FUNDRAISINGIN SILICON VALLEY2012-07-10 for TechTalks.phPhilip Stehlik
About•  Entrepreneur living in San Francisco•  Startups – joined one @19 started first @22•  Money from friends and ‘angel...
Venture capital (VC) is financial capital provided to early-stage, high-potential, high risk, growth startupcompanies.The ...
Venture capital (VC) is financial capital provided to early-stage, high-potential, high risk, growth startupcompanies.The ...
Good
Raising money?!•  Grow and accelerate a business•  Having a novel idea or approach•  Software, Hardware, Medicine,     Spa...
Raising money is not for•  Lifestyle business•  Low-growth•  Low-potential (VCs want high return)
After raising - You will not just get•  High salary•  More customers•  More traction•  Less work•  Less pressure•  Money ≠...
After raising you might get•  New hires to compliment your teams skillset•  Marketing exposure and marketing $$•  A chance...
Some hints•  Can you do it without raising?•  Bootstrap as long as possible•  Traction is key•  Choose your investors to a...
How much money to raise•  Roughly (Series A):•  12-18 months run-rate•  Trying to give away 10%-20% of company max•  Fundr...
Different funding providers•  Angels – wealthy individuals•  Angel groups – multiple Angels•  Super Angels – very wealthy ...
Fundraising flow part 1•  Decision to raise money•  Build story•  Build pitch•  Build deck•  Research investors•  Intros• ...
Pitching•  Elevator pitch   o  60 seconds to fame (verbally & e-mail)   o  Get somebody who doesn’t know you excited enoug...
Tools you have•  Marketing•  AngelList (your fundraising profile and     distribution)•    Dealflow/traction•    Social Pr...
Fundraising flow part 2•  Have interested investor(s)•  Determine which investor(s) would be best•  Agree on baseline term...
Stock options•  Way to compensate your employees     o  Retain employees     o  Vesting over four years     o  One year cl...
Different types of stock•  Common stock  o  The most basic stock there is•  Preferred stock  o  Stock with special conditi...
Having multiple investors•  Angel Group•  Multiple Angels•  Multiple VCs•  Lead investor•  More investors = more people to...
Watch out for•  Location  o  For fundraising you need to go to where the money is•  Over-valuation  o  If you can’t delive...
Thanks!Say hi when you are in San Francisco!p@pstehlik.com@pstehlikhttp://pstehlik.com
Img:   Scrooge MC Duck   Graph
Philip Stehlik at TechTalks.ph - Fundraising in Silicon Valley
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Philip Stehlik at TechTalks.ph - Fundraising in Silicon Valley

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Philip Stehlik at TechTalks.ph - Fundraising in Silicon Valley

  1. 1. FUNDRAISINGIN SILICON VALLEY2012-07-10 for TechTalks.phPhilip Stehlik
  2. 2. About•  Entrepreneur living in San Francisco•  Startups – joined one @19 started first @22•  Money from friends and ‘angels’•  Failed with a couple of ideas and projects•  One company got acquired•  Helping out a couple of startups•  CTO Co-Founder Taulia in 2009 (Ser.A & B)•  Serving Fortune 2000 companies with financial SaaS + SAP add-on
  3. 3. Venture capital (VC) is financial capital provided to early-stage, high-potential, high risk, growth startupcompanies.The venture capital fund makes money by owning equityin the companies it invests in, which usually have a noveltechnology or business model in high technologyindustries, such as biotechnology, IT, software, etc.The typical venture capital investment occurs after the seedfunding round as growth funding round (also referred to asSeries A round) in the interest of generating a returnthrough an eventual realization event, such as an IPO ortrade sale of the company.source wikipedia
  4. 4. Venture capital (VC) is financial capital provided to early-stage, high-potential, high risk, growth startupcompanies.The venture capital fund makes money by owning equityin the companies it invests in, which usually have a noveltechnology or business model in high technologyindustries, such as biotechnology, IT, software, etc.The typical venture capital investment occurs after the seedfunding round as growth funding round (also referred to asSeries A round) in the interest of generating a returnthrough an eventual realization event, such as an IPO ortrade sale of the company.source wikipedia
  5. 5. Good
  6. 6. Raising money?!•  Grow and accelerate a business•  Having a novel idea or approach•  Software, Hardware, Medicine, Space travel, ...•  Giving away parts of your company•  Investors need to make money•  Eventual sale or IPO of the company
  7. 7. Raising money is not for•  Lifestyle business•  Low-growth•  Low-potential (VCs want high return)
  8. 8. After raising - You will not just get•  High salary•  More customers•  More traction•  Less work•  Less pressure•  Money ≠ The solution to everything
  9. 9. After raising you might get•  New hires to compliment your teams skillset•  Marketing exposure and marketing $$•  A chance to iterate a few times on your product (before making or running out of money)•  VCs who take calls of your customers•  Intros•  Resources (advice, hiring, marketing, ...)
