Ariel Poler shares insights from his diverse experiences in Silicon Valley fundraising, emphasizing the unique nature of the region and the importance of personal relationships over firm reputations. He notes that most startups are financed through bootstrapping rather than venture capital, though VCs and angels significantly contribute to technology innovation. Key advice includes focusing on moving the business forward, understanding the fundraising landscape, and being cautious about hiring practices.

1. FUNDRAISING IN SILICON VALLEY – PLUS A FEW RANDOM THOUGHTS. ARIEL POLER

2. I've been on three sides of the table... Started three Internet companies - I/PRO (1994): VCs & strategic investors (4 rounds) - Topica (1998): Angels, VCs and private equity investors (3 rounds) - TextMarks (2006): self financed to profitability. Chairman or Active Board Member at 10+ companies - Kana (VC, PE, IPO); LinkExchange (VCs); Freedom Financial (angels); Passporta (angels); Papilia (angels); Odeo (VC); StumbleUpon (angels); LOLapps (angels, VC); SpeedDate (angels, VC); Strava (angels, VC), MixTent (angels). Angel in over 40 start-ups - NexTag, AdMob, Kongregate, SlideShare, Flixster, Rockyou, Xobni, Causes, Aptimus, Outright, Urbano, LatiLists, Blippy, Digital Impact, Thumbtack, Viikii, Instructables, Groupspaces, Evite, WeGame, ccLoop

3. Silicon Valley is Another Planet – Be Very Careful When Trying to Replicate It - Very unique, even within the US and California - We have the process down to a science: - term sheets - compensation arrangements - partnerships - technologies & services - legal, banking, accounting, hr... - You get to eat with the influencers every day!

4. VCs and Angels only represent a tiny fraction of the financings in the world – Including in USA Most companies are bootstraped, funded by friends & family, credit cards, cash flow, etc. etc. But: VCs & Angels do account for a large share of innovative technology start-ups in the US.

5. It is not a Black and White distinction between Angels, VCs, Private Equity There are many shades of Grey... Angels with funds. VCs that focus on seed investments. VCs that participate in seed rounds. VCs with Private Equity like late stage funds What matters most is the individual, not the firm!

6. On "average", It takes 6 Months... But averages are often meaningless "Hot deals" are done in a few weeks, some times a few days Most deals never get done. And somehow the average is 6 months... The best thing you can do to increase the odds of a successful financing is to move your business forward. Be careful about spending tons of time fundraising.

7. International Companies have better chances of fundraising elsewhere Silicon Valley is the only region with too many good deals. Investors elsewhere HAVE TO invest outside their region, but we don't. So the bar is much higher... So non Silicon Valley companies might be better of fundraising in places such as London, New York or Boston.

8. "You are too early for us... ” and other excuses… Most investors do deals when they get excited by them. But they don't like to say "i am not excited", so instead they use an easy excuse, such as: - You are too early - The deal is too small - I want to see more customers/revenues/technology Be careful about trying to solve their excuses, because once you do they are likely to find others. Instead, figure out how to get them excited.

9. A Few Random Thoughts…

10. Speed is overrated! What good is going fast in the wrong direction? The better you understand where you need to go, the faster you can move But, never stand still!

11. Don ’t believe what you Read Most success stories are made with 20/20 revisionist hindsight It often takes time, e.g. StumbleUpon, OpenTable were not overnight successes as some people think… 20/20 Hindsight gives great strategic vision. Realistically, successes are built incrementally. So, don’t obsess over your world domination vision. Just make sure you have a vision for a small success – from which you will be able to build a larger one.

12. You can’t literally follow all the advise that you get There are many ways of building companies You must find the approach that works for you Advise should help you gain insights and to experiment It is the same for competitive athletes…

13. Hire Slow & Fire Fast The moment you start thinking someone might not be working out, he/she most likely isn’t But letting someone go is difficult and painful for everyone, so…, take your time hiring.

14. Take advantage of opportunities - but be careful about where you end up IPRO story: Started with consumer analytics Followed customers to traffic auditing Became World leader Web traffic auditor BUT… That turned out to be a lousy business! Make sure you enjoy the road People, product, learning, fun…

15. Focus on your most important market from the start Be careful about starting with the “local” market. You might get stuck there and never quite make it to the larger markets If you want to be a global player, focus on a large market, such as the US or Brazil, from the start

16. Moving to Silicon Valley? PLUSES: The “center of the universe” Money Experts Partners Customers in some cases A “must do” in some spaces MINUSES: Much harder to hire talent More expensive? MIDDLE GROUND: Come for a while - or come frequently Send some of your team

17. Leveraging Silicon Valley Help us help you Do your homework The right people to talk to The topics you want to discuss Be Specific Add value

18. Investors Back People not Presentations A presentation is like a resume, a door opener, a conversation starter… What really matters is the people and the business, not as much how they present Make sure your presentation doesn’t get in the way, but don’t over-optimize it…

19. Questions? @ariel www.octaven.com