Intro to Austin Fundraising

Joshua Baer
Joshua BaerAustinpreneur at Capital Factory
Intro to Austin
FUNDRAISING
by @joshuaBaer
Joshua Baer
Founder & Executive Director
Disclaimer
Disclaimer
• I’m not a lawyer
Disclaimer
• I’m not a lawyer
• I’m not a financial advisor
Disclaimer
• I’m not a lawyer
• I’m not a financial advisor
• This isn’t investment advice
people move
here every day150
top of every list
What’s different
about Fundraising in
Austin?
Bootstrap
first
revenue
focused
EXPERIENCED

Teams
How to meet investors
1. Leverage your personal network
2. Go where the investors are - bars, coffee shops, events, Capital Factory
3. Follow them on Twitter
4. Create an AngelList profile (and email it to me)
5. Post to Austin Angel Investors Facebook group
6. Office Hours with CTAN
7. Epic Office Hours at Capital Factory
8. Apply for an Accelerator
9. Participate in pitch events and competitions
Twitter
Startup Lawyers
• KHGR Evan Kastner
• Jones-Spross Brian Spross
• Wilson Sonsini (WSGR) Brian Beard & Paul Tobias
• Andrews-Kurth Matt Lyons
• DLA Piper Paul Hurdlow
• Sprinkle Law Steve Sprinkle (IP)
• Jose Ancer
venture capital
• Silverton Partners @Jon_Bassett, Morgan Flager
• Live Oak Venture Partners @VShamapant (Venu)
• Mercury Fund @TexasVC (Aziz Gilani) @NedHill
• S3 Ventures (enterprise + health) @RajivBala
• Sante Ventures (biotech) Kevin Lalande
• Offset Ventures Chris Pacitti (Austin Ventures)
venture capital
• 500 Startups @DaveMcClure
• Disruption @PaulSingh
• ff Ventures @John_Frankel
• First Round @JoshK (Kopelman)
• FLOODGATE @M2Jr (Mike Maples, Jr.)
• Mohr Davidow @BDStolle (Bryan Stolle)
• Sutter Hill Ventures @SamPullara
Angel investors
• Capital Factory Fund @JoshuaBaer @MelliePrice @AndrewBusey
• ATXSeed Chris Shonk
• Individual Angels @RossInAustin (Ross Buhrdorf) @BazaarBrett
(Brett Hurt) @maharg (Dan Graham) @seats (Jason Seats)
@AmericanCEO (Joel Trammell) @DeepEddyCEO (Clayton Christopher),
Rony Kahan, Joe Liemandt, Tom Meredith
• One of the most active angel groups in the country
• Not just tech
• Quarterly application cycle
• Monthly office hours
• Rick Timmins is the Chairman (and CF Mentor)
• Claire England is the new Executive Director
Intro to Austin Fundraising
Intro to Austin Fundraising
Find investors, introductions & advice at
Epic office hours
office Hours
• Think of this as speed dating
• Don’t expect them to commit on the first date
• Research their background beforehand
• Professional on LinkedIn
• Investments on AngelList
• Personality on Twitter and Facebook
• Ask for a followup meeting to show progress
Accelerators
• Austin Technology Incubator (UT affiliated) @ATI_UT
• Bunker (veterans) @TheBunkerAustin
• Capital Factory (tech) @CapitalFactory @JoshuaBaer
• International Accelerator @IntlAccelerator
• Longhorn Startup Lab (UT Austin students) @LonghornStartup
• SKU (consumer packaged goods) @SKUatx (formerly Incubation Station)
• SXSW Accelerator
• Techstars (tech) @Techstars @Seats
• Medical Innovation Labs (medical devices)
• Unltd USA (social good) @UnLtdUSA
Intro to Austin Accelerators 2nd Tuesday of each month at 4pm
Pitch Events
• Texas Venture Labs Investment
Competition (February)
• SXSW Accelerator (March)
• Capital Factory Demo Day at
SXSW (March)
• Techstars Demo Day (June
2015?)
• Global Venture Labs Investment
Competition (May)
• Capital Factory Demo Day at
Startup Week (October)
• Innotech Beta Summit (October)
• SKU Demo Day
• ATI Clean Tech & Wireless
Forums
• CTAN Presentation Day (5x)
• House of Genius
Blogs
• Paul Graham - How to Raise Money

