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Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
Entrepreneurship & Fundraising
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Entrepreneurship & Fundraising

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Talk by Ariel Poler at the Universidad de San Andres in Buenos Aires, Argentina. About entrepreneurship and fundraising. During the Geeks on a Plane trip to Brazil, Chile & Argentina.

Talk by Ariel Poler at the Universidad de San Andres in Buenos Aires, Argentina. About entrepreneurship and fundraising. During the Geeks on a Plane trip to Brazil, Chile & Argentina.

Published in: Economy & Finance, Business
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  • 1. FUNDRAISING IN SILICON VALLEY – PLUS A FEW RANDOM THOUGHTS. ARIEL POLER
  • 2. I've been on three sides of the table... <ul><li>Started three Internet companies </li></ul><ul><li>     - I/PRO (1994): VCs & strategic investors (4 rounds) </li></ul><ul><li>     - Topica (1998): Angels, VCs and private equity investors (3 rounds) </li></ul><ul><li>     - TextMarks (2006): self financed to profitability. </li></ul><ul><li>Chairman or Active Board Member at 10+ companies </li></ul><ul><li>     - Kana (VC, PE, IPO); LinkExchange (VCs); Freedom Financial (angels); Passporta (angels); Papilia (angels); Odeo (VC); StumbleUpon (angels); LOLapps (angels, VC); SpeedDate (angels, VC); Strava (angels, VC), MixTent (angels). </li></ul><ul><li>Angel in over 40 start-ups </li></ul><ul><li>     - NexTag, AdMob, Kongregate, SlideShare, Flixster, Rockyou, Xobni, Causes, Aptimus, Outright, Urbano, LatiLists, Blippy, Digital Impact, Thumbtack, Viikii, Instructables, Groupspaces, Evite, WeGame, ccLoop </li></ul>
  • 3. Silicon Valley is Another Planet – Be Very Careful When Trying to Replicate It <ul><li>- Very unique, even within the US and California </li></ul><ul><li>- We have the process down to a science: </li></ul><ul><li>     - term sheets </li></ul><ul><li>     - compensation arrangements </li></ul><ul><li>     - partnerships </li></ul><ul><li>     - technologies & services </li></ul><ul><li>     - legal, banking, accounting, hr... </li></ul><ul><li>- You get to eat with the influencers every day! </li></ul>
  • 4. VCs and Angels only represent a tiny fraction of the financings in the world – Including in USA <ul><li>Most companies are bootstraped, funded by friends & family, credit cards, cash flow, etc. etc. </li></ul><ul><li>But: VCs & Angels do account for a large share of innovative technology start-ups in the US. </li></ul>
  • 5. It is not a Black and White distinction between Angels, VCs, Private Equity <ul><li>There are many shades of Grey... </li></ul><ul><li>Angels with funds. </li></ul><ul><li>VCs that focus on seed investments. </li></ul><ul><li>VCs that participate in seed rounds. </li></ul><ul><li>VCs with Private Equity like late stage funds </li></ul><ul><li>What matters most is the individual, not the firm! </li></ul>
  • 6. On &quot;average&quot;, It takes 6 Months...  <ul><li>But averages are often meaningless </li></ul><ul><li>&quot;Hot deals&quot; are done in a few weeks, some times a few days </li></ul><ul><li>Most deals never get done. </li></ul><ul><li>And somehow the average is 6 months... </li></ul><ul><li>The best thing you can do to increase the odds of a successful financing is to move your business forward. Be careful about spending tons of time fundraising. </li></ul>
  • 7. International Companies have better chances of fundraising elsewhere <ul><li>Silicon Valley is the only region with too many good deals. Investors elsewhere HAVE TO invest outside their region, but we don't. So the bar is much higher... </li></ul><ul><li>So non Silicon Valley companies might be better of fundraising in places such as London, New York or Boston. </li></ul>
