on-line ranking & investment platform




Rating foresight association
     «Future Europe»

  Fouded by Edward Musinski




         Futurerating.org – 11.01.2011
CONTENT

 Description of concept

 Overview of the investment environment

 FORESIGHT & RATING METHODOLOGY
 Opportunities




                                          2
Business-model
  Business-partners –                                      Investment
                              VC Investors
      Consulting                                             experts
       agencies



Strategic investors –                                         Independent
 For 2-nd round of          Rating Assotiation
     investment                                                 experts




         Knowledge center                        Business-center –
           Technologic                             Marketing &
             transfer                             Other services

                                 Success factors
                                 • International Co-operation (INCO)
                                 • Mobility
                                                                            3
Trends




         4
Investment statistics and VC sampling
•   Investment has managed to increase, with $18 billion invested in the
    first three quarters of 2010, a 10 percent increase in investment and
    deal quality as last year.
• The fifth annual survey conducted by the NVCA drew responses from
    330 U.S. venture capitalists and 180 startup CEOs, offering a
    comprehensive look at an industry still fighting its way back to health.
• Most notable is the rising interest in technology investing and the
    potential for startup exits. Large majorities of VCs and entrepreneurs
    expect an upswing in technology M&A, and 72% of VCs anticipate
    technology IPOs to increase in volume.
• What also seems clear is that fears of a cleantech bubble have largely
    passed. Forty percent of VCs surveyed expect a decrease in energy
    investing,
 while 38% see an increase.
• Below are the key results from the study:
• * Fifty-one percent of VCs believe venture investing will
increase in 2011. Even more startups CEOs, 58%, concur.
Roughly a quarter of venture investors believe it will fall.




                                                                               5
Experts opinions and survey
 A leading indicator of activity in the venture-backed ecosystem is job creation. There are
 more than 10,000 job openings at venture-backed companies listed on StartUpHire.com.
 Steve Fredrick and Don Rainey are general partners at Grotech Ventures. (disclosure: Steve
 is an advisor to StartUpHire).

 •For those wanting a quick update on the US venture capital industry, here are 4 Top Trends:

 •1. Industry as a Whole: In January of 2010 the US Venture Capital industry’s 10-year
 returns turned negative (2000-2010). Estimates range from -0.92% to -7% for the ten year
 period. In 2009 alone the US Venture Capital Index returned 2.95%, significantly lower than
 Barclay’s government and corporate bond index at 4.52%. In 2009 the Dow Jones Industrial
 Average returned 22.68%, the S&P 500 returned 26.46% and the Nasdaq returned 43.89%,
 making venture capital the lowest performing investment class last year amongst such
 peers.
 •2. Fund-raising by VC Firms: VCs raised $3.6 billion in the first quarter of 2010. This is a
 31% decline in dollar commitments from the first quarter of 2009. The raw number of
 investors (LPs) contributing to VC funds also declined by 44% in the first quarter of 2010.
 Investments in follow-on VC funds far exceeded investments in new funds, a trend that
 continues to grow.
 •3. Areas of VC Investment: The top areas of investment in the first quarter of 2010 were
 biotech (17.45% of all deals), software (14.41%) and industrial/energy (14.26%). The
 lowest areas of investment were networking and equipment (1.45%), retailing/distribution
 (0.87%) and healthcare services (0.38%).
 •4. VC Exits: The total number of VC exits has fallen year-over-year since 2007, however the
 first quarter of 2010 enjoyed a resurgence of 9 IPOs and 111 M&A transactions. M&A
 transactions constitute more than 80% of all exits (versus IPOs), a gap that continues to
 widen. The average VC-backed M&A transaction in Q1 2010 was $180.2 million, a 21%
 increase from the average M&A deal size in 2009.
 •Data: Thomson Reuters
 •PricewaterhouseCoopers/National Venture Capital Association MoneyTree Report,                6
FUTURE RATING – synthesis of 3
elements
                  Experts
                  Distributed knowledge
                  participate in the rating of startups




                   Staff of Futurerating

  Start-ups                         Investors
                                    from the prediction – to analysis
  Share options
                                    from a single start-up- to iterative
                                    together a wide range of experts