paulgraham.com/fr.html
• VentureHacks

venturehacks.com/archives
• Wealthfront - VC Economics

blog.wealthfront.com/venture-capital-economics/
• Brett Hurt - Lucky7

lucky7.io
• Gordon Daugherty - Shockwave

shockwaveinnovations.com
• Kip McClanahan - ReOverthinking

reoverthinking.com
• José Ancer - Silicon Hills Law

siliconhillslawyer.com
• Joshua Baer - Austinpreneur

austinpreneur.com
Intro to Austin Fundraising
capital factory
Austin’s Center of Gravity for Entrepreneurs
Last year 32,000 entrepreneurs, programmers
and designers gathered day and night for
meetups, classes and coworking.
Entrepreneurs come to Capital Factory to
Hone skills meetups and hackathons
Find a co-founder
Build a Minimum Viable Product
Meet angel investors and VCs
Find lighthouse customers
Keep costs low
Grow your team
Intro to Austin Fundraising
Intro to Austin Fundraising
46,000 Square Feet full of
Entrepreneurs
programmers and 

entrepreneurs
700Meetups and 

Hackathons
32,000
classroom
teaching skills startups need
Some of the meetups
THe Blueprint
• Community Center
• Coworking pace
• Mentoring
• Fund
VIDEO STREAMING
Follow @Austintechlive
coworking
starts at $200/month
As your company starts to grow reserve
Dedicated Desks
Private offices
Sound proof and secure
Private offices
teams from 2-10 people
phones and tablets available in the
Device Lab
Google glass available in the
Device Lab
DEVICE Lab
3D Printers and more
DEVICE Lab
3D Printers and more
Find investors, introductions & advice at
office hours
Peer Roundtables
Learn from other entrepreneurs
SXSW and startup week
demo dayS
sxswStartup Village
Happy hours
bringing people together
DENSITY DRAWS IN EVERYONE THAT 

STARTUPS WANT TO MEET
VIP Guests
• Bram Cohen, founder of BitTorrent
• Michael Dell, founder of Dell
• Richard Garriott, founder of Ultima Online
• Bob Metcalfe, inventor of Ethernet
• Alexis Ohanian, founder of Reddit
• Peter Thiel, founder of Paypal
• Slash, Guns & Roses
• Stephen Wolfram, founder of Mathematica
Accelerator
• Introductions to angel investors, mentors, customers,
strategic partners, employees
• First priority on offices and desks at Capital Factory
• Access to $50,000+ in matching funds 

from Capital Factory, Silverton, FLOODGATE and our
AngelList Syndicate
Cratejoy Syndicate
Revolutionizing the $24 Billion
self storage industry
180 employees - $26 million funding insight Partners
wordpress hosting
Platform for business
150 employees - $18 million funding Northbridge
$6 Million Funding CHarles River Ventures, A16Z
Lots more…
• Aceable
• Goodybag
• Chiron Health
• Zing
• Nuve
• Pristine.io
• Smart Picture Tech
• Lynx Laboratories
• LanternCRM
• Impossible Ventures
• eRelevance Corp
• Pingboard
• Togga
• Curb
• Kenguru
• Aunt Bertha
• Weeva
• RealMassive
• ManagerComplete
• ihiji
• TripChamp
Apply online
• Coworking 

http://capitalfactory.com/join
• Accelerator 

http://angel.co/capitalfactory/apply
• Back the Syndicate 

http://angel.co/capitalfactory/syndicate
equity or
Convertible note?
• Most companies begin with a convertible note and then do
a priced round (then repeat)
• Convertible notes are entrepreneur-friendly
• Only do a priced round with an experienced investor to
lead and set the price
• SAFE docs
Valuation
• Average is $3m
• On a note, think of the cap as the valuation
• Higher because of traction or track record - up to $8m
• Higher because it is capital intensive
• If you have to justify it, then it’s too high
• Bigger is not always better
time
• Usually takes 6-12 months
• Really fast is 2-3 months
• If only 2-3 investors can happen in 1 month
• Sometimes drags out over 18 months
• Entrepreneurs usually think it’s going to happen faster
Get used to hearing
NO
Say you’re going to do
something. then do it.
if you found
this helpful
Please help
someone else

