Basics of finance for startups and early stage companies. Presentation delivered at ICT Summit, Warsaw, Poland on December 4, 2014.

1. STARTUP FINANCING
FROM CROWDFUDNING TO DEBT & EQUITY
Tytus Cytowski,
Managing Partner
ICT Summit
WARSAW, POLAND
December 3, 2014

2. CYTOWSKI LLC
Disclaimers
 Any US federal tax advice contained in this presentation is not intended to be used,
and cannot be used, to avoid penalties under the Internal Revenue Code or to
promote, market or recommend any transaction or matter addressed herein.
 This material is for informational purposes only and do not constitute advertising, a
solicitation, or legal advice and should not be construed as legal advice for any
purpose whatsoever.
 Information contained herein is not intended to create, and receipt thereof does
not constitute formation of, an attorney-client relationship.
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3. TYTUS CYTOWSKI
Attorney at Law
EDUCATION
• HARVARD LAW SCHOOL (LLM)
• WARSAW UNIVERSITY (Mag Iur)
EXPERIENCE
• STARTUPS
• VENTURE FINANCING
• FUND FORMATION
ADVISOR
• STARTUPWISEGUYS (Estonia)
• DEFY VENTURES (NYC)
CLIENTS
• EU, USA
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4. DANKE!
STARTUP FINANCE
WWW.CYTLAW.COM
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IS NOT …

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6. DANKE!
WWW.CYTLAW.COM
FUNDRAISING HARD WORK
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7. LETTER TO SANTA CLAUS
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Friends &
Family
Angel
Investment
Seed VC VC – Series A
Round Size $10 G - $100 G $100G - $1 M $500G - $1.5M $5M -$15M
Investment Size $5 G - $25G $25G - $75G $250 - $750G $3M - $5M
Valuation < $1 M $1 - $5 M $5 - $10M $10M - 25M
Stage - Idea
- B-Plan
- Full time
Founders
- Detailed B-Plan
- Customers,
pilot, revenue?
- Legal
Documents
- Full time
Founders
- Detailed B-Plan
- Customers,
pilot, revenue?
- Legal
Documents
- Income
- Next Funding
- Business Model
- Brake Even
- Big Client
- Growth Potential
- Income
- Angels
-Key Management

8. DANKE!
WWW.CYTLAW.COM
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CAP TABLE

9. DANKE!
WWW.CYTLAW.COM
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VALUATION

10. STARTUