The document discusses the changing landscape of early stage investing and startups. Key points include: 1) Startup costs are lower than ever due to cloud computing and open source tools, but scaling still requires money. 2) Traction, not just technology differentiation, is now critical for startups to succeed. 3) Capital is becoming commoditized with the rise of angel investors, and money now follows great founders. 4) New techniques using big data and analytics are being used by VCs to evaluate investments, similar to techniques used in other industries.

1. @paulsingh #GLDemoDay
THE RISE OF THE ANGELS
(AND THE ENTREPRENEURS)
PAUL SINGH
@paulsingh・paul@500startups.com・resultsjunkies.com

2. @paulsingh #GLDemoDay
GETTING TO KNOW
500 STARTUPS BECAUSE WE’RE KIND OF A BIG DEAL
PAUL SINGH
@paulsingh・paul@500startups.com・resultsjunkies.com

3. @paulsingh #GLDemoDay

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(R)EVOLUTION IN THINKING

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EARLY STAGE
STARTUPS
HAVE CHANGED

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CLOUD, OPEN SOURCE AND ONLINE DISTRIBUTION DRIVING
STARTUP COSTS
LOWER THAN EVERBUT SCALING STILL COSTS MONEY

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WEB GETS BIGGER.
WORLD GETS SMALLER.

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TRACTION IS THE NEW
INTELLECTUAL PROPERTY
PLATFORMS (SEARCH, SOCIAL & MOBILE) PRIMARILY DRIVING THE CHANGE.
NO LONGER “GOOD ENOUGH” TO DEPEND ON TECH DIFFERENTIATION.

9. @paulsingh #GLDemoDay
CAPITAL
INCREASINGLY
COMMODITIZED
RISE OF THE ANGELS, YO!

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NEW REALITY:
MONEY FOLLOWS
FOUNDERS
RISE OF THE ENTREPRENEURS, YO!

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SIGNALS ARE
EVERYWHERE
BIG DATA + OPEN SOURCE ANALYTICS = NEW TECHNIQUES FOR VC

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SIGNALS ARE
EVERYWHERE
BIG DATA + OPEN SOURCE ANALYTICS = NEW TECHNIQUES FOR VC

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TRANSPARENCY IS
SIGNALS ARE
EVERYWHERE
BIG DATA + OPEN SOURCE ANALYTICS = NEW TECHNIQUES FOR VC

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WALL STREET
BEAT US TO IT

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“ UBS PROPRIETARY
SATELLITE PARKING LOT
FILL RATE ANALYSIS
POINTS TO AN
INTERESTING CADENCE
INTRA-QUARTER AND
POTENTIAL UPSIDE TO
OUR VIEW.

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“
TWICE A WEEK A SMALL
HELICOPTER CIRCLES
OVER CUSHING’S TANK
FARMS ON AN OIL
INDUSTRY SPYING
MISSION.

19. @paulsingh #GLDemoDay
WALL STREET
ISN’T ALONE
THESE TECHNIQUES ALREADY USED TO UNDERWRITE IN-VITRO
FERTILIZATION LENDING, PAYDAY LOANS, SUBPRIME AUTO
LENDING, HOME/PERSONAL/AUTO INSURANCE AND MORE.

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IT TURNS OUT,
WE CAN DO IT, TOO SURPRISE!

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+ “GUT” + TRUSTED MENTORS + MUCH, MUCH MORE DATA.

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WE CAN DO IT, TOO.

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WE CAN DO IT, TOO.

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WE’RE DOING IT, TOO.

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“ VENTURE CAPITAL IS
OPEN TO ATTACK BY
DISRUPTIVE NEW
BUSINESS MODELS AND
TECHNOLOGY.
-- NAVAL RAVIKANT (@naval)

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EARLY STAGE VC
IS CHANGING
HAS CHANGED

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STATE OF THE ART IN EARLY
STAGE INVESTING IS NOT
VERY SOPHISTICATED

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UNBUNDLING OF
ADVICE, CONTROL
AND MONEY

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USED TO BE ABOUT
CAPITAL, DEALFLOW
AND JUDGEMENT
TODAY, IT’S ABOUT ACCESS.

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“ BY ITS NATURE, THE
INTERNET UNDERMINES
ANYONE WHOSE STATUS
DEPENDS ON
PRIVILEGED ACCESS TO
INFORMATION.
-- MICHAEL LEWIS

33. @paulsingh #GLDemoDay
Demo Day Videos ⟹ livestream.com/500startups
Sample Pitch Decks ⟹ slideshare.net/500startups
Venture Capital 101 ⟹ venturehacks.com/archives
Investor Thoughts:
Brad Feld ⟹ feld.com
Fred Wilson ⟹ avc.com
Chris Dixon ⟹ cdixon.org
Mark Suster ⟹ bothsidesofthetable.com
angel.co/valuations and angel.co/salaries

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YOUR KEY TAKEAWAYS

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YOUR KEY TAKEAWAYS
Focus on Traction.

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YOUR KEY TAKEAWAYS
Focus on Traction.
Learn to Communicate and Inspire.

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ALSO...

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ALSO...
Think about distribution a lot

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ALSO...
Think about distribution a lot
Focus on customer acquisition

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ALSO...
Think about distribution a lot
Focus on customer acquisition
Get on AngelList

41. @paulsingh #GLDemoDay
ALSO...
Think about distribution a lot
Focus on customer acquisition
Get on AngelList
Learn the basics of VC economics

42. @paulsingh #GLDemoDay
ALSO...
Think about distribution a lot
Focus on customer acquisition
Get on AngelList
Learn the basics of VC economics
Raise 12-18 months of funding

43. @paulsingh #GLDemoDay
THE RISE OF THE ANGELS
(AND THE ENTREPRENEURS)
PAUL SINGH
@paulsingh・paul@500startups.com・resultsjunkies.com