http://atxstartupscene.com
ask me anything
• Angel Investors
• Venture Capital
• Incubators/Accelerators
• Banks
• Lawyers
• Dev Shops
• Associations
• Hack-a-thons
• Finding a Co-Founder
• Blogs
• Hardware
• Women in Tech
• Capital Factory
• Where do investors
hang out?
Entrepreneur training
• ATI SEAL
• Rice Alliance Entrepreneur’s Workshop
• Tech Ranch VentureForth
• General Assembly
• IronYard
• MakerSquare
Banks
• Chase Jonathan Lee, chase.com
• Silicon Valley Bank Jonathan Miller
• Square 1 Bank
• Comerica
Intro to Austin Fundraising
paperwork
• Company Formation
• Bank Account
• Vesting
• Docusign
Up and coming
• DrillingInfo
• Edgecase
• Eagle Eye Networks
• Impossible Ventures
• Main Street Hub
• Outbound Engine
• PostUp
• Spredfast
• Sparefoot.com
• Spiceworks
• Umbel
• uShip
• WP Engine
Recent Success
• Black Locus > Home Depot
• Dachis Group > Spriklr
• Food on the Table > Food Network
• Gazzang > Cloudera
• Mass Relevance > Spredfast
• MapMyFitness > Under Armor
• Ridescout > Car2Go
• Spanning > EMC
First Time
Experienced teams
Syndicates
angels vs. VC’s
Crowdfunding
• Kickstarter
• Indiegogo
• Able
• Onevest
• Microventures
Lines not dots
FACEBOOK
• Austin Startups

http://facebook.com/groups/austinstartups
• Capital Factory Members 

http://facebook.com/groups/cfcoworking
• Austin Angel Investors 

http://facebook.com/groups/atxangelinvestors
COST
• At least $5,000 in legal fees, as much as $100,000
• Consumes a lot of time. Meetings after meetings.
Smart Money
• Brings some benefit other than the cash
• Introductions to customers
• Relevant industry experience
• Help with recruiting talent
Bad Money
• Comes from illegal source
• Pain in the ass
• Unresponsive
if you found
this helpful
Please help
someone else

