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Deep impact2013 allconferenceslides Deep impact2013 allconferenceslides Presentation Transcript

  • Bypassing the banks – how crowdfundingcan make a Deep Impact Follow us @rebuildings
  • Crowdfunding – debt market Follow us @rebuildings
  • Industries alreadytransformed by the internet Follow us @rebuildings
  • We value productivity over speculation Follow us @rebuildings
  • My storyFollow us @rebuildings
  • Follow us @rebuildings
  • Bloom ... Venture Catalyst - growing the entrepreneurial eco-system
  • Bloom ... Venture Catalyst - growing the entrepreneurial eco-system
  • Bloom ... Venture Catalyst - growing the entrepreneurial eco-system
  • Bloom ... Venture Catalyst - growing the entrepreneurial eco-systemSeptember
  • Bloom ... Venture Catalyst - growing the entrepreneurial eco-system
  • Innovating or GrowingSustainablebusinesses,projects and Pitch oncommunities  Online www.Bloomvc.com  Light Touch  Big Impact Demonstrate Crowdfund seed or business model development capital
  • The power of the crowd… “Small gifts from many are just as powerful as large gifts from a few.” Steve Case, co-founder, AOL Bloom ... Venture Catalyst - growing the entrepreneurial eco-system
  • www.bloomvc.comBloom ... Venture Catalyst - growing the entrepreneurial eco-system
  • Darren WestlakeCrowdfunding Deep Impact 2013
  • The Status QuoA wealth of entrepreneurial talent• UK has lots of great ideas• Need to cultivate ideas into the next Google/Twitter/GroupOn Google says searches for• Often stifled by access to Money "business plan UK" have increased by 60% over the past year and searches for "small business loan" are up by 34%
  • The Status QuoThe Status Quo• Venture capital difficult to find for smaller requirements• Debt finance hard to come by• Business angels – limited investments • Typically a syndicate each investing £10k - £100k• What if there was a way to have say 5000 angels each investing £10?• What if anyone could become a business angel?
  • Crowdcube and CrowdfundingWhat is Crowdcube?• Crowdcube provides a web-based central hub for entrepreneurs to meet micro-investors. It uses the power of Crowdfunding to provide a unique service to two types of people: • for entrepreneurs to source funding more accessibly than conventional routes • for smaller investors to have the opportunity to invest in exciting high- potential businesses “$100 invested in Microsoft at their IPO would now be worth approximately $35k.”
  • Crowdfunding Crowdfunding• Crowdfunding is an approach to raising the capital required for a new project or enterprise by appealing to large numbers of ordinary people for small donations• Social Media• Crowdfunding examples • Kiva.org - $325m funding raised, >777,000 lenders, ~800,000 entrepreneurs • Kickstarter.com – >24,000 projects funded, > $250m pledged to-date, 2m people have pledged
  • Crowdfunding
  • How it works
  • How it works
  • How it works
  • BenefitsBenefits
  • Business modelSuccess so far… Deals successfully funded £5.1 million funded so far… £100,000 >30,000 largest single investment members£2,547 £1 millionav. investment FSA Authorised biggest deal
  • Thanks Questions?www.crowdcube.com
  • @BankToTheFuture@SimonDixonTwitt#BankToTheFuture
  • BC = BeforeCrowdFundingSources of Finance ForYour Company... FFF Early Seed £10- 50k
  • BC = BeforeCrowdFundingSources of Finance ForYour Company... OverDraft Post FFF Early Revenue Seed £10- £10- 50k £100k
  • BC = BeforeCrowdFundingSources of Finance ForYour Company... Angels OverDraft Seed / Post Early FFF Early Revenue Growth Seed £10- £10- £100-£1m 50k £100k
  • BC = BeforeCrowdFundingSources of Finance ForYour Company... VC Angels Growth £1m- OverDraft Seed / £25m Post Early FFF Early Revenue Growth Seed £10- £10- £100-£1m 50k £100k
