Financing Your Invention

Financing Your Invention Curtis V Palmer, President / CEO TechBirmingham

Thinking About Pursuing VC Funding?

Where Does VC Money Come From? ,[object Object],[object Object],[object Object]

How are Venture Capital Funds Organized? ,[object Object],Venture Capital Fund Limited Partners Pension Funds, Educational Endowments, Foundations, Insurance Companies, Wealthy Individuals General Partners These are the “Venture Capitalists” you will deal with. They may have been Entrepreneurs in a prior life or they might be financial types. The General Partners use an Offering Memorandum to raise a fund of a given size from the Limited Partners by convincing them that the GPs have a unique strategy or expertise in a particular sector or sectors of the market. Fund raising can take a year or more. If the GPs are successful they will convince enough Limited Partners to invest enough money to achieve the size fund offered. When this happens there is a first “close” of the fund.

What Do Venture Capitalists Do? ,[object Object],[object Object],[object Object],[object Object],[object Object]

Managing the VC Investment ,[object Object],[object Object],[object Object]

VCs Want “Exits” ,[object Object],[object Object],[object Object]

Fund Investment Cycle ,[object Object],[object Object],[object Object],[object Object]

Things For You to Think About ,[object Object],[object Object],[object Object]

More Things to Think About ,[object Object],[object Object],[object Object]

Even More To Think About ,[object Object],[object Object],[object Object]

Making Your VC Pitch ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

VC Pitch Pointers ,[object Object],[object Object],[object Object],[object Object],[object Object]

VC Strategy ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Questions to Expect from a VC ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

BizPlan As A Financing Document

How a VC Reads your Plan ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Making the First Cut ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Why Plans Fail the First Cut ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

More Reasons Plans Fail ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

“Cosmetic” Reasons for Failing ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Valuation as a Driver of Financing

Valuation ,[object Object],[object Object],At Any Given Time Your Company Is Worth What Someone Will Pay For It At That Time

What Determines Valuation ,[object Object],[object Object],[object Object],[object Object],[object Object]

Valuation ~ Macro Drivers ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Valuation ~ Positioning ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Debt Financing ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Equity Financing ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Miscellaneous Financing ,[object Object],[object Object],[object Object],[object Object],[object Object]

Inventor’s Funding: Many Options ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Minimize Funding Requirements ,[object Object],[object Object],[object Object],[object Object]

Pull… don’t Push Customer Need (Demand) Inventor Company Purchases $ Purchases $ Market Pull Customer Need (Demand)? Inventor Company Invention Search? Market Push

Benefits of Customer First ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Common Sense Approach ,[object Object],[object Object],[object Object],[object Object],[object Object],2. Identify a compelling need Talk to : potential customers, potential competitors, partners, advisors, investors/creditors, “multipliers” 3. Generate customers Talk to : potential customers, potential competitors, partners, advisors, investors/creditors, “multipliers” 4. Sell solution 5. Build & deliver solution

Curtis V Palmer [email_address] www.TechBirmingham.com

Financing Your Invention

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Financing Your Invention