Krypton VC discusses investing in startups and the startup ecosystem. They explain different types of investors like angels, VCs, and funds. Company stages are defined from seed to revenue growth. Israel is highlighted as having many startups, with over 5,000 active and 600 new ones each year. The presentation discusses evaluating startups and using mass intelligence to efficiently invest in those with working proofs of concept and committed teams serving real market needs. The goal is avoiding wasted time and investment by thoroughly vetting opportunities upfront.

2. Do you have a Start Up company?
Do you know someone who has a Start Up
company?
Quick Warm Up Question – Please Raise You Hands

3. Israeli’s Answers – 100 People 350 Hands Up !

4. Krypton VC - Our Name

5. Are Finance People Smarter ?
No One Is Smarter Than All Of You Together!

6. We Do Not Speculate - We Win!
Mass Intelligence

7. Game Plan
1. Start Up Ecosystem
2. Start Up Ecosystem - Israel
3. “Venture Capital Behind The Scenes” - BtoC
4. Get To Know Your Competitor
*Krypton Investment Mechanism

8. Start Up Ecosystem - Investment Entities - “Suits World”
1. Angel Investor
2. Corporate Venture Capital (CVC)
3. Equity Fund
4. Fund of Funds
5. Hedge Fund
6. Holding Company
7. Incubator
8. Investment Company
9. Management Company
10. Mutual Fund
11. Secondary Fund
12. Turnaround Fund
13. Venture Capital (VC) Fund
14. Venture Capital Limited Partnership

9. 1. Angel Investor - An individual who provides capital to one or more startup companies
2. Corporate Venture Capital (CVC) - A subsidiary of a large corporation, which makes venture
capital investments
3. Equity Fund - A fund which invests primarily in stocks, usually common stocks
4. Fund of Funds - A fund which invests in other funds.
5. Hedge Fund - A fund, usually used by wealthy individuals and institutions which is allowed to
use aggressive strategies that are unavailable to mutual funds, including selling short,
leverage, program trading, swaps, arbitrage, and derivatives. Since they are restricted by law
to less than 100 investors, the minimum investment is typically $1 million. The general
partner usually receives performance-based compensation. Hedge funds are not common in
Israel.
6. Holding Company - A company that owns enough voting stock in another firm to control
management and operations by influencing or electing its board of directors. Also called a
parent company.
7. Incubator A company or facility designed to foster entrepreneurship and help startup
companies, usually technology-related, to grow through the use of shared resources and
intellectual capital
Start Up Ecosystem - Investment Entities - Detailed

10. 8. Investment Company - A firm that invests the pooled funds of retail investors for a fee.
There are two types: open-end (mutual funds) and closed-end (investment trusts)
9. Management Company - The firm that organizes, manages, and administers funds.
10. Mutual Fund - An open-ended fund operated by an investment company, which raises
money from shareholders and invests in a group of assets, in accordance with a stated set of
objectives. Benefits include diversification and professional money management. Shares are
issued and redeemed on demand, based on the fund's net asset value, which is determined
at the end of each trading session.
11. Secondary Fund - A fund which purchases a security from another investor rather than the
issuer, subsequent to the original issuance in the primary market.
12. Turnaround Fund - A private equity fund, which invests in troubled companies to cause a
sharp, positive reversal in their performance.
13. Venture Capital (VC) Fund - Funds made available for startup firms and small businesses
with exceptional growth potential. Managerial and technical expertise are often also
provided. Also called risk capital.
14. Venture Capital Limited Partnership - Limited partnership that is formed to invest in small
startup businesses with exceptional growth potential.
Start Up Ecosystem - Investment Entities - Detailed

11. Start Up Ecosystem - Company Terminology
1. Company
2. Related Company
3. Spin Off
4. Startup

12. Start Up Ecosystem - Company Terminology
Related Company - A company which isn't listed in local
territory but has at least one of the following
characteristics: Headquartered in local territory; Has an
R&D center in Local Territory; Has senior local
management or received funding from an local
company.
Spin Off - An independent company created from an
existing part of another company through sale or
distribution of new shares.
Startup - A new business venture in its earliest stages of
development.