  • BC = BeforeCrowdFundingSources of Finance ForYour Company... PE Mature Growth / Distresse VC d Growth Companie Angels s, MBO, £1m- OverDraft Seed / £25m M&A Post Early £25m- FFF Early Revenue Growth £100m Seed £10- £10- £100-£1m 50k £100k
  • BC = BeforeCrowdFundingSources of Finance ForYour Company... Equity Capital PE Markets Mature (ECM) Growth / Exit, Distresse Mature VC d Growth, Growth Companie Expansio Angels s, MBO, £1m- n £100m- OverDraft Seed / £25m M&A £5bn Post Early £25m- FFF Early Revenue Growth £100m Seed £10- £10- £100-£1m 50k £100k
  • BC = BeforeCrowdFundingSources of Finance ForYour Company... Debt Capital Equity Markets Capital PE (DCM) Markets Mature Public (ECM) Growth / Compani Exit, Distresse Mature es, d Countries VC Growth, Companie Expansion , Angels Growth ££££’s £1m- s, MBO, £100m- OverDraft Seed / £25m M&A £5bn Post Early £25m- FFF Early Revenue Growth £100m Seed £10- £10- £100-£1m 50k £100k
  • AD = After Debt CrisisSources of Finance ForYour Company... FFF £1k
  • AD = After Debt CrisisSources of Finance ForYour Company... CrowdFun d Seed/Idea FFF £1k Prototype £1k-£50k
  • AD = After Debt CrisisSources of Finance ForYour Company... CrowdLoa n Expansio CrowdFun n/ d Working Seed/Idea Capital FFF £1k Prototype £1k - £1k-£50k £100k
  • AD = After Debt CrisisSources of Finance ForYour Company... Crowd- Investmen CrowdLoa t Seed For n A Good CrowdFun Expansion Plan, d / Working Growth Seed/Idea Capital £10k-£1m FFF £1k Prototype £1k - £1k-£50k £100k
  • AD = After Debt CrisisSources of Finance ForYour Company... ECM DCM PE £100 £££’s £25 Crowd- m- m- Investmen VC £1m- £100 £5bn CrowdLoa t Seed For £25m m n A Good CrowdFun Expansion Plan, d / Working Growth Seed/Idea Capital £10k-£1m FFF £1k Prototype £1k - £1k-£50k £100k
  • info@banktothefuture.com@SimonDixonTwitt#BankToTheFuture
  • GOOD AFTERNOON!Ariadne Capital Limited is authorised and regulated by the U.K. Financial Services Authority
  • The Face of Every EntrepreneurThey just may not show it to you!
  • Two Good Reasons • They see the inevitable and advance the Future • They are willing to live abnormal lives
  • Capital Follows Ideas Always Has, Always Will
  • Remember the New Economy?Turns out it’s latest version of “New”
  • Economic Growth since the end of the 18th Century has gone through 5 Distinct Stages, associated with 5 successive Technological RevolutionsFive Successive Technological Revolutions, 1770’s to 2000’sTechnological Popular Name for the Core Country or Big-bang initiating the YearRevolution Period Countries revolutionFIRST The Industrial Britain Arkwright’s mill opens 1771 Revolution in CromfordSECOND Age of Steam and Britain (spreading to Test of the Rocket 1829 Railways Continent and USA) steam engine for the Liverpool-Manchester railwayTHIRD Age of Steel, Electricity US and Germany The Carnegie Bessemer 1875 and Heavy Engineering forging ahead and stell plant opens in overtaking Britain Pittsburgh, PennsylvaniaFOURTH Age of Oil, the USA (with Germany at First Model-T comes 1908 Automobile and Mass fist vying for world out of the Ford plant in Production leadership), later Detroit, Michigan spreading to EuropeFIFTH Age of Information and USA (spreading to The Intel 1971 Telecommunications Europe and Asia) microprocessor is announced in Santa © Proprietary & Confidential – Ariadne Capital Clara, CA
  • Lifecycle of a Technological Revolution Period one Period two Period three Period four Last new products and industries. Earlier ones approaching maturity and market saturationDegree of technology maturity and market saturation Full constellation (new industries, technology Full expansion of systems and innovation and market infrastructure) potential Early new products and industries. Explosive growth and fast innovations Gestation Paradigm Introduction of successive new products, industries Constriction Time period configuration and technology systems, plus modernisation of of potential existing ones Big-bang Around half a century © Proprietary & Confidential – Ariadne Capital
