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CeBIT-Australia-2016-anne-marie-birkill-startup

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CeBIT Australia 2016

StartUp Conference
CeBIT Keynote - Anne-Marie Birkill

Published in: Technology
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CeBIT-Australia-2016-anne-marie-birkill-startup

  1. 1. High Growth Technology Opportunity: CONFIDENTIAL 1 10 tips to secure funding for your start-up 4 May 2016 CeBIT Australia 2016
  2. 2. High Growth Technology Opportunity: CONFIDENTIAL Agenda • Which funding option is best for your business? • 10 tips for securing funding 2
  3. 3. Where could your business be in 5 years? What is your ambition? Do you want to • be a freelancer or an entrepreneur? • build a profitable SME? • lead and control a significant business that endures? • build a company and exit it at a profit? What potential does your business have • How big is the market? • How much competition? • How good is your solution? • Do your ambitions and your business’s potential align? The answer to this important question will determine how you fund the growth of your business 3
  4. 4. High Growth Technology Opportunity: CONFIDENTIAL What do you need besides a “big idea”? 4 NB: attributed to “Breathing Buildings”, published at University of Cambridge for Enterprise Tuesday
  5. 5. High Growth Technology Opportunity: CONFIDENTIAL 5 What are the various sources of funding? • Boot strapping/self funding • FFFF • Government grants (www.business.gov.au; www.innovationtoolbox.com.au) • Angel investors, groups and individuals (www.aaail.net.au) • Venture capital (www.avcal.com.au) • Banks • The share market
  6. 6. High Growth Technology Opportunity: CONFIDENTIAL How do they differ? Source Investment criteria Expectations Timeframe FFFF Typically investing to support you A financial return – maybe May be open ended Government grants Typically an economic development tool Reporting. Creation of sustainable Australian business, jobs Varies: 6 months to several years Crowd Funding Retail market likes and validates opportunity None/rewards/future equity? Can be quick Angel investors Often investing in areas of personal interest Equity. Hands-on involvement, financial return (circa 30% IRR) Often patient: 3 plus years Venture capital Usually high growth potential technology based ventures Equity. Financial return circa 50% IRR 10 year cycle but typically 3-5 years Banks Usually require security Capacity to repay plus interest Varies – usually fixed term Sharemarket Many regulatory and conformance hurdles Capacity to meet ASIC, ASX and shareholder expectations including payment of a dividend Open ended if company performs (i.e. regularly pays a return) 6
  7. 7. High Growth Technology Opportunity: CONFIDENTIAL Tip 1. Self funding? Be disciplined • Invest every dollar as if it were someone else's • Be a good financial manager • Build and validate your business case • Set performance milestones and implement sound monitoring 7
  8. 8. High Growth Technology Opportunity: CONFIDENTIAL Tip 2. Grant funding? Follow the rule book • Do your homework! • Thoroughly review the options and assess your eligibility • Who has the agency funded previously? • Read the user guides • Answer all sections thoroughly, use data to support your points • If inexperienced, consider engaging professional assistance 8
  9. 9. High Growth Technology Opportunity: CONFIDENTIAL Tip 3. Crowd funding? Build a campaign • Crowd funding requires a marketing campaign • Conversion rates are 3% for successful campaigns, that is a lot of visitors • Be prepared to invest a lot of time and effort pre- and post- campaign 9
  10. 10. High Growth Technology Opportunity: CONFIDENTIAL Tips 4-10. Equity Funding? 4. Understand what drives investment decisions 5. Stand out from the crowd 6. Solve a compelling market need 7. Have a brilliant solution 8. Articulate the business model 9. Convince us you can execute (and exit) 10. Focus on the important investment terms 10
  11. 11. High Growth Technology Opportunity: CONFIDENTIAL Tip 4: Understand what drives investment decisions 11 Typical VC Fund Structure Equity investment in a private companies Return comes from capital gain Medium to long-term view (3-6 years) High Risk (many fail) – Target 30% IRR or 3-5x Specialty Managers, very ‘hands-on’ Very High Return (if successful)
