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The 2% - From
Entrepreneurship to CEO
@DavidRaskino
Microsoft Ventures, June 2014
* Global Entrepreneurship Monitor, 2013 and EVCA, NVCA, Pitchbook
Europe’s 2% (2013)
Analysis was conducted based on data from Pitchbook, EVCA, CBInsights and Angel.co
• 330 prominent
Ange...
Joining the 2% Club
Venture & M&A
Business Model
Product
First, some basics
• Friends & Family (and Fools): Pre-seed, designed to get you to a basic prototype. Avoid it if you can...
Venture & M&A
Series A
Crunch
“Venture” is now at Seed stage. Not Series-A
• Greater need to perform exceptionally well
• Strong product...
Account for ~30% of all tech venture investment
and 67% of acquisitions.
Corporate VCs
Corporate VCs are changing the game...
Know your Potential Buyer(s)
• Know where you fit
• Companies get bought, not sold.
People buy companies from people they ...
Follow-on financing varies
greatly depending on tech
category*.
* 2013 Seed Investment Report, CBInsights
Metrics Matter M...
Business Model
Building a Business
(e-CommerceExample)
Customer Acquisition Costs (CAC) Ratio,
A Practical Example
(Howtocalculateitandwhyitmatters)
• You are an e-Commerce mobi...
Product
You can’t manage what you don’t
measure.
• Web: Google Analytics
• Product: New Relic, Flurry, Buddy,
Appsee
• Business: M...
Thanks!
The 2% - from entrepreneurship to CEO - David Raskino
The 2% - from entrepreneurship to CEO - David Raskino
The 2% - from entrepreneurship to CEO - David Raskino
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The 2% - from entrepreneurship to CEO - David Raskino

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The 2% - from entrepreneurship to CEO - David Raskino

  1. 1. The 2% - From Entrepreneurship to CEO @DavidRaskino Microsoft Ventures, June 2014
  2. 2. * Global Entrepreneurship Monitor, 2013 and EVCA, NVCA, Pitchbook
  3. 3. Europe’s 2% (2013) Analysis was conducted based on data from Pitchbook, EVCA, CBInsights and Angel.co • 330 prominent Angel/VC backed startups • Median $0.66MM Seed Series A (54%) • 178 raised a series-A. • Median $3.7MM Series B (36%) • 118 raised a series-B. • Median $8MM Series C (19%) • 62 raised a series-C. • Median $14MM Series D (7%) • 23raised a series- D. • Median $26MM 9% acquired (29) 7% acquired (23) 5% acquired (16) 3% acquired (9)29% acquired (95) 18 months to utilize seed 24 months to utilize Series-A 24 months to utilize Series-B 18-24 months to utilize Series-C
  4. 4. Joining the 2% Club Venture & M&A Business Model Product
  5. 5. First, some basics • Friends & Family (and Fools): Pre-seed, designed to get you to a basic prototype. Avoid it if you can. Typically $25 - $100k. Early-stageGrowthExit * 2013 Global Tech Exits Report, CBInsights • Seed: Build fully functional product based on deep customer validation. Focus on building sales pipeline to prove out your business model in a few key cities. Typically $500k - $1.5MM (in the US). Take it from smart investors who do follow-on. Get as far as you can before your round. Find an anchor. • Series-A: Your first “institutional round”. Focus on scaling your business model (e.g. national, cross-sector etc.). Typically $2MM - $8MM. • Series-B, C, D+ & PE: Growth capital designed to help companies expand nationally/internationally and cross-sector. • IPO: Initial Public Offering, in which your company goes public and is listed on a stock exchange. • Acquisition: your company merges or is acquired by another company. ~67% of tech acquisitions last year were <$5M “acquihires” *
  6. 6. Venture & M&A
  7. 7. Series A Crunch “Venture” is now at Seed stage. Not Series-A • Greater need to perform exceptionally well • Strong product and market differentiation • Exceptional execution
  8. 8. Account for ~30% of all tech venture investment and 67% of acquisitions. Corporate VCs Corporate VCs are changing the game, motivated by lost-cost: • Business model exploration • market insight • access to talent. Get one to participate in your round Get a commercial partnership going Demonstrate the knowledge & execution of your team
  9. 9. Know your Potential Buyer(s) • Know where you fit • Companies get bought, not sold. People buy companies from people they know. Get a BD deal or commercial partnership. • It shouldn’t, but PR matters. If you aren’t getting good press coverage, you’re not known. • Use VC/strategic relationships. Corporations prefer trusted referrals vs cold calls. You need to know someone who knows someone. • Build the right relationships. Generally, Corp Dev does the transaction. The Business buys your company. Not always the case – know your potential buyer.
  10. 10. Follow-on financing varies greatly depending on tech category*. * 2013 Seed Investment Report, CBInsights Metrics Matter More Than Ever
  11. 11. Business Model
  12. 12. Building a Business (e-CommerceExample)
  13. 13. Customer Acquisition Costs (CAC) Ratio, A Practical Example (Howtocalculateitandwhyitmatters) • You are an e-Commerce mobile app, selling retail/shopping goods • Its summer time and you have a range of promotions (i.e. marketing expenses) • You brought on an excellent content marketing person • You want to calculate the efficiency (profitability) of your overall Sales & Marketing expenses (i.e. CAC Ratio)
  14. 14. Product
  15. 15. You can’t manage what you don’t measure. • Web: Google Analytics • Product: New Relic, Flurry, Buddy, Appsee • Business: MixPanel, Localytics • Interpret your metrics. Tie them back to your Business Model & Funnel, otherwise its just data. Avoid building your own. Please. Measure Everything
  16. 16. Thanks!

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