  • AGE OF IT AND TELECOMMUNICATIONS 50 ISH YEAR CYCLE – 1971 TO 20...?BIG BANG – NOVEMBER 1971 IN SANTA CLARA, CALIFORNIA • Bob Noyce and Gordon Moore launched Intel’s first microprocessor, the precursor of the computer on a chipINSTALLATION – late 1970’s through to Noughties • 1976 – Steve Jobs, Steve Wozniak found Apple Computer • 1984 - Michael Dell founds PC’s Limited later named Dell Computer Corporation • 1985 – Irwin Jacobs founds QualComm, pioneer in Wireless Communications • 1990 – CERN / Tim Berners Lee • 1994 – Yahoo founded • 2003 – Skype – “free calls on web” • 2004 - Facebook foundedTHE TURNING POINT © Proprietary & Confidential – Ariadne Capital
  • THE REVOLUTION STARTS AS A SMALL FACT WITH BIG PROMISE AND MOVES TO A SIGNIFICANT FORCE IN THE MARKET© Proprietary & Confidential – Ariadne Capital
  • Big Bangs attract new investment: successful radicalinnovations receive and promise extraordinary profits ina mature industrial landscape Turning Degree of diffusion of the technological revolution Point INSTALLATION DEYPLOYMENT The Installation Period is one of tense co- PERIOD PERIOD existence of two paradigms •Once a truly superior technology is available, with higher productivity and clear growth potential, the outcome in the medium term is practically inevitable. •First 2 or 3 decades of creative destruction after the Big Bang are increasingly turbulent and the benefits of growth uneven. Time Big-bang Next big-bang •A new context is being created; a new common sense is emerging. •The world of computers and the Internet is very different than the world of the car, mass production and the highway. © Proprietary & Confidential – Ariadne Capital
  • The dynamics of the system: three spheres of change inconstant reciprocal action ECONOMIC CHANGE INSTITUTIONAL CHANGE Socio-political Production ideas & behaviour capital Financial Socio-institutional capital frameworks TECHNOLOGICAL CHANGE Technological revolutions Techno-economic paradigms© Proprietary & Confidential – Ariadne Capital
  • Technological Revolutions • 1999 – David with his slingshot wants to kill Goliath
  • The Economy & Social Institutions Respond • 1999 to 2013 – Broadband and Mobile Technologies continue to invade our lives • 2013 -David and Goliath must dance
  • Consumerisation of TechnologyAriadne advised Skype on business development activity in 2003 and 2004The consumers adoption of services is driving everything, reversing how new products and services used to come to market through the enterprise. User Client Developer Supplier
  • Raymond Kurzweil The Singularity is Near • Technology operates exponentially while our minds operate linearly • It took 89 years for the fixed line telephone to achieve an adoption of 150 million users, but only 38 years for the television to get to the same point. The mobile phone achieved this in 14 years, the iPod in 7, and Facebook in 5. • 20,000 years of progress this century. • At a certain point, we have to leverage technology or artificial intelligence to continue to model or predict the future
  • The David / Goliath Grid Model NetworkStrategic EffectsValue When partnering with, When acquired, Ecosystem 1)Brings new 1)Can become “David” - Digital Enabler EconomicsTM – shifting digital revenues industry 2)Can reinforce or players 2)Brings lean operating gain a position as system Industry Architect Consumer – Data sets become prevalent Network – Orientation at heart of the consumer insight Renting Operating System Not Licensing to the industryVulnerability “Goliath” - Distribution Financial Value Copyright - Ariadne Capital 75
  • Examples of Corporates engaging with Digital EnablersLarge corporates which are partnering and/or acquiring digital technology firms include:
  • Software is Eating the World - Marc Andreessen© Proprietary & Confidential – Ariadne Capital
  • GIVEN ALL THAT!WHAT IS THE INVESTMENT OPPORTUNITY?
