Startup Now! Building it Right From the Start

1. VC Perspective
Building it Right from the Start
Gal Israely
Managing Partner
Cedar Fund
1

2. Cedar Fund
• Founded in 97 with $325M under management
• $100M 2008 fund that we invest from
• 4 Partners
• Portfolio: 25 companies
2

3. Investment Stages
• Initial revenues
• 1st round
• Seed
• Pre-seed®
3

4. What do we look for?
• Team
• Market
• Product
• Clear business and financial plan
• After seed - Company track record
4

5. What is Pre-Seed® ?
• Pre-Seed® is a process that a team with
“no idea” goes through to:
– Come up with a Killer App
– Validate
– Come up with a financial plan
5

6. Cedar’s Pre-Seeds®
6

7. Start right – team
• Start with people – a team of 2-4
– CEO
– CTO
– Bus. Dev./Sales/other technical
• Top People who can come up with an idea and execute
• Experienced Entrepreneurs
• Know each other
• Add luck and mix
7

8. The search for the killer app.
• Look under your lamps
• Speak with the people that matter – Customers
• Be thorough
• Think out of the box, be creative
• Don’t give up
8

9. Think business
• We identified a problem!
• Pain - nice vs must
• Is it large enough? $$$
• How do I make money?
• Not how do I change the world
9

10. Three customers
• Your market
• Financing market
• Exit market
10

11. Timing is everything
• Too late
• Too early
• Perfect timing
11

12. The ultimate Seed
• Top integrated team
– CEO
– CTO
– Bus. Dev./Sales
• Market – Potentially large and growing
• Product - Validated
– Needed, Unique bus and technology, Competitive
– Clear go to market
• Attractive financial plan
– What is the needed investment?
– How can we make money?
12

13. Lessons learned
• The process works
• Understanding the customer market
• No way to guess
• Too early
13

14. The Recipe
• Start with exceptional people
• Add:
– Market
– Customers
– Money
– Brainstorming
– Luck
– Cedar
• MIX
14

15. Thank You
Gal Israely
Managing Partner
Cedar Fund
15