VENTURE51 PITCH DECK VENTURE51 SUMMARY available upon request VENTURE51 PITCH DECK VIEWINGVENTURE51 INVESTMENT STRATEGY available upon request VENTURE51 PROCESS & SYSTEMS available upon request “We are inventing the future, think about surfing on the front edge of a wave. It’s really exhilarating. Now think about dog-paddling at the tail end of that wave. It wouldn’t be anywhere near as much fun. Come down here and make a dent in the universe.” -Steve Jobs
DISCLAIMERThis PitchDeck provides an overview of Venture51 Capital Partners Fund II (“Venture51 Fund II”) which is being sponsoredby Venture51 Capital Fund, LLP (“Venture51”). Brandon Zeuner and Ryan Swagar are the managing partners of Venture51Capital Fund, LLP. This document brieﬂy describes the expected investment program of Venture51 Fund II. It also describesthe expected principal terms of Venture51 Fund II and the offering of securities to investors.All information contained herein is subject to revision, structuring and completion, and this document does not constitutean offer to sell or solicitation of an offer to buy any securities. Any such offer or solicitation will be made only by means of aformal Conﬁdential Memorandum that will be prepared and furnished to prospective investors at a later date. In the eventof any such offering, the information contained herein will be deemed superseded and amended in its entirety by suchConﬁdential Memorandum. Any decision to invest should be made solely in reliance upon such Conﬁdential Memorandum.The specialized investment program of Venture51 involves signiﬁcant risks, which will be described in the ConﬁdentialMemorandum.This document is conﬁdential, proprietary and is intended solely for the information of the person to whom it has beendelivered by Venture51 Fund II. It is not to be reproduced or transmitted, in whole or in part, to third parties without theprior consent of Venture51. This booklet is not intended to constitute legal, tax or accounting advice or an investmentrecommendation.
A NEAR-PERFECT STORM IS FORMING2.276B PEOPLE ON THE WEB 2B SMART DEVICES BY 2015 2.267B people on the web today MOBILE • • growth from 2000 to 2012 projected at 527% WEB • 2B smartphone users by 2015 • only 32.7 % penetrated MATURES MAINSTREAMS • projected growth at 175% YoY STRONG TECH ECONOMY BILLION USER SINGLE PLATFORM • early stage capital ﬂowing • M&A activity holding steady • IPO liquidity emerging • platform maturity with facebook, google, apple, and amazon • facebook to reach 1B users
WHAT WE LEARNED Investing in 37 companies and 3 funds validated 4 key beliefs to generating venture returns. SERIES A MEANINGFUL TECHNICAL GEOGRAPHY BOTTLENECK OWNERSHIP FOUNDERS MATTERS Sweet spot forming with a Series A crunch Outsized returns are generated by having the Best performing companies have Geographies still play a critical factor in happening by an overabundance of seed right level of ownership and a meaningful level technical founders composed of meaningful outcomes. The Bay Area,round ﬁnancings in the past 3 years (largely of follow-on participation. We’ve upgraded our engineers, designers and growth hackers. Souther California and New York still due to Angels and Super Angels). Lack of strategy from “access” to “ownership”. All technical founders or early employees. remain core tech hubs. ﬁrms to follow-on after the seed and before the A presents a lucrative opportunity.