  • WE HAVE A CUNNING PLAN© Proprietary & Confidential – Ariadne Capital
  • Innovation is about EconomicsNot TechnologyOtherwise we’d all be flying the ConcordeBut we’re packed into Jumbo Jets
  • Network-orientation to business
  • and Ecosystem Economics• Google says that they organise the world’s information• They actually organise the economics of the world’s information• I, as a consumer of their search, am not given any economic upside in the search transaction.• They have built a multi-billion pound business using – albeit anonymously – my personal data – aggregated with that of others, but releasing none of the economic value to me• Their biggest Achilles Heel is if someone in the search space were to cut a different set of economics for the consumer• Ariadne Capital found that entrepreneur – John Paleomylites – founder of BeatThatQuote, and sold his business to Google on the 4th of March 2011 for a 122 EBITDA multiple for these reasons
  • 84Monitise – The De Facto Leader 1.6 bn+ transactions pa 300+ FIs & Partners 17m FIs Registered customers $20bn Value of World leading partnerships 700+ payments & Mobile Money Experts transactions pa © 2003 – 2012 Monitise plc. All Rights Reserved.
  • has created The Mobile Money Ecosystem over the past 9 years Cards Processor Payments • Domestic• International Mobile TopUp Enabler 3rd Party Providers • Sharedealing • Insurance Mobile Operators National Use of standard Interfaces Services • Transit • Utility Other eg Core • CRM Banking Wealth • Database Shopping & Loyalty Bank Platforms
  • 86 What is Mobile Money? The opportunity is to meet a range of key consumer needs through their mobile Underpinned by bank grade technology & security © 2003 – 2012 Monitise Group Limited. All Rights Reserved. Confidential.86
  • Convergent CommerceFinancial Institutions Mobile• Banking/ Alerts • Mobile Prepaid• NFC/ Remote • Remittances• Offers • App Markets• Remittance • NFC/ Private Label • Remote Direct BillSocial Media and Retail Transportonline advertising Ticketing• Mobile OS • Mobile Checkout• Marketing Apps • NFC/ Proximity• LBS Services • BarCode/ Text Purch • Networking • Offers/ Promotions • Offers • Shopping Apps/ Mobile Web
  • Five Stages of Company Development Phase 1 Phase 2 Phase 3 Phase 4 Phase 5 Scale on the back Validate Business of the Enterprise High Growth Idea Product Model; Operating Sustainable Business Platforms and Model Set to Scale Corporate Partners ACE Fund investment focus © Proprietary & Confidential – Ariadne Capital 88
  • In 2013, “Network Benefits” accrue to those Firmswho understand their role in their ecosystem andorganise the economics for itThis in turn leads to exceptional returns for theirshareholders 89
  • Individual Capitalism is the Force for the 21stCentury “Capitalism was about empowered authority which didn’t necessarily activate the citizenry; the Internet stands that on its head, and shifts the power to the Individual – making Individual Capitalism the force of the 21st Century”.
  • So I say it’s really very simple.... Follow The Entrepreneur • He/She has the Market Insight • He/She is the Creator of Value • He/She is the Hero© Proprietary & Confidential – Ariadne Capital
  • Thank you .... julie@ariadnecapital.com www.entrepreneurcountry.comhttp://www.entrepreneurcountryforum.com 93