1. Top 10 Suggestions that
may help you to be
Successful in a New
Business
Salvador Clavé
Barcelona, January 2009
2. Top 10 Suggestions
#10 : Read: “Do What You Love: Time is Too
Short to do Anything Else”
Steve Jobs, CEO Apple
http://articles.mercola.com/sites/articles/archive/2005/07/05/steve-jobs.aspx
http://www.youtube.com/watch?v=D1R-jKKp3NA
3. Top 10 Suggestions
#9 : Never give up and start now …
…meet with as many VC’s as possible
and learn something from every meeting
Out of 100 business plans reviewed, a VC will make 1
investment
Out of 10 investments made by a VC:
2 will fail in the short term
6 will become “walking wounded” or “living dead”
2 will become winners (>35% ROI or 10X)
4. Top 10 Suggestions
#8 : Don’t become a lawyer…
…but be ready to read/understand a lot of
legal terminology (and get closer to a real
lawyer)
5. New Legal Terminology !!!
Term Sheet Conversion rights
“put option” “pre-emptive rights”
“anti-dilution provision” exit provision Preferred Shares
“drag-along rights” Options / ESOP
“piggyback rights” Voting Trust
“buy-out”
“first offer rights”
protective provision
pre-money valuation
Term Sheet
http://www.nvca.org/model_documents/model_docs.html
6. Top 10 Suggestions
#7 : Experts are not always right….
…have the courage to follow your heart
and intuition BUT justify it properly
7. Who will be sworn in as US
40% 39%
president in January 2009?
35%
30%
25%
21%
20%
16%
15% 13%
11%
10%
5%
0%
Hillary Rudy Barack Mitt Other
Clinton Giuliani Obama Romney
Source: December 2008 / Predictions Survey
8. Apr 28th, 2008
OPEC President
predicts a $200 Barrel of Oil
May 6, 2008
Goldman Sachs
predicts oil price to $150 to $200
Dec 12, 2008
Goldman Sachs
predicts oil price to be $30 to $45
9. Top 10 suggestions
#6 : Don’t create too much bureaucracy…
… but implement enough business
processes that will support scale up of the
business and the transition from Angels
money to VC money (“valley of death”)
11. “Due Diligence” Business Plan
Financial Projections
Budget and Variance Reports
Research Documents
Patent Summaries
Due Diligence Products
Market Strategy
Competitors
Technology
Product Development Strategy
Sales Strategy
Revenue
Customers
Financial Controls
IT
Management
Work Force
Legal
12. Top 10 Suggestions
#5 : When talking to a VC, NEVER say:
“It’s my baby…”;”I know it best…”; “My technology is
the best…”
know and believe in your solution; be reasonable; be credible and
bring in others that will challenge it
“We have no competition…”; “…nothing like us…”;
know your market place; your product positioning; your direct or
indirect competitors;
“My company / idea is worth… ”
Let VCs put the initial valuation; look for benchmark companies to
challenge it;
13. Top 10 Suggestions
#4 : You will have to answer these key questions 1000 times.
Have good answers ready:
Market Size / Industry Capacity / Who are your Customers?
Product Positioning / “elevator test”
Why you ? Key Differentiators
Expected Penetration Rate
Expected Sales Cycle
Who is your “technical buyer”? “executive buyer”? “end user”?
Main Competitors
Pricing Strategy
Back-up your answers with as many “experts/market
analyst” data/reports as possible
14. Top 10 Suggestions
#3 : Choose and be part of a strong team…
… you don’t need to be friends but if you
are, be ready to loose them as friends
15. Key Factors in the VC Funding Decision
Factors considered most
important by investment
professionals (NVCA
member survey)
Technology/Products
Business Model
Market Sector
Management Team
http://www.nvca.org/ 0 10 20 30 40
16. Top 10 Suggestions
#2 : “exploit” your Board wisely…
… what !!!??? do I need a board of directors !!??
think about composition, control, compensation,
experience, contacts, industry knowledge,
credibility,…
17. Top 10 Suggestions
#1 : Create a “self-fulfilling” prophecy
environment….
…“YES, WE CAN”
18. Thank You! Questions?
Salvador Clavé
email: sclave@3esi.com
http://www.linkedin.com/profile?viewProfile=&key=4054758&locale=en_US&trk=tab_pro