                                                                    7
Overview of the investment environment.
• That is 1 million euro is "Technology Award of the 21 st century”. The award is
    given for technical innovation, leading to improved quality of life in
    Europe. But this is purely an academic prize, scientists awarded scientists.
•   In our case, the target audience is different: the creators and investors start-
    ups (business angels). This opinion leaders of the business world, whose
    presence on the selection and award will give the investment attractiveness
    to our site.
•   The initiators of innovative businesses have a need to attract interest in their
    start-ups. On the other hand, investors who want to not lose the right
    choice. So far in Europe and Asia, these two intersecting target audiences do
    not have a common platform for evaluating the investment attractiveness of
    startups.
•   At present in Europe and Asia, there is no single investment field, which
    makes the selection of projects existent agony for investors. Although both
    parties (investors and founder of the business) there is a vital need to meet
    and perform pre-investment work, adapting some suggestions to the needs of
    others. Therefore, our forum has absolutely every chance to attract their
    attention. Here's why.
•   Existing forums for the investment data do not fulfill their mission because of
    their narrowness: it is a national contest without prizes (like a fresh Russian
    Russian Startup Challenge YEES-2010), or narrow technological (such as Dev
    Generation 2010, whose winner will receive from Softline Venture Partners
    investment to implement its project in the amount of $ 100,000, or sponsored
    by Cisco - I-Prize, «Siemens», Microsoft and «Google» contests around the
    same prize money).
                                                                                       8
The dynamics of the process of working with
start-ups
    Assessment of the
prospects of development    The formation of alliances of
of existing and emerging         startups promising
                           technologies with the highest
     markets due to         potential for innovation and
       technological           meeting the needs of
      breakthroughs              strategic investors



                  FORESIGHT
    Evaluation  of
medium-and long-term       Development of strategic
 potential of startups        plans and marketing
  and the economic          technologies to improve
      prospects            competitiveness and sale
                             of startups at a higher
                                      price

                                                            9
Open Source Foresight association vs traditional rating agencies



• Traditional rating agencies product –
  valuation and consulting
• Our product:
 increasing of the value of a startup, in
  order to obtain profit for him not by
  the cost method evaluation – but for
  forecasting profitability. During this
  startup founders are willing to pay
  commissions and give option.
                                                                   10
Know-how
• Investment-rating platform «Future Europe» will test the
    registered start-ups for potential success, through the know-how
    of E. Mushinski method.
•   It provide possibility to select the best startups in the early
    stages, and to invest in stock option scheme - a guarantee of
    successful investing.
•   The method of promotion - “grass roots” (another know-how of E.
    Mushinski) lies in the fact that the staff will be specially involved
    in the interaction of start-ups and experts, with two lures
    (motivation): cash (20 awards) and foreseen consulting in return
    of options.
•   This method guarantees not only the participation of start-ups in
    our project, but also that the start-ups and experts will make a
    huge marketing impact - without investment from our part.


                                                                    11
Raise of start-up value
                                                        economic impact
                                                      from falling into the
                                                      trends of the future
The need for comprehensive




                                        Prospective
          studies




                                        technology
                                        and market
                                          choise



                          Фундамен-
                            тальные
                         исследования



                                                                              t
                                                                                  12
Foresight technology
                                                                Our synergetic methods
               Traditional methods




                                                                                      relevancy



                                           expertise




creativity                   interaction
  creativity
                                                       confidence in the public data

         D.Loveridge, B.den Meulen (1996)                  R.Popper, I.Miles (2005)

                                                                                      13
Sinergy from rating agency prognosis

                          Priority areas for
                                  investors




            Critical technologies
он-                                                        Impact on the
                                                             economy and
                                                ...          society
                                                           The level of the
                                                             research


   The major scientific
     and technological                Custom
     results - research                  ized
                                       Invest   Importance. .
                                                         .         Period of
  topics and prognosis                  ment
                                        Ideas                       implemen
                                                                    tation
                                                                              14
Goals
Business model provides the promotion of start-up (for free - all
on a common basis, and with those who will order a special
promotion - we'll be at Euro 4000, and 2% commission in case of
investment attracting).

To hold an investment competition with the biggest prize money
- $ 1 million.

