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Funding your ideas (angel or VC) - thoughts and ideas

Funding your ideas (angel or VC) - thoughts and ideas






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    Funding your ideas (angel or VC) - thoughts and ideas Funding your ideas (angel or VC) - thoughts and ideas Presentation Transcript

    • Funding your ideas…
      T.A. McCann
    • I just like to start things,
      go fast and push the technical limits,
      and work with great teams
      to create incredible results
    • Incubation
      Microsoft - Hosted Exchange, MS Anti-spam, Exchange 2003, Mobile SDP (think iPhone app store), MSR
      Polaris - started Message Gate and worked on ideas like Evenflow, OutlookBI and HelpShare
      New companies including MOD Systems and Jump2Go
      Vulcan (Evri – Virtual Worlds, Faceweb, Gist)
      30-60-90 plan
      Triage, Plan, Prototype, 4Ps of marketing, Company or Kill
      Lessons learned: it always takes longer, pick a customer you want to embrace,
      Know your own space
    • Where does it come from…
      Your bank account
      Bootstrap (work for hire)
      Bootstrap from customers
      Strategic investment by partners/customers
      Choose what you need and can get…
      The bigger the idea, the more latitude and connections and experience you will need to succeed
    • So, you really want investors….
      Angles take just as much time as VCs
      Relationships are key;
      develop them now with all funding sources
      vet your ideas, early and often, discover your champions
      Other CEOs are your friends, leverage them
      Your plan is your plan
      Raise money at the right time
      Plan – Promise – Prototype – Product – Performance
    • VC is about smart money…
      Accelerates value as soon as they get involved
      Brings smarts and experience to help to drive
      Actively engages with your product and market
      Brings credibility, higher likelihood of more funding
      Brings people, knowledge, connections
      Know what you are looking for (skills)
    • It’s a sales process
      Qualify your prospects
      Who you know, focus on personal intros
      Previous investments/success in the space
      General beliefs about future innovation (in your space)
      Key connections with thought leaders (in your space)
      Fund progress
      $ total size, allocation, room for new investments, stage focus
      Current success
      Decision makers and process
      Board member – how many boards, of what type, activity, commitment
      Do your diligence on the person, find other CEOs
      Drive the process and timeline
      Align to the calendar (your milestones, their rhythm)
      Show a vision (not too much)
      Define a horizon and hit it
      Create competition for your deal
      Gang up your work, you need to drive the process
    • Why you…
      25% of the VC decision is out of your control
      Wrong space, wrong size, wrong partner, wrong metrics, wrong time, already invested, once burned…
      You have the goods, act like it – exude confidence
      My read on their decision
      50% is the guy/team – smart, passionate, credible, connected, leader, motivator, tactical/strategic….
      25% is the space/idea – how big, how much risk, how many other players, capital risk, likely exits…
      25% is the progress, execution – can you get stuff done, good decisions, efficient with capital…
    • Summary
      If it were easy everyone would do it
      Love your customers more than your idea
      Raise the smartest money you can
      Know where to spend and save
      If you were rich, would you still be doing it?
    • T.A. McCann
    • Strategy – magic quadrant
      Create the smallest circle that is big enough
      You can only change 1 thing/quarter
      This is your elevator pitch
      Lessons learned: it should not be complicated
    • Strategy – know your customer
      Personify your customer
      Focus on pain vs. opportunity
      Know 10-50 by name
      Sell them your PPT
      Make sure they pay
      Understand their toolset
      Determine their buying habit and timeline
      Lessons learned: this is the fun part and you should love it, iterate quickly
    • Operations
      Plan and Pitch in PPT (lies), Operate in Excel (truth)
      Time bound and list your goals – stay honest with yourself
      Deliver email status updates every 2 weeks to your investors/board/advisors
      Always cut yourself off one quarter earlier than you need and 2 quarters before you think you should
      Lessons learned: good entrepreneurs will make too many sacrifices
    • Team
      Winning the Americas Cup is like running a startup
      Value = 5(passion) + 2(brains) + 1(experience)
      The best advisors are only one small step away from conflict of interest
      Outsource routine tasks, hire for thought leadership
      Know your service providers (Atlas, Fenwick…)
      Startups should never partner with startups
    • You are the VP of Marketing
      Make yourself a brand and thought leader
      Goto and present at conferences
      Become a guest contributor
      Communicate online and in-person
      Blog (1-2 per month)
      Twitter (1-2 per day, blend of personal, content and business)
      Facebook (connect to Twitter and your blog)
      Understand what resonates, the message the space and timing, the competition
      Sell, Sell, Sell your idea and yourself
    • Tools that cost very little money
      Open source stack
      Prototype + LowPro, Ruby/Rails, Java, AMQ, MySql
      Textmate/Netbeans, SVN, Rspec, CruiseControl
      Google is our friend
      Google Domains (mail and docs)
      Google forms (interview and VC feedback tracking)
      App engine – web site hosting
      Analytics – web data tracking
      PBWiki – corporate plans and broad strategy, Unfuddle – bug and feature database and Skitch – screen caps and comments
      Soft Layer – hosting, Amazon S3 – storage
      Survey Monkey - end user surveys, Vertical Response – keeping the beta users engaged and GotoMeeting- presentations, TweetDeck– monitoring the Twitter stream