The document provides an overview of finance for startups, covering topics such as company setup, accounting, financial planning, funding options, and valuation. It discusses establishing the proper legal structure for a new company, basic accounting principles, how to develop a financial plan, common sources of startup funding including banks, investors, and crowdfunding, and how company valuation and ownership dilution works. The presentation aims to give entrepreneurs an introduction to important financial considerations for founding and growing a new business.

1. Finance for Startups
Xavier Corman
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 1

2. Finance for Startups
• Introduction
• Company Setup
• Accounting
• Financial Plan
• Funding your startup
• Valuation / Dilution
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 2

3. Who I am ?
Xavier Corman
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 3

4. This presentation is available for free:
http://www.slideshare.net/xaviercorman
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 4

5. Why Finance for Startups ?
If you don't think about the future,
you cannot have one.
John Golsworthy
where you want to go
You need to know
how you are supposed to go
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 5

6. Company Setup
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 6 6

7. Why should I ?
Limit your liabilities !
Professional touch
Fiscal 34%
Succession
...
Formalities & some costs
(bank, notary, KBO/CBE, social secretary)
Double entry accounting
Revisor for in-natura contributions
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 7 7

8. Minimum capital
Legal
BVBA-SPRL (min.1)
CVBA-SCRL (flexible)
18.550 EUR  6.200 EUR
(or 12.400 EUR)
SA-NV (min.2):
61.500 EUR
REAL minimum = Business required !
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 8 8

9. Shareholders  Control (>51%)
Absolute / Relative majority
40% - 60%
40% - 10% - 10% -10% -10% -10% -10%
Voting Rights
Class A & B
Minority (blocking) interest
Investors per phase (dilution)!
Stock options:
fiscal implications, buyer required
vesting conditions : targets, period (4y)
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 9 9

10. Hats/Personalities
Founders – Shareholders Founders:
(Board) 3 years responsibility
Owners
CEO (gérant/zaakvoerder)
General Manager
Directors
CxO
Employees
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 10 10

11. Accounting: notions
• Balance Sheet – Bilan – Balans
• Profit & Loss – Compte de résultat – Winst-en Verliesrekening
• Cash-flow – Trésorerie – Schatkist
• Financial Plan – Plan financier – Financieel Plan
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 11

12. Accounting: Balance Sheet
ACTIVE PASSIVE
Equity (Capital/Kapitaal)
Non Current Assets
(Actifs Immobilisés/
Vast Activa)
LT Debts
Current Assets
(Actifs circulants/
Vlottend Activa) ST Debts
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 12

13. Accounting: Profit & Loss (P&L)
COGS (Cost of Sales)
Personnel Costs
Gross margin
General Expenditures
Revenues (Sales…)
Added Value
Depreciation
EBITDA
Financial cost
Profit
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 13

14. Financial Plan
Content
– Assumptions
– Profit & Loss
– Balance Sheet / Investment
– Cash-Flow -> Cash needed
– Valuation of the project
– Profitability / return of the project
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 14

15. Financial Plan in 10 min
• Don’t waste your time in developing a huge
financial plan before to be sure that your
project is viable !
• In many case, in less than 10 minutes, you can
see if your idea worth something.
• How to make a very quick financial plan ?
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 15

16. Financial Plan in 10 min /questions
What are your revenues ?
What are your costs ?
What are your investments ?
How many persons for your project ?
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 16

17. Financial Plan / Prerequisites &
Assumptions
• Financial plan for 3 to 5 years
• Monthly or Quarterly base
• Excel or Calc is your friend
• Start by listing your main assumptions
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 17

18. Financial Plan / Tips for assumptions
• Office: 25 m²/person
• Price of offices: EUR 100/m²/year + 15 % for
maintenance
• Insurances: 1 % of revenues
• Marketing: define a % of revenues + starting
investment
• Don’t forget lawyers, accountant, social
secretary, office supplies…
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 18

19. Financial Plan / Profit & Loss
Revenues (Sales…)
COGS (Cost of Sales)
General Expenditures
COSTS
Personnel Costs
Financial cost
Depreciation CASH
CASH-FLOW IF NEGATIVE DRAIN
Profit
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 19

20. Financial Plan / Investments
List all your scheduled investments
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 20

21. Required Cash-Flow
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 21

22. Funding, ‘Financing’
And entrepreneurs? They seem to have confused the definition of
entrepreneurship altogether.
Entrepreneurship, they mistakenly believe, equals financing!
This is wrong.
Over 99% of entrepreneurs who seek funding get rejected.
Yet, the entire world is focused on the 1% that is "fundable."
http://www.readwriteweb.com/start/2012/01/the-other-99-of-entrepreneurs.php
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 22 22

23. http://www.ideaowl.com/blog/2011/06/microconf-2011-3-surprises-
and-learnings-from-best-conference-ever/
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 23

24. How to finance your start-up ?
Clients
FFF
Suppliers
BA
Banks
VC
Shareholders
Crowd
Equity
LT Debts
ST Debts
Public
Banks
Shareholders
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 24

25. Valuation
• The value of any business is the present value
of the future income stream
• You sell future virtual profits for present real
money
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 25

26. Valuation
Exit Money
Sweat Money
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 26

27. Valuation - What is dilution ?
100%
15% 20%
90% 25%
80%
12%
70% 15% VC 2
60% 9% VC 1
50%
85% BA
40%
68% Founder(s)
30% 51%
20%
10%
0%
Start 1st Round 2nd Round
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 27

28. Questions & Answers
Free download:
http://www.slideshare.net/xavierCorman
16/03/2013
07/02/2012 Xavier Corman | Martin van Wunnik
Xavier Corman 28