Motivate the fund as start-ups, and experts: the prize goes
startup instead of shares in startups that get the best experts

Serve with the help of partners over 200 startups in 1000
registered on the site, and to compensate for prize money of 1
million dollars in revenue from services - the end of 2011




                                                                  15
Examples
  DaimlerChrysler

How will societies in the triad change in      Trend research for
           the next 10 years?
                                              Mercedes Car Group

  What does this mean to our - future -                        Customer
             customers?                                         Trends
                                              Mercedes Car Group
                                              - Development
                                                                           Mobility
 What are the implications for product        - Marketing
                                              - Design                     Trends
    development and marketing?
                                            Market Environment    Technology
                                                                    Trends
                                                Business Environment
How must specific products look like to
    fit into these future societies?




              Source: Frank Ruff, 2006
                                                                                16
Contact

futureeurope @ gmail.com

Fera

  • 1.
    on-line ranking &investment platform Rating foresight association «Future Europe» Fouded by Edward Musinski Futurerating.org – 11.01.2011
  • 2.
    CONTENT Description ofconcept Overview of the investment environment FORESIGHT & RATING METHODOLOGY Opportunities 2
  • 3.
    Business-model Business-partners– Investment VC Investors Consulting experts agencies Strategic investors – Independent For 2-nd round of Rating Assotiation investment experts Knowledge center Business-center – Technologic Marketing & transfer Other services Success factors • International Co-operation (INCO) • Mobility 3
  • 4.
  • 5.
    Investment statistics andVC sampling • Investment has managed to increase, with $18 billion invested in the first three quarters of 2010, a 10 percent increase in investment and deal quality as last year. • The fifth annual survey conducted by the NVCA drew responses from 330 U.S. venture capitalists and 180 startup CEOs, offering a comprehensive look at an industry still fighting its way back to health. • Most notable is the rising interest in technology investing and the potential for startup exits. Large majorities of VCs and entrepreneurs expect an upswing in technology M&A, and 72% of VCs anticipate technology IPOs to increase in volume. • What also seems clear is that fears of a cleantech bubble have largely passed. Forty percent of VCs surveyed expect a decrease in energy investing, while 38% see an increase. • Below are the key results from the study: • * Fifty-one percent of VCs believe venture investing will increase in 2011. Even more startups CEOs, 58%, concur. Roughly a quarter of venture investors believe it will fall. 5
  • 6.
    Experts opinions andsurvey A leading indicator of activity in the venture-backed ecosystem is job creation. There are more than 10,000 job openings at venture-backed companies listed on StartUpHire.com. Steve Fredrick and Don Rainey are general partners at Grotech Ventures. (disclosure: Steve is an advisor to StartUpHire). •For those wanting a quick update on the US venture capital industry, here are 4 Top Trends: •1. Industry as a Whole: In January of 2010 the US Venture Capital industry’s 10-year returns turned negative (2000-2010). Estimates range from -0.92% to -7% for the ten year period. In 2009 alone the US Venture Capital Index returned 2.95%, significantly lower than Barclay’s government and corporate bond index at 4.52%. In 2009 the Dow Jones Industrial Average returned 22.68%, the S&P 500 returned 26.46% and the Nasdaq returned 43.89%, making venture capital the lowest performing investment class last year amongst such peers. •2. Fund-raising by VC Firms: VCs raised $3.6 billion in the first quarter of 2010. This is a 31% decline in dollar commitments from the first quarter of 2009. The raw number of investors (LPs) contributing to VC funds also declined by 44% in the first quarter of 2010. Investments in follow-on VC funds far exceeded investments in new funds, a trend that continues to grow. •3. Areas of VC Investment: The top areas of investment in the first quarter of 2010 were biotech (17.45% of all deals), software (14.41%) and industrial/energy (14.26%). The lowest areas of investment were networking and equipment (1.45%), retailing/distribution (0.87%) and healthcare services (0.38%). •4. VC Exits: The total number of VC exits has fallen year-over-year since 2007, however the first quarter of 2010 enjoyed a resurgence of 9 IPOs and 111 M&A transactions. M&A transactions constitute more than 80% of all exits (versus IPOs), a gap that continues to widen. The average VC-backed M&A transaction in Q1 2010 was $180.2 million, a 21% increase from the average M&A deal size in 2009. •Data: Thomson Reuters •PricewaterhouseCoopers/National Venture Capital Association MoneyTree Report, 6
  • 7.
