenses </li></ul></ul></ul><ul><ul><ul><li>Product to market </li></ul></ul></ul><ul><ul><ul><li>Competition looming </li></ul></ul></ul><ul><ul><ul><li>Increase quality </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com When & Why?
  9. 9. <ul><li>Budgeting / Pitching / Business Plan </li></ul><ul><ul><li>Bottom-up forecasting </li></ul></ul><ul><ul><ul><li>Opposite of top-down </li></ul></ul></ul><ul><ul><ul><ul><li>Calculate how much of market needed to be successful </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Top-down = belly-up </li></ul></ul></ul></ul><ul><ul><ul><li>Based on real-world variables </li></ul></ul></ul><ul><ul><ul><li>Results will determine how strapped for cash you are </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com When & Why?
  10. 10. <ul><li>What if I don’t have the cash? </li></ul><ul><li>Bootstrap </li></ul><ul><ul><li>Keep requirements low & can’t raise VC will NOT limit you </li></ul></ul><ul><ul><li>Manage for CASHFLOW & not for PROFIT </li></ul></ul><ul><ul><ul><li>Paper profits are secondary </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com When & Why?
  11. 11. <ul><li>Bootstrap Business Model </li></ul><ul><ul><li>Low up-front capital requirements </li></ul></ul><ul><ul><li>Short sale cycles (under a month) </li></ul></ul><ul><ul><li>Short payment terms (under a month) </li></ul></ul><ul><ul><li>Recurring revenue </li></ul></ul><ul><ul><li>Free advertizing </li></ul></ul><ul><ul><li>On paper less profitable due to forgone sales </li></ul></ul>The Nonprofit Banker nonprofitbanker.com When & Why?
  12. 12. <ul><li>Bootstrap Target Markets </li></ul><ul><ul><li>Don’t have to educate the pain </li></ul></ul><ul><ul><ul><li>Ex: Cell phone cases </li></ul></ul></ul><ul><ul><li>Megatrend is breaking barriers </li></ul></ul><ul><ul><ul><li>Ex: iPhone craze </li></ul></ul></ul><ul><ul><li>Piggyback on existing products </li></ul></ul><ul><ul><ul><li>Ex: Twitter clients </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com When & Why?
  13. 13. <ul><li>Bootstrapping techniques </li></ul><ul><ul><li>Start as service business </li></ul></ul><ul><ul><li>Outsource </li></ul></ul><ul><ul><ul><li>Outsource as much as you can </li></ul></ul></ul><ul><ul><ul><li>Don’t outsource strategic functions </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com When & Why?
  14. 14. <ul><li>Bootstrapping techniques </li></ul><ul><ul><li>Understaff </li></ul></ul><ul><ul><ul><li>Might lose sales </li></ul></ul></ul><ul><ul><ul><li>Might achieve escape velocity slower </li></ul></ul></ul><ul><ul><ul><li>Better than laying off employees & running out of money </li></ul></ul></ul><ul><ul><ul><ul><li>Ex: Bonkers, Pizza Meter </li></ul></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com When & Why?
  15. 15. <ul><li>Can I Bootstrap too much? </li></ul><ul><ul><li>Greater danger of blowing opportunity because of too much money </li></ul></ul><ul><ul><li>Guy Kawasaki: Think of VC as steroids </li></ul></ul><ul><li>Do I HAVE to look for outside capital? </li></ul><ul><ul><li>Heck no </li></ul></ul><ul><ul><ul><li>No one way to build something great </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com When & Why?
  16. 16. <ul><li>Investors </li></ul><ul><ul><li>Show traction </li></ul></ul><ul><ul><ul><li>Proven team </li></ul></ul></ul><ul><ul><ul><li>Sales (Revenue) </li></ul></ul></ul><ul><ul><ul><ul><li>Make sure they are really yours </li></ul></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com Who & How?
  17. 17. <ul><li>Investors </li></ul><ul><ul><li>Looking for reasons not to invest </li></ul></ul><ul><ul><ul><li>Clean up your act </li></ul></ul></ul><ul><ul><ul><ul><li>Intellectual property </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Ownership </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Management </li></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Spouses or Close-Friends </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><li>Compliance </li></ul></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com Who & How?
  18. 18. <ul><li>Investors – “Maybe” means “No” </li></ul><ul><ul><li>However, they might change their mind </li></ul></ul><ul><ul><ul><li>Keep the connection </li></ul></ul></ul><ul><ul><ul><li>Answer lingering questions </li></ul></ul></ul><ul><ul><ul><li>Provide supplemental information </li></ul></ul></ul><ul><ul><ul><li>Update: closed big customers </li></ul></ul></ul><ul><ul><ul><li>Update: reached milestones early </li></ul></ul></ul><ul><ul><ul><li>Update: attracted respectable investors </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com Who & How?
  19. 19. <ul><li>Private Individuals </li></ul><ul><ul><li>Not suckers </li></ul></ul><ul><ul><li>Understand their motivation </li></ul></ul><ul><ul><li>Enable them to live vicariously </li></ul></ul><ul><ul><li>Pitch to the family </li></ul></ul><ul><ul><li>Be nice, you’re family </li></ul></ul><ul><ul><li>Sign up people they know – it’s about socializing too </li></ul></ul>The Nonprofit Banker nonprofitbanker.com Who & How?
  20. 20. <ul><li>Foundations </li></ul><ul><ul><li>Two Foci </li></ul></ul><ul><ul><ul><li>Women Empowerment </li></ul></ul></ul><ul><ul><ul><li>Employment for (Ultra) Religious Community </li></ul></ul></ul><ul><li>Gemach / Free-Loan Societies </li></ul><ul><ul><li>Some hamish , some professional </li></ul></ul><ul><ul><li>How will their funding influence other investors? </li></ul></ul>The Nonprofit Banker nonprofitbanker.com Who & How?
  21. 21. <ul><li>Personal money </li></ul><ul><ul><li>Nothing impressive to demonstrate to other investors </li></ul></ul><ul><ul><ul><li>However, you’ve put your money where your mouth is </li></ul></ul></ul><ul><ul><li>Good for creating breathing space to build traction </li></ul></ul>The Nonprofit Banker nonprofitbanker.com Who & How?
  22. 22. <ul><li>Bank </li></ul><ul><ul><li>Go where the expertise is </li></ul></ul><ul><ul><li>Loan vs. Credit Line </li></ul></ul><ul><ul><li>Consider collateral </li></ul></ul><ul><ul><ul><li>Refinancing </li></ul></ul></ul><ul><ul><li>Not just banks, </li></ul></ul><ul><ul><ul><li>Credit card companies </li></ul></ul></ul><ul><ul><ul><li>Insurance companies </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com Who & How?
  23. 23. <ul><li>Get an Introduction </li></ul><ul><ul><li>Tilt the playing field </li></ul></ul><ul><ul><li>Recommendations from credible sources </li></ul></ul><ul><ul><ul><li>Current Investors </li></ul></ul></ul><ul><ul><ul><li>Board members </li></ul></ul></ul><ul><ul><ul><li>Lawyers / Accountants </li></ul></ul></ul><ul><ul><ul><li>Other entrepreneurs </li></ul></ul></ul><ul><ul><ul><li>Professors </li></ul></ul></ul>The Nonprofit Banker nonprofitbanker.com Where?
  24. 24. <ul><li>Can’t get an Introduction? </li></ul><ul><li>Network </li></ul><ul><ul><li>Ask halachic questions now </li></ul></ul><ul><li>THANK YOU </li></ul>The Nonprofit Banker nonprofitbanker.com Where?
  25. 25. “ The foundation for doing good is doing well” Peter Drucker

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