13. Start Up Ecosystem - Company Stages and Status
1. Seed
2. Research and Development (R&D)
3. Mezzanine level
4. Initial Revenue
5. Revenue Growth
6. Ceased to Operate
7. Suspended Operations

14. Start Up Ecosystem - Company Stages and Status
1. Seed - A startup company, which is in its early days of product development and fund
raising.
Research and Development (R&D) Discovering new knowledge about products, processes,
and services, and then applying that knowledge to create new and improved products,
processes, and services that fill market needs.
2. Research and Development (R&D) - Discovering new knowledge about products, processes,
and services, and then applying that knowledge to create new and improved products,
processes, and services that fill market needs.
3. Mezzanine level - A term used to describe a company which is somewhere between startup
and IPO. Venture capital committed at this level usually has less risk but less potential
appreciation than at the startup level, and more risk but more potential appreciation than in
an IPO.
4. Initial Revenue - A company whose yearly revenue does not exceed $10 million dollars.

15. Start Up Ecosystem – Company Stages and Status
5. Revenue Growth - A company whose yearly revenues exceed $10 million dollars and has a
double digit yearly growth rate.
6. Ceased to Operate - When a company or project is listed as “Ceased to Operate” on IVC-
Online*, it means that the company or project is no longer operating in its latest reported
offices and the known communication channels with such company or project are not
operating. “Ceased to Operate” does not necessarily mean the company or project is
liquidated or dissolved.
7. Suspended Operations - When a company or project is listed as “Suspended Operations” on
IVC-Online* it means that the company or project has suspended its R&D activity. However,
such company or project can still have an IP (Intellectual Property) that it is interested in
selling or offering integration services through third parties. It is possible that a company or
project under suspension may, in the future, be re-operating and the listing can be reversed
when IVC is so notified.

16. Start Up Ecosystem - Company Terminology
Target Crowd – Business Model
1. Business To Consumer 2. Business To Business
B2C B2B

17. 3 Important Data Slides On Israel
Please Stay Strong!
Start Up Ecosystem - Israel

18. Start Up Ecosystem - Israel
• Israel has more than 5,000 active startup companies
• More than 2,000 new pre-seed join the cycle annually
• Average of ~600 New startups every year
• Israeli high-tech companies raised $2.3 billion in 2013
• Altogether 662 finance deals
• 395 deals attracted 1.7 billion =74 %
• the highest amount in the past 10 years
*IVC-Online Database (www.ivc-online.com)

19. *IVC-Online Database (www.ivc-online.com)
Decline In Internet Deals

20. *IVC-Online Database (www.ivc-online.com)
Investment By Stage

21. “The days when a startup could sell investors on a dream and
norevenuearecomingtoaclose”-Chris Dixon
Decline In Internet Deals

22. “Venture Capital Behind The Scenes” – B to C

23. Business or transactions conducted directly between a
company and consumers who are the end-users of its
products or services.
Real World - Definition of 'Business To Consumer – B To C

24. Real World - Definition of 'Business To Consumer – B To C

25. Traditional B to C Investment Firms
1. No Evaluation Model In B to C Universe = High Risk
2. Inefficient Use of Investment = Waste
3. Time To Market = Changing Market / Needs

26. Traditional B to C Investment Firms
What Is The Solution – NO B TO C ?

27. What You Should Do?
McDonald’s
Supermarket
Startup

28. KIM Investment Mechanism – We Don’t Know

29. KIM Investment Mechanism – We Don’t Know
1. Mass Intelligence
2. Smart Marketing &Capital Investment
3. No Wasted Time

30. What Do We Look For ?
1. Me Too & Market Size
2. Committed & Smart Team
3. Working POC = Working Proof of Concept

31. Krypton Investment Process
Mass Intelligence Stage
500k – 1 Million USD Marketing Investment
100K-1Million Cash Investment
Heart Beat Evaluation
Yes
Predetermined
Equity
Partnership
Additional Investment
Separation
No

32. Take Homes
1. Ice Breaker – “Superman”
2. Know Your Friend - Start Up Ecosystem
3. Dream Days Are Over – Know Your Revenue Model
4. MacDonald's Or Startup?
5. Know Your Enemy and Learn From Him
6. No Wasted Time