  • 8. &quot;You are too early for us... ” and other excuses… <ul><li>Most investors do deals when they get excited by them. But they don't like to say &quot;i am not excited&quot;, so instead they use an easy excuse, such as: </li></ul><ul><li>- You are too early </li></ul><ul><li>- The deal is too small </li></ul><ul><li>- I want to see more customers/revenues/technology </li></ul><ul><li>Be careful about trying to solve their excuses, because once you do they are likely to find others. Instead, figure out how to get them excited. </li></ul>
  • 9. A Few Random Thoughts…
  • 10. Speed is overrated! <ul><li>What good is going fast in the wrong direction? </li></ul><ul><li>The better you understand where you need to go, the faster you can move </li></ul><ul><li>But, never stand still! </li></ul>
  • 11. Don ’t believe what you Read <ul><li>Most success stories are made with 20/20 revisionist hindsight </li></ul><ul><li>It often takes time, e.g. StumbleUpon, OpenTable were not overnight successes as some people think… </li></ul><ul><li>20/20 Hindsight gives great strategic vision. Realistically, successes are built incrementally. </li></ul><ul><ul><li>So, don’t obsess over your world domination vision. Just make sure you have a vision for a small success – from which you will be able to build a larger one. </li></ul></ul>
  • 12. You can’t literally follow all the advise that you get <ul><li>There are many ways of building companies </li></ul><ul><li>You must find the approach that works for you </li></ul><ul><li>Advise should help you gain insights and to experiment </li></ul><ul><li>It is the same for competitive athletes… </li></ul>
  • 13. Hire Slow & Fire Fast <ul><li>The moment you start thinking someone might not be working out, he/she most likely isn’t </li></ul><ul><ul><li>But letting someone go is difficult and painful for everyone, so…, take your time hiring. </li></ul></ul>
  • 14. Take advantage of opportunities - but be careful about where you end up <ul><li>IPRO story: </li></ul><ul><ul><li>Started with consumer analytics </li></ul></ul><ul><ul><li>Followed customers to traffic auditing </li></ul></ul><ul><ul><li>Became World leader Web traffic auditor </li></ul></ul><ul><ul><li>BUT… </li></ul></ul><ul><ul><li>That turned out to be a lousy business! </li></ul></ul><ul><li>Make sure you enjoy the road </li></ul><ul><ul><li>People, product, learning, fun… </li></ul></ul>
  • 15. Focus on your most important market from the start <ul><li>Be careful about starting with the “local” market. You might get stuck there and never quite make it to the larger markets </li></ul><ul><li>If you want to be a global player, focus on a large market, such as the US or Brazil, from the start </li></ul>
  • 16. Moving to Silicon Valley? <ul><li>PLUSES: </li></ul><ul><ul><li>The “center of the universe” </li></ul></ul><ul><ul><li>Money </li></ul></ul><ul><ul><li>Experts </li></ul></ul><ul><ul><li>Partners </li></ul></ul><ul><ul><li>Customers in some cases </li></ul></ul><ul><ul><li>A “must do” in some spaces </li></ul></ul><ul><li>MINUSES: </li></ul><ul><ul><li>Much harder to hire talent </li></ul></ul><ul><ul><li>More expensive? </li></ul></ul><ul><li>MIDDLE GROUND: </li></ul><ul><ul><li>Come for a while - or come frequently </li></ul></ul><ul><ul><li>Send some of your team </li></ul></ul>
  • 17. Leveraging Silicon Valley <ul><li>Help us help you </li></ul><ul><ul><li>Do your homework </li></ul></ul><ul><ul><ul><li>The right people to talk to </li></ul></ul></ul><ul><ul><ul><li>The topics you want to discuss </li></ul></ul></ul><ul><ul><li>Be Specific </li></ul></ul><ul><ul><li>Add value </li></ul></ul>
  • 18. Investors Back People not Presentations <ul><li>A presentation is like a resume, a door opener, a conversation starter… </li></ul><ul><li>What really matters is the people and the business, not as much how they present </li></ul><ul><li>Make sure your presentation doesn’t get in the way, but don’t over-optimize it… </li></ul>
  • 19. Questions? @ariel www.octaven.com

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