Case Study: Bootstrap vs. Venture Funding

1. Case Study: Bootstrap vs. Venture Funding How did FitBit, Inc become market leader with organic growth

2. Case Study: Bootstrap vs. Venture Funding What we will see today 2 Agenda © 2015, ANAGARD, LLC 1 2 3 4 About Us Bootstrap vs. Venture Funding Case Study: Fitness Trackers FitBit vs. Jawbone 5 6 Go-to-market Strategy Contact Us Business Growth Consulting for Startups & Small Businesses Overcapitalization may lead to managerial complacency FitBit, Inc market leader in less than 2 years Minimal vs extensive venture funding Customer acquisition Quality

3. Case Study: Bootstrap vs. Venture Funding Download case study document 3 Watch this presentation © 2015, ANAGARD, LLC Watch a presentation Download a case study document http://www.anagard.com/blog/2015/05/06/case-study-bootstrap-vs-venture-funding/

4. Case Study: Bootstrap vs. Venture Funding For Startups and Small Businesses 4 ANAGARD, LLC: © 2015, ANAGARD, LLC Our approach Tested and validated value proposition is the fundamental building block to a successful business How will you serve your customers and make money BUSINESS MODEL Market Research Customer Discovery PRODUCT-MARKET FIT Define customer segment, their problems, and the advantage of using your solution over currently available ones in the market VALUE PROPOSITION

5. Case Study: Bootstrap vs. Venture Funding For startups and small businesses 5 ANAGARD, LLC: BUSINESS GROWTH CONSULTING © 2015, ANAGARD, LLC Our Services MARKET RESEARCH Customer Discovery Target Market Segment Competition BUSINESS PLANS Business plan document doubles probability of funding, yet only 40% of companies have one. Business Plan Evaluation & Development Business Model Canvas INVESTOR-READY CONSULTING Reduce time needed to raise funds Pitch-book Business Model TECHNOLOGY COMMERCIALIZATION Platform Technology developed by researchers or academics Find Technology-Product-Market Fit

6. Case Study How did FitBit, Inc grew organically to be a market leader

7. How did FitBit Bootstrap its Way to a Market Leader FitBit has raised only $83.8M from investors and have captured 70% of the market within three years. Rival Jawbone, has raised well over $518M and captured only 19% of the wearable fitness trackers market. Case study: wearable fitness trackers Sufficient Venture Capital Investments Do Not Guarantee Business Success in the Market Place 7 Bootstrap vs. raise money from venture capital investors © ANAGARD, LLC

8. Case Study: Bootstrap vs. Venture Funding 2014 Market Share 8 Wearable Fitness Trackers © 2015, ANAGARD, LLC 3% 8% 19% 70% FitBit Jawbone Nike FuelBand Others Launch Dates FitBit and Jawbone November 2011 Nike FuelBand, January 2012 Discontinued April 2014 70M units shipped in 2014

9. For 3 times less market share 9 Jawbone raises 6 times more money than FitBit © ANAGARD, LLC FitBit, Inc Raised $83.8M 70% Market Share in 2014 Ŵ Jawbone Raised $515.8M 19% Market Share in 2014 Ŵ $0M $50M $100M $150M $200M 2006 2007 2008 2009 2010 2011 2012 2013 2014 $0M $13M $25M $38M $50M 2008 2009 2010 2011 2012 2013 2014 2015

10. $83.M venture funding, over $300M net income in just two years 10 Hockey Stick Growth © ANAGARD, LLC FitBit, Inc Raised $83.8M and grew it to $750M in revenue 70% Market Share in 2014, grew it to 85% by March 2015 Ŵ $0M $13M $25M $38M $50M 2008 2009 2010 2011 2012 2013 2014 2015 • Profitable in 2013 • $130M Net Income in 2014 • $170M Net Income projected for 2015

12. Case Study: Bootstrap vs. Venture Funding Jawbone ignored Android users in the first year 12 Size of the Ecosystem Matters © 2015, ANAGARD, LLC FitBit, Inc Jawbone 40% of all smartphones in 2012 were Android phones Jawbone ignored almost half of potential market size for a full year

13. Case Study: Bootstrap vs. Venture Funding Utility trumps beautiful design 13 Quality Matters © 2015, ANAGARD, LLC “The UP No Questions Asked Guarantee” Poor hardware design lead to immediate widespread device replacements HARDWARE DESIGN Jawbone emphasized beautiful design over R&D vigor, and operational efficiencies R&D Dissatisfied customers CUSTOMER SERVICE

14. Case Study: Bootstrap vs. Venture Funding Smartphone and tablet app, website interface, paid premium analytics 14 Access to customer analytics © 2015, ANAGARD, LLC FitBit, Inc Jawbone Multiple platforms let customers gain insight into their fitness and nutritional goals

16. Case Study: Bootstrap vs. Venture Funding Planning IPO vs fending off creditors 16 Spring 2015 © 2015, ANAGARD, LLC Planning $100M IPO March 31, 2015: increased market share to 85% S-1 filing Launched UP3 after 6 months delay Fending off creditors VC backed out from equity financing, claim money was loan Suing FitBit for poaching employees & IP

17. Case Study: Bootstrap vs. Venture Funding For 30-minutes long complimentary discovery consultation 17 Contact Us © 2015, ANAGARD, LLC 9360 Falls of Neuse Rd Suite 205 Raleigh, NC 27615 Phone +1-919-876-1314 twitter.com/DraganaMendel plus.google.com/+AnagardBizGrowth linkedin.com/company/anagard-llc www.ANAGARD.com info@ANAGARD.com

Case Study: Bootstrap vs. Venture Funding

Case Study: Bootstrap vs. Venture Funding

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Case Study: Bootstrap vs. Venture Funding