    FUTURE RATING –synthesis of 3 elements Experts Distributed knowledge participate in the rating of startups Staff of Futurerating Start-ups Investors from the prediction – to analysis Share options from a single start-up- to iterative together a wide range of experts 7
  • 8.
    Overview of theinvestment environment. • That is 1 million euro is "Technology Award of the 21 st century”. The award is given for technical innovation, leading to improved quality of life in Europe. But this is purely an academic prize, scientists awarded scientists. • In our case, the target audience is different: the creators and investors start- ups (business angels). This opinion leaders of the business world, whose presence on the selection and award will give the investment attractiveness to our site. • The initiators of innovative businesses have a need to attract interest in their start-ups. On the other hand, investors who want to not lose the right choice. So far in Europe and Asia, these two intersecting target audiences do not have a common platform for evaluating the investment attractiveness of startups. • At present in Europe and Asia, there is no single investment field, which makes the selection of projects existent agony for investors. Although both parties (investors and founder of the business) there is a vital need to meet and perform pre-investment work, adapting some suggestions to the needs of others. Therefore, our forum has absolutely every chance to attract their attention. Here's why. • Existing forums for the investment data do not fulfill their mission because of their narrowness: it is a national contest without prizes (like a fresh Russian Russian Startup Challenge YEES-2010), or narrow technological (such as Dev Generation 2010, whose winner will receive from Softline Venture Partners investment to implement its project in the amount of $ 100,000, or sponsored by Cisco - I-Prize, «Siemens», Microsoft and «Google» contests around the same prize money). 8
  • 9.
    The dynamics ofthe process of working with start-ups Assessment of the prospects of development The formation of alliances of of existing and emerging startups promising technologies with the highest markets due to potential for innovation and technological meeting the needs of breakthroughs strategic investors FORESIGHT Evaluation of medium-and long-term Development of strategic potential of startups plans and marketing and the economic technologies to improve prospects competitiveness and sale of startups at a higher price 9
  • 10.
    Open Source Foresightassociation vs traditional rating agencies • Traditional rating agencies product – valuation and consulting • Our product: increasing of the value of a startup, in order to obtain profit for him not by the cost method evaluation – but for forecasting profitability. During this startup founders are willing to pay commissions and give option. 10
  • 11.
    Know-how • Investment-rating platform«Future Europe» will test the registered start-ups for potential success, through the know-how of E. Mushinski method. • It provide possibility to select the best startups in the early stages, and to invest in stock option scheme - a guarantee of successful investing. • The method of promotion - “grass roots” (another know-how of E. Mushinski) lies in the fact that the staff will be specially involved in the interaction of start-ups and experts, with two lures (motivation): cash (20 awards) and foreseen consulting in return of options. • This method guarantees not only the participation of start-ups in our project, but also that the start-ups and experts will make a huge marketing impact - without investment from our part. 11
  • 12.
    Raise of start-upvalue economic impact from falling into the trends of the future The need for comprehensive Prospective studies technology and market choise Фундамен- тальные исследования t 12
  • 13.
    Foresight technology Our synergetic methods Traditional methods relevancy expertise creativity interaction creativity confidence in the public data D.Loveridge, B.den Meulen (1996) R.Popper, I.Miles (2005) 13
  • 14.
    Sinergy from ratingagency prognosis Priority areas for investors Critical technologies он- Impact on the economy and ... society The level of the research The major scientific and technological Custom results - research ized Invest Importance. . . Period of topics and prognosis ment Ideas implemen tation 14
  • 15.
    Goals Business model providesthe promotion of start-up (for free - all on a common basis, and with those who will order a special promotion - we'll be at Euro 4000, and 2% commission in case of investment attracting). To hold an investment competition with the biggest prize money - $ 1 million. Motivate the fund as start-ups, and experts: the prize goes startup instead of shares in startups that get the best experts Serve with the help of partners over 200 startups in 1000 registered on the site, and to compensate for prize money of 1 million dollars in revenue from services - the end of 2011 15
  • 16.
    Examples DaimlerChrysler Howwill societies in the triad change in Trend research for the next 10 years? Mercedes Car Group What does this mean to our - future - Customer customers? Trends Mercedes Car Group - Development Mobility What are the implications for product - Marketing - Design Trends development and marketing? Market Environment Technology Trends Business Environment How must specific products look like to fit into these future societies? Source: Frank Ruff, 2006 16
  • 17.