  12. 12. High Growth Technology Opportunity: CONFIDENTIAL VCs target meaningful (LEAP) technologies – that solve big problems VCs look for • What is the Issue • What is your Solution • What is the Opportunity • People with passion • A large and growing market • A plan to get there • Barriers to entry – a unique solution • A profitable business model • The capacity to add value • Exit (at the right IRR) Tests of a new product • Valuable benefits test • Leadership team test • IP control test • Fitness for purpose test • Scale up test • Marketing, sales and channel to market test • Return on investment test Innovation for business success: Achieving a systematic innovation capability Professor Danny Samson, University of Melbourne 12
  13. 13. High Growth Technology Opportunity: CONFIDENTIAL 13 What you should expect • Equity investment – dilution of ownership • Tranches tied to performance milestones • Focus on commercial activities and practices • Shared control • Money plus expertise • To work together to build a business with a view to exit
  14. 14. High Growth Technology Opportunity: CONFIDENTIAL Tip 5. Stand out from the crowd Business opportunities are like buses, there’s always another one coming. – Richard Branson
  15. 15. High Growth Technology Opportunity: CONFIDENTIAL 15 Because we see hundreds of opportunities • OneVentures pipeline • 2000 opportunities • 1600 declined early • 9 investments
  16. 16. High Growth Technology Opportunity: CONFIDENTIAL Tip 6. Solve a compelling market need 16 OR ? And back that up with evidence
  17. 17. High Growth Technology Opportunity: CONFIDENTIAL Vaxxas: Needle free vaccine delivery 17 Issue: needle phobia, needle stick injury, cost of vaccines, cold chain, vaccine efficacy Solution: Nanopatch intradermal vaccine delivery Opportunity: $20+ billion dollar market, growing 15% per annum • Strong IP position with had significant benefits over the incumbent needle technologies and other intradermal approaches OneVentures • Identified the opportunity and market potential • Established the company • Lead $15M Series A financing – Sufficient funding to get to first human trials of the nanopatch device • Lead $25M Series B financing • Dr Paul Kelly Chair of Board • Negotiated the licensing deal with University of Queensland • Established the ongoing R&D services program with the University of Queensland • Constructed the syndicate to include a VC with vaccine specialisation and a US biotech VC based in Boston • Appointed CEO based in Boston USA • Supported the CEO in the negotiations with Merck USA
  18. 18. High Growth Technology Opportunity: CONFIDENTIAL Tip 7. Have a brilliant solution 18 And show us why it will win
  19. 19. High Growth Technology Opportunity: CONFIDENTIAL Smart Sparrow: teach smarter 19 Issue: e-learning is not supported by quality tools Solution: the MS office for e-learning Opportunity: multi-billion dollar market, growing • Due diligence showed a clear competitive differentiation and a global opportunity to be a market leader OneVentures • Migrated the company out of the University of NSW • Negotiated the licensing agreement the University • Put in place back office accounting and governance • Lead the $2M Series A financing in conjunction with Uniseed • Dr Michelle Deaker, Chair of Board • Negotiated $10M Series B financing • Hired the commercial director who signed/instigated $4.5M in contract revenue • Supported the CEO in implementing solid development processes and operations • Assembled a quality Board • Supported key hires in the US Smart Sparrow = learning by doing with rich feedback and analytics
  20. 20. High Growth Technology Opportunity: CONFIDENTIAL Tip 8. Articulate the business model 20 How will we build a business?
  21. 21. High Growth Technology Opportunity: CONFIDENTIAL Tip 9. Convince us you can execute (and exit) 21 Good people are the scarcest asset
  22. 22. High Growth Technology Opportunity: CONFIDENTIAL Tip 10. Focus on the important investment terms 22 Not just dilution
  23. 23. High Growth Technology Opportunity: CONFIDENTIAL 23 OneVentures Contact: Anne-Marie Birkill General Partner and Executive Director W: www.oneventures.com E: abirkill@oneventures.com OneVentures Pty Ltd Sydney | Brisbane I Boston STRICTLY PRIVATE & CONFIDENTIAL

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