INVESTMENT STRATEGY Based on our experience in Fund 1, we are upgrading our strategy for Fund 2 to focus on 3 key areas. TRACTION GAP FOCUS ACCESS TO OWNERSHIP HYBRID APPROACH Outsized returns are generated by having the right A critical combination – neither operating experience or Post seed round - pre series A round presents an level of ownership, and a meaningful level of pattern matching alone is enough (e.g. “I’ve seen this interesting opportunity for funds to tap an follow-on participation, in your portfolio before, but I don’t know what to do”). overheated seed marketplace. companies.SEED ROUND A ROUND > > 7% > 5% = 8% = = SEED ROUND A ROUND B ROUND TRACTION GAP UPGRADE OPERATIONAL DATA-DRIVEN upgraded our strategy from access (“get in the EXPERIENCE ANALYSIS good deals”) to ownership (“buy/keep enough of each company that any positive outcome is meaningful to the fund Qualitative Work Quantitative Work $250K - $750K ROUNDS based on instincts, based on data and insights and intuitions predictive analytic models only gained from which help to guide scale growth model operational backgrounds investment decisions prove business model build value shop Series A
MARKET DISPLACEMENT Our portfolio crosses 8 themes and is generally stacked on 5 strategic models MOBILE MONETIZATIONDIGITAL HOUSEHOLD MOBILE ECOSYSTEM EDGE ENTERPRISE NEW COMMERCE HEALTH & SELF PROFESSIONAL PLUMBING EDU-TECH Access to people, content Apps are cool, but they The edge of the SMB and The old models of e- The forces of software Legacy software are being Computers are talking to An industry that is emerging and digital assets. Anytime. don’t change the world. departmental enterprise commerce are changing changing the healthcare eaten by newer and better each other more and more. to supplement or outright Anywhere. Platforms that facilitate the where software has a with the rise of group- and wellness industries. alternatives in the Financial, There’s a software layers replace traditional education mobile movement in terms network effect in its buying, micro-payments and The focus of the quantiﬁed Legal and Healthcare that brings these pipes to services from early of monetization, proliferation in the business. collaborative consumption. self will give rise to a new markets. Traditional systems the surface and allows childhood through adult development and breed of personal metrics. and processes are being others to build on them. learning. infrastructure do. overtaken rapidly. MODEL STACK COMMERCE, SUBSCRIPTION MARKETPLACES, COLLABORATIVE CONSUMPTION HUMAN COMPUTER INTERACTION BIG DATA, COLLECTIVE INTELLIGENCE PLATFORMS, MONETIZATION
KEY INVESTMENT CRITERIA Our thesis around our investment criteria falls into 6 major categories. We spend our time in the diligence phase proving and disproving these assumptions.MARKET POTENTIAL TRACTION REMARKABLE PRODUCT TEAM GEOGRAPHY CAPITAL EFFICIENTIs the most important factor in a Quantitative evidence of market An addictive user experience Ideally a composition of a Primary focus is the Bay Capital efﬁciency in thestartups success or failure. In a demand. Demonstrated lies in the combination of backend engineer, front-end Area, New York, and early stages is key togreat market -- a market with lots product/market ﬁt. human values including engineer and a growth Southern California. commercial success. Whenof real potential customers -- a desirability and usability, engineer. This technical trio a company is scaling forgood market always pulls business viability, and will either carry founder growth, its critical to reserveproduct out of potential breakout technology feasibility. Design shares or have high ﬁrst- plenty of runway by keepingstartups, not the other way innovation, aka the Unfair employee ownership in the the burn low.around. Market is king. Design Advantage, lies in the company. sweet spot between the complimentary priorities.
TEAM Core operating team ryan SWAGAR brandon ZEUNER boz BUNDALO zach HAMILTONMANAGING PARTNER MANAGING PARTNER TECHNICAL PARTNER ASSOCIATEco-founder of Venture51, co- co-founder of Venture51,co- partner at Venture51, co- hustler at Venture51, co-founded Republic Project, founded Republic Project, founded Upward. Founding founder of Homely, &co-founded Upward. co-founded Upward. team at Republic Project, MBerry. #Surfer #Skier#Canadian #Golfer #Skier Interact (makers of ACT! & unicorn engineer & designer#Surfer SalesLogix - sold to Sage in #designexpert, #technical ’01), Flypaper (Acquired in guru #wikedsmart ’11), #Golfer #Skier #Surfer RESUME RESUME RESUME RESUME extended team DARRIN S. BROWN ALAN BALDACHIN MATT STOVER TODD BARNHART GUNDERSON DETTMER HBALLP MG STOVER SILVERHAWK FINANCIAL Fund Legal Council Fund Deal Council Compliance & Reporting CFO