http://atxstartupscene.com
1 of 81

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Intro to Austin Fundraising

  • 2. Joshua Baer Founder & Executive Director
  • 5. Disclaimer • I’m not a lawyer • I’m not a financial advisor
  • 6. Disclaimer • I’m not a lawyer • I’m not a financial advisor • This isn’t investment advice
  • 13. How to meet investors 1. Leverage your personal network 2. Go where the investors are - bars, coffee shops, events, Capital Factory 3. Follow them on Twitter 4. Create an AngelList profile (and email it to me) 5. Post to Austin Angel Investors Facebook group 6. Office Hours with CTAN 7. Epic Office Hours at Capital Factory 8. Apply for an Accelerator 9. Participate in pitch events and competitions
  • 15. Startup Lawyers • KHGR Evan Kastner • Jones-Spross Brian Spross • Wilson Sonsini (WSGR) Brian Beard & Paul Tobias • Andrews-Kurth Matt Lyons • DLA Piper Paul Hurdlow • Sprinkle Law Steve Sprinkle (IP) • Jose Ancer
  • 16. venture capital • Silverton Partners @Jon_Bassett, Morgan Flager • Live Oak Venture Partners @VShamapant (Venu) • Mercury Fund @TexasVC (Aziz Gilani) @NedHill • S3 Ventures (enterprise + health) @RajivBala • Sante Ventures (biotech) Kevin Lalande • Offset Ventures Chris Pacitti (Austin Ventures)
  • 17. venture capital • 500 Startups @DaveMcClure • Disruption @PaulSingh • ff Ventures @John_Frankel • First Round @JoshK (Kopelman) • FLOODGATE @M2Jr (Mike Maples, Jr.) • Mohr Davidow @BDStolle (Bryan Stolle) • Sutter Hill Ventures @SamPullara
  • 18. Angel investors • Capital Factory Fund @JoshuaBaer @MelliePrice @AndrewBusey • ATXSeed Chris Shonk • Individual Angels @RossInAustin (Ross Buhrdorf) @BazaarBrett (Brett Hurt) @maharg (Dan Graham) @seats (Jason Seats) @AmericanCEO (Joel Trammell) @DeepEddyCEO (Clayton Christopher), Rony Kahan, Joe Liemandt, Tom Meredith
  • 19. • One of the most active angel groups in the country • Not just tech • Quarterly application cycle • Monthly office hours • Rick Timmins is the Chairman (and CF Mentor) • Claire England is the new Executive Director
  • 22. Find investors, introductions & advice at Epic office hours
  • 23. office Hours • Think of this as speed dating • Don’t expect them to commit on the first date • Research their background beforehand • Professional on LinkedIn • Investments on AngelList • Personality on Twitter and Facebook • Ask for a followup meeting to show progress
  • 24. Accelerators • Austin Technology Incubator (UT affiliated) @ATI_UT • Bunker (veterans) @TheBunkerAustin • Capital Factory (tech) @CapitalFactory @JoshuaBaer • International Accelerator @IntlAccelerator • Longhorn Startup Lab (UT Austin students) @LonghornStartup • SKU (consumer packaged goods) @SKUatx (formerly Incubation Station) • SXSW Accelerator • Techstars (tech) @Techstars @Seats • Medical Innovation Labs (medical devices) • Unltd USA (social good) @UnLtdUSA Intro to Austin Accelerators 2nd Tuesday of each month at 4pm
  • 25. Pitch Events • Texas Venture Labs Investment Competition (February) • SXSW Accelerator (March) • Capital Factory Demo Day at SXSW (March) • Techstars Demo Day (June 2015?) • Global Venture Labs Investment Competition (May) • Capital Factory Demo Day at Startup Week (October) • Innotech Beta Summit (October) • SKU Demo Day • ATI Clean Tech & Wireless Forums • CTAN Presentation Day (5x) • House of Genius
  • 26. Blogs • Paul Graham - How to Raise Money
 paulgraham.com/fr.html • VentureHacks
 venturehacks.com/archives • Wealthfront - VC Economics
 blog.wealthfront.com/venture-capital-economics/ • Brett Hurt - Lucky7
 lucky7.io • Gordon Daugherty - Shockwave
 shockwaveinnovations.com • Kip McClanahan - ReOverthinking
 reoverthinking.com • José Ancer - Silicon Hills Law
 siliconhillslawyer.com • Joshua Baer - Austinpreneur
 austinpreneur.com
  • 28. capital factory Austin’s Center of Gravity for Entrepreneurs Last year 32,000 entrepreneurs, programmers and designers gathered day and night for meetups, classes and coworking. Entrepreneurs come to Capital Factory to Hone skills meetups and hackathons Find a co-founder Build a Minimum Viable Product Meet angel investors and VCs Find lighthouse customers Keep costs low Grow your team
  • 31. 46,000 Square Feet full of Entrepreneurs
  • 32. programmers and 
 entrepreneurs 700Meetups and 
 Hackathons 32,000
  • 34. Some of the meetups
  • 35. THe Blueprint • Community Center • Coworking pace • Mentoring • Fund VIDEO STREAMING Follow @Austintechlive
