1776 discovery fund investor pitch


Published on

1776's Super Accelerator Fund Investor Pitch

Published in: Business, Economy & Finance
  • Be the first to comment

1776 discovery fund investor pitch

  1. 1. Super Accelerator and Discovery Fund Investor Pitch
  2. 2. America faces profound challenges… …to reinvent education, health, energy, government, and politics. …to be leaner. …to be better. …to be more responsive to citizens as consumers.
  3. 3. …in markets that account for over 50% of GDP Consumer Web: $70b Health: $1,067b Education: $869b Energy: $1,200b
  4. 4. Washington is the most powerful city on earth… …with a nexus of connections to every major corporation, NGO, government agency, and country in the world. …with unparalleled domain expertise in the public sector, regulated industries, and global markets. …with unrealized pools of talent and capital.
  5. 5. The 1776 platform… …connects the hottest startups in the world, tackling the biggest challenges, with the unique assets of DC. Donors 1776 Campus 501c3 Campus Sponsors Media and Events 1776 LLC 1776 Fund For Profit Partnership School Revenue from Startups Super Accelerator Fund Investors
  6. 6. The Leaders… Evan Burfield Donna Harris Cofounder, 1776 Chair, Startup DC Founder, Synteractive Founder, netDecide Cofounder, 1776 MD, Startup America Vice Chair, Interpoint Group 4X startup Founder and Executive
  7. 7. The Advisors… Jonathon Perrelli Fortify.vc Brad Feld Foundry Group Scott Case Startup America Kevin Willer 1871 David Cohen TechStars Patrick Riley Paul Singh 500 Startups Global Accelerator Network
  8. 8. The Strategy of the 1776 Super Accelerator and 1776 Discovery Fund To identify and attract the most promising startups disrupting the status quo in highly regulated industries To leverage proprietary networks of advocates and corporate partners to provide them with an unfair competitive advantage To benefit financially by investing in these startups through a structured, data-driven methodology (the Moneyball approach)
  9. 9. The 1776 Super Accelerator will… Be a “graduate” accelerator that focuses on startups that have already demonstrated product-market fit and capital readiness Select “Seed C stage“ companies that already have clear evidence of traction raised seed capital from credible sources but have not yet raised a “Venture A round” Focus on startups engaged in the “consumerization of the public sector” with consumer-style products in complex, highly regulated industries such as education, health, energy, transportation, and government
  10. 10. The Super Accelerator program will… Help startups develop scalable business models compatible with complex industry dynamics Navigate regulatory risks and opportunities Develop corporate partnerships focused on distribution and whole product solutions Activate a federal, state, and local advocacy network to drive revenue growth
  11. 11. The Super Accelerator program will… Be open to 10 to 12 startups per class Be a 90 day program with key elements of team based in DC Provide ongoing virtual alumni engagement with regular alumni events in major cities
  12. 12. Super Accelerator mentors will be… Advocates with deep networks within regulated industries both in DC and at state and local level Experts from key corporate partners within regulated industries, formed into Industry Councils for each key industry Accomplished entrepreneurs with a track record of successful disruption in regulated industries
  13. 13. Super Accelerator deal flow will come from… Direct partnerships with top tier Accelerator such as 500 Startups, TechStars, and members of the Global Accelerator Network Personal networks with the Startup America regional leaders Other 1776 programs such as the 1776 Campus and 1776 Events
  14. 14. Super Accelerator deal selection will leverage… Due diligence from the 1776 advocacy network with direct expertise within regulated industries and at the state and local level Expertise from Industry Councils of corporate partner within regulated industries Panel of venture capital advisors with expertise in regulated industries
  15. 15. The 1776 rules of thumb checklist  Product shows evidence of multiple data-driven iterations  Product solves a problem for a specific target customer within regulated industry  Capital-efficient business – operational @ < $1 million in funding  Primarily internet-based distribution – search, social, mobile, local  Simple revenue models – transactions, subscriptions, or affiliates  Measurable usage – some customers, early revenue  Potential to create barriers to entry through solving regulatory or distribution challenges  Small but cross-functional team – engineer, design/UX, marketing
  16. 16. The 1776 Discovery Fund will… Make initial investments of between $75,000 and $150,000 into Super Accelerator companies plus select non-accelerator companies (typically leading a Seed C round of $400,000 to $650,000) Track performance data on portfolio in a near real time basis to determine winners and losers Leverage pro rata rights to make follow on investments in most promising startups in portfolio
  17. 17. Leverage feedback loop… Build strategic relationships with corporate partners and venture funds as both sponsors and LPs Understand what corporate partners are interested in acquiring and what venture funds are interested in funding Use inside information to increase odds of early acquisitions (regular small wins) and major funding rounds into companies with right attributes to build something great (a few big wins)
  18. 18. The Moneyball approach… Selection benefits from advocacy network, corporate partners, and venture partners 30% of capital in initial investments 30 to 40 investments per year 70% of capital in follow on Filter out failures Follow on in top 20% to 30% Early acquisitions by corporate partners Follow on investment decisions based on analysis of private performance data Major venture investments into companies with potential to be great
  19. 19. 1776 Discovery Fund terms… $25 million fund Seven year life with option for two year extension Two year investment period 2% management fee 20% carry with ratchet for portfolio return above 3x