How to raise money for your first startup business

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How to raise money for your first startup business

  1. 1. How to raise money for your first start-up business Peter Cheng | 程 勇 http://cn.linkedin.com/in/petercheng © 2010 C2IVC
  2. 2. Agenda Is right time for Start-ups? How much do you really need for a Startup? Raise money, alternative way Get things done , Strategy to Action 2 © 2010 C2IVC
  3. 3. I have a Dream © 2010 C2IVC
  4. 4. The Business Revolution 1999 2004 2009 What’s Next 5 Year? © 2010 C2IVC
  5. 5. Today is So Yesterday NASDAQ China Stock A The Gartner Hype Cycle © 2010 C2IVC
  6. 6. Is the right time? © 2010 C2IVC
  7. 7. What Type of Business Are You in? © 2010 C2IVC
  8. 8. Content vs Context vs Timing • Right idea in the wrong place (JFox) • Right idea, right place wrong timing (Yes PPG) • Right idea, right place, right timing…but Wrong team (Xiaonei) 天时 地利 人和 © 2010 C2IVC
  9. 9. How much do you need? • Project how much money you need for one year • Add a 30% buffer • Fundraising will take 6-9 months. (current climate 9-12+ months) • Angel (seed) or venture capital (Series A) Beijing RMB 50,000 ~ 100,000 Start-up © 2010 C2IVC
  10. 10. Who is your ideal investor? • Capital needs dictate investor type • ✓ Micro-seed capital. < RMB 100,000 (i.e.TechStars, friends & family, savings, Visa/Mastercard) • ✓ Seed capital. RMB 100,000 - 2 million (angels/angel funds. i.e 雷军) • ✓ Series A round. RMB 2 – 10+ million (i.e. north light vc) • ✓ Smart money is best. At some point you need money in. © 2010 C2IVC
  11. 11. Make your company investment ready • Get Things in Order » Vision -- What we do » Strategy -- How we do it » Action – Get things done • Packaging Your Startup » Create a solid team » Target a segments market » Build an advisory board » Sign strategic partners or » blue chip customers © 2010 C2IVC
  12. 12. Crowding Funding , A alternative way • Raise $ 300,000 from 1~3 investor • Raise $ 30,000 from 10 private investors © 2010 C2IVC
  13. 13. Everyone has different strengths Tell your supporters all the ways they can help • Donate • Spread the word • Host a fundraiser • Offer matching funds • Feature your project on their blog or social network • Provide creative ideas to get donors energized © 2010 C2IVC
  14. 14. Identify Your Network • Donors • Friends • Family • Board Members • Personal network • Coworkers • Staff • Fans • Community organizations © 2010 C2IVC
  15. 15. Get your network to spread the word Crowdfunding Development Director Emails 100 donors asking for $10 each and to tell 100 of their friends. 100x100x$10 = $100,000 Same effort, but better result. © 2010 C2IVC
  16. 16. Strategy to Action • Building strategy is like a trip to the moon...you know your target but it keeps moving and you have to react accordingly Strategy Paraphrased from Regis McKenna Vision Resource Action © 2010 C2IVC
  17. 17. Basic Elements of a Strategy • Organization Chart • Strategy Model • Project & projectportfolio • Projectportfolios’ Performance • Projectiportfolios’ GANT chart - Roadmap • Metrics - Measure of success © 2010 C2IVC
  18. 18. From Strategy to Action © 2010 C2IVC
  19. 19. Agile Strategy © 2010 C2IVC
  20. 20. Reasons for High Tech Company Failed • Lack of Market Focus (a.k.a. Segmentation) • Undifferentiated Products • Failure to Establish the Right Competitive Barriers • Misinterpretation of the Technology Adoption Lifecycle Model © 2010 C2IVC
  21. 21. It’s about collaboration •Shareholder Engagement •Coordination & Collaboration •Social Media Integration—wikis, Google Docs © 2010 C2IVC
  22. 22. Opening Soon…… April 2010 www.c2ivc.com Focus Areas: • Open Source Software and Services • Technology Enable Services • Mobile Computing © 2010 C2IVC
  23. 23. Best of luck! Peter Cheng © 2010 C2IVC

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