  • 37. As your company starts to grow reserve Dedicated Desks
  • 40. phones and tablets available in the Device Lab
  • 41. Google glass available in the Device Lab
  • 44. Find investors, introductions & advice at office hours
  • 45. Peer Roundtables Learn from other entrepreneurs
  • 46. SXSW and startup week demo dayS
  • 49. DENSITY DRAWS IN EVERYONE THAT 
 STARTUPS WANT TO MEET
  • 50. VIP Guests • Bram Cohen, founder of BitTorrent • Michael Dell, founder of Dell • Richard Garriott, founder of Ultima Online • Bob Metcalfe, inventor of Ethernet • Alexis Ohanian, founder of Reddit • Peter Thiel, founder of Paypal • Slash, Guns & Roses • Stephen Wolfram, founder of Mathematica
  • 51. Accelerator • Introductions to angel investors, mentors, customers, strategic partners, employees • First priority on offices and desks at Capital Factory • Access to $50,000+ in matching funds 
 from Capital Factory, Silverton, FLOODGATE and our AngelList Syndicate
  • 53. Revolutionizing the $24 Billion self storage industry 180 employees - $26 million funding insight Partners
  • 54. wordpress hosting Platform for business 150 employees - $18 million funding Northbridge
  • 55. $6 Million Funding CHarles River Ventures, A16Z
  • 56. Lots more… • Aceable • Goodybag • Chiron Health • Zing • Nuve • Pristine.io • Smart Picture Tech • Lynx Laboratories • LanternCRM • Impossible Ventures • eRelevance Corp • Pingboard • Togga • Curb • Kenguru • Aunt Bertha • Weeva • RealMassive • ManagerComplete • ihiji • TripChamp
  • 57. Apply online • Coworking 
 http://capitalfactory.com/join • Accelerator 
 http://angel.co/capitalfactory/apply • Back the Syndicate 
 http://angel.co/capitalfactory/syndicate
  • 58. equity or Convertible note? • Most companies begin with a convertible note and then do a priced round (then repeat) • Convertible notes are entrepreneur-friendly • Only do a priced round with an experienced investor to lead and set the price • SAFE docs
  • 59. Valuation • Average is $3m • On a note, think of the cap as the valuation • Higher because of traction or track record - up to $8m • Higher because it is capital intensive • If you have to justify it, then it’s too high • Bigger is not always better
  • 60. time • Usually takes 6-12 months • Really fast is 2-3 months • If only 2-3 investors can happen in 1 month • Sometimes drags out over 18 months • Entrepreneurs usually think it’s going to happen faster
  • 61. Get used to hearing NO
  • 62. Say you’re going to do something. then do it.
  • 63. if you found this helpful Please help someone else
 http://atxstartupscene.com
  • 64. ask me anything • Angel Investors • Venture Capital • Incubators/Accelerators • Banks • Lawyers • Dev Shops • Associations • Hack-a-thons • Finding a Co-Founder • Blogs • Hardware • Women in Tech • Capital Factory • Where do investors hang out?
  • 65. Entrepreneur training • ATI SEAL • Rice Alliance Entrepreneur’s Workshop • Tech Ranch VentureForth • General Assembly • IronYard • MakerSquare
  • 66. Banks • Chase Jonathan Lee, chase.com • Silicon Valley Bank Jonathan Miller • Square 1 Bank • Comerica
  • 68. paperwork • Company Formation • Bank Account • Vesting • Docusign
  • 69. Up and coming • DrillingInfo • Edgecase • Eagle Eye Networks • Impossible Ventures • Main Street Hub • Outbound Engine • PostUp • Spredfast • Sparefoot.com • Spiceworks • Umbel • uShip • WP Engine
  • 70. Recent Success • Black Locus > Home Depot • Dachis Group > Spriklr • Food on the Table > Food Network • Gazzang > Cloudera • Mass Relevance > Spredfast • MapMyFitness > Under Armor • Ridescout > Car2Go • Spanning > EMC
  • 75. Crowdfunding • Kickstarter • Indiegogo • Able • Onevest • Microventures
  • 77. FACEBOOK • Austin Startups
 http://facebook.com/groups/austinstartups • Capital Factory Members 
 http://facebook.com/groups/cfcoworking • Austin Angel Investors 
 http://facebook.com/groups/atxangelinvestors
  • 78. COST • At least $5,000 in legal fees, as much as $100,000 • Consumes a lot of time. Meetings after meetings.
  • 79. Smart Money • Brings some benefit other than the cash • Introductions to customers • Relevant industry experience • Help with recruiting talent
  • 80. Bad Money • Comes from illegal source • Pain in the ass • Unresponsive
  • 81. if you found this helpful Please help someone else
 http://atxstartupscene.com