Financing Growth for Devs 2015
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This is a deck to present to the ViDIA meetup, which is for Vancouver iOS developers. This is actually a collection of a few presentations on the topic of financing growth for software companies. I'll focus the presentation on what the audience wants. Subtopics include: - presentations that don't confuse or distract the audience - presentations for investors - how to define a value proposition - valuations based on cap table and exit values
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Financing Growth for Devs 2015
- 1. Financing Growth for Developers david@davidshore.com David Shore 7pm @davidshore DavidGShore Please turn off cell phones
- 2. Who Is This Guy? Start-ups in the 80’s and 90’s 2000 - 2012 2004 - 2011 InvestorEntrepreneur Advisor 2001 - 2013 -
- 3. Perspectives Founder Board Investor Exit Transactions . M&A
- 9. Textual Presentations - PERFECTING YOUR PITCH -
- 10. Graphic Presentations - PERFECTING YOUR PITCH -
- 14. Pricing : A Science and an Art TYPE OF INVESTOR Issue Aftermarket INSTITUTION UNDERWRITE BUY RETAIL BUY HOLD STAGS BUY SELL - PERFECTING YOUR PITCH - The Secrets of Superb Public Speaking – John Miers 2009
- 15. What was the title of the previous slide? - PERFECTING YOUR PITCH - Keep the answer to yourself for a sec…
- 16. Pricing : A Science and an Art TYPE OF INVESTOR Issue Aftermarket INSTITUTION UNDERWRITE BUY RETAIL BUY HOLD STAGS BUY SELL - PERFECTING YOUR PITCH - The Secrets of Superb Public Speaking – John Miers 2009
- 17. Seating - PERFECTING YOUR PITCH - Both Sides of the Table
- 18. Eye Contact - PERFECTING YOUR PITCH -
- 19. Demo
- 22. Tell Me What You Do Describe the problem you solve. “We sell [hardware/software] that helps [our target market] to [save money or make money]” - PERFECTING YOUR PITCH -
- 23. Tell Me What You Do - PERFECTING YOUR PITCH -
- 25. PRESENTATION
- 26. Slides - PERFECTING YOUR PITCH - Company Description Team Problem or Need Solution/Demo Value Proposition Addressable Market, Traction Competition Sales and Marketing Strategy Revenue Model Projections Roadmap Summary Contact Information Appendix 10 seconds to 2 minutes each
- 28. Snapshot $2m for an active board seat 2
- 29. Team • John, CEO • Former ABC, XYZ • Jim, CTO, Founder • Former ABC, PQR • VP Marketing • Identified • David, Board Member • DEF, PQR . 3
- 30. Industry Problem Revenue is dropping Expenses are rising Customers are leaving 4
- 31. Our Solution 5 “This should save us $100 per employee per year” Mr. Big, CEO of Target Customer
- 32. Our Solution 5 Reference Clients Annual $ Buying Decision ABC Co 35,000 Access from the cloud LMN Ent. 42,000 Flexible pricing XYZ Inc. 25,000 Convenience, time savings • Relate each decision to value • “Price” is a problem
- 33. Demo
- 35. Traction
- 37. Sales and Marketing Strategy Pricing strategy Target markets Channels or partners Current funnel 8
- 38. Road Map 11 Year 1 2 3 4 5 Early Adopters Crossing the Chasm Mainstream Growth Design Beta, one sector Full Launch IP Roadmap Funding Roadmap ExitRevenue RoadMap today Alpha Seed, Angel$1.2m F, F & E$0.3m Series A$4m Series B> $10m Expan- sion
- 39. Projections 9
- 40. Projections 10
- 41. • Team • Traction • Timing 13 Summary
- 42. Appendix 14 •IP Summary •Development Roadmap •Market Segments •Use Case – Primary Markets •Use Case – Secondary Markets •SWAT Analysis •Positioning Detail •Channel Detail •Pricing Detail •Market Trends •Tech Trends •Proforma HR •Cap Table •Uses of Capital
- 43. Follow up - PERFECTING YOUR PITCH - • A short email that night • Answer open questions and tasks • Lead into next steps
- 44. Avoid Saying… • ‘Our projections are conservative’ • ‘We have no competition’ • ‘We have a first mover advantage’ • ‘We only need to capture x% of the market share’ .D - PERFECTING YOUR PITCH - .
- 46. Tell Me What You Do Describe the problem you solve. “We sell [hardware/software] that helps [our target market] to [save money or make money]” - PERFECTING YOUR PITCH -
- 47. Objectives
- 48. Murphy’s Law
- 49. High Valuation Trap Problem: •Follow-on investors value lower than last •Forced to “cram down” last investors or no deal Solution: •Understand downstream valuations .
- 50. Valuation • Consider the post $ cap table for the next round • And subsequent rounds to the exit .
- 51. Exit Valuations • Multiple of –Revenue (eg. $10m x 2 = $20m) –Profit or EBITDA (eg. $3m x 6 = $18m) • Discounted Cash Flow (can be lame) • All are better when company is growing –(Importance of timing) .
- 52. Thank You . david@davidshore.com@davidshore DavidGShore This deck is available at slideshare.net/davidshore