  10. 10. Some hints•  Can you do it without raising?•  Bootstrap as long as possible•  Traction is key•  Choose your investors to assure a good fit•  Try to stay in control - it is still your company•  Usually your investors are on your side. They WANT you to succeed.
  11. 11. How much money to raise•  Roughly (Series A):•  12-18 months run-rate•  Trying to give away 10%-20% of company max•  Fundraising is full-time job - you dont want to do it every couple of months•  Dont give away too much of your company or you wont have anything left at the end•  Raising a bit more than you need will allow you to survive smaller issues along the way
  12. 12. Different funding providers•  Angels – wealthy individuals•  Angel groups – multiple Angels•  Super Angels – very wealthy individuals•  Incubators/Accelerators – Institutions providing funding, space, connections,...•  Venture Capital firms – Full-time professional investors, usually after ‘seed’
  13. 13. Fundraising flow part 1•  Decision to raise money•  Build story•  Build pitch•  Build deck•  Research investors•  Intros•  Pitch•  Iterate
  14. 14. Pitching•  Elevator pitch o  60 seconds to fame (verbally & e-mail) o  Get somebody who doesn’t know you excited enough to hear more of your story•  Intros o  The most important piece to get good meetings•  Pitch deck o  Usually 10 slides, telling your story•  Segment before pitching – try your pitch out o  Harder to turn around a ‘no’ than pitching fresh•  Product demo
  15. 15. Tools you have•  Marketing•  AngelList (your fundraising profile and distribution)•  Dealflow/traction•  Social Proof•  Intros•  Being in a hot market•  The right team’•  Not needing the money
  16. 16. Fundraising flow part 2•  Have interested investor(s)•  Determine which investor(s) would be best•  Agree on baseline terms•  Sign term-sheet•  Figure out details and sign lots of paper•  Get money•  Pay lawyers•  Get back to building your business
  17. 17. Stock options•  Way to compensate your employees o  Retain employees o  Vesting over four years o  One year cliff•  These are not shares – but options to buy (common) stock•  Option pool usually set at founding and rounds of funding•  Different tax implications (at least in US) for different kinds of options – ask tax expert!
  18. 18. Different types of stock•  Common stock o  The most basic stock there is•  Preferred stock o  Stock with special conditions attached to it o  E.g. Preferred participation in liquidity event o  Details about conditions are in funding contracts o  Usually 1 time participating preferred
  19. 19. Having multiple investors•  Angel Group•  Multiple Angels•  Multiple VCs•  Lead investor•  More investors = more people to communicate with and to ‘manage’
  20. 20. Watch out for•  Location o  For fundraising you need to go to where the money is•  Over-valuation o  If you can’t deliver and raise a down-round it will hurt!•  I say once more: o  Traction o  Team o  Social proof o  Do your due-diligence
  21. 21. Thanks!Say hi when you are in San Francisco!p@pstehlik.com@pstehlikhttp://pstehlik.com
  22. 22. Img: Scrooge MC Duck Graph
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