Tech Law For Startups: Angels or dragons? Preparing your business for investment

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Slides from a presentation by @dugcampbell to the @techlaw4startup group on 6th April 2011 about how to seek funding for your startup

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Tech Law For Startups: Angels or dragons? Preparing your business for investment

  1. 1. TECH LAW FOR STARTUPS<br />Angels or Dragons? <br />How to prepare your business for investment<br />DUG CAMPBELL<br />MBM COMMERCIAL LLP<br />6TH APRIL 2011<br />@dugcampbell<br />@techlaw4startup<br />
  2. 2. PREPARATION IS KEY<br />@techlaw4startup<br />2<br />
  3. 3. FUNDING OPTIONS<br />BOOTSTRAPPING<br />GRANT FUNDING<br />DEBT FUNDING (BANKS etc.)<br />ALTERNATIVES: REVENUE<br />BUSINESS ANGELS<br />VENTURE CAPITAL <br />@techlaw4startup<br />3<br />
  4. 4. WHAT IS A BUSINESS ANGEL?<br />“SMART” MONEY<br />EXPERIENCE/CONTACTS<br />CREDIBILITY & LEVERAGE<br />LOCATION<br />SYNDICATES<br />ACTIVE/PASSIVE<br />DECISIVE: TIMESCALES<br />EIS<br />@techlaw4startup<br />4<br />
  5. 5. WHAT DO YOU NEED TO SHOW?<br />SOLID POTENTIAL FOR RETURN<br />GOOD PLAN FOR THE CASH<br />WINNING ATTITUDE<br />SEASONED TEAM<br />COMPETITIVE EDGE<br />WELL-DEFINED EXIT STRATEGY<br />@techlaw4startup<br />5<br />
  6. 6. FIND THE RIGHT ANGELS<br />PERSONAL CHEMISTRY<br />DEEP POCKETS<br />LOCATION<br />CO-INVESTMENT<br />STAGE<br />@techlaw4startup<br />6<br />
  7. 7. BUSINESS PLAN<br />TEAM/TECH/TRACTION<br />EXECUTIVE SUMMARY<br />GROWTH POTENTIAL<br />FORECASTS <br />COMMITMENT<br />ROUTE TO MARKET<br />EXIT STRATEGY<br />FINANCIAL PROMOTION / FSMA<br />@techlaw4startup<br />7<br />
  8. 8. THE PITCH<br />THE 10/20/30 RULE (Guy Kawasaki)<br />1. PROBLEM 6. COMPETITION<br />2. SOLUTION 7. TEAM<br />3. BUSINESS MODEL 8. PROJECTIONS / MILESTONES<br />4. UNDERLYING MAGIC 9. STATUS & TIMELINE<br />5. SALES & MARKETING 10. SUMMARY /CALL TO ACTION<br />@techlaw4startup<br />8<br />
  9. 9. THE INVESTMENT PROCESS<br />TERM SHEET<br />DUE DILIGENCE<br />INVESTMENT AGREEMENT<br />ARTICLES OF ASSOCIATION<br />DISCLOSURE LETTER<br />SERVICE CONTRACTS<br />INTELLECTUAL PROPERTY<br />@techlaw4startup<br />9<br />
  10. 10. INVESTMENT AGREEMENT<br />MONEY IN RETURN FOR SHARES<br />WARRANTIES (LIMITS)<br />CONSENT MATTERS<br />UNDERTAKINGS<br />INFORMATION RIGHTS<br />INVESTOR DIRECTOR/OBSERVER<br />MONITORING FEE<br />RESTRICTIVE COVENANTS <br />@techlaw4startup<br />10<br />
  11. 11. ARTICLES OF ASSOCIATION<br />APPROVED ISSUES<br />COMPULSORY TRANSFER<br />GOOD/BAD LEAVER<br />DRAG/TAG PROVISIONS<br />@techlaw4startup<br />11<br />
  12. 12. WHICH WILL ALL LEAD(HOPEFULLY) TO...<br />@techlaw4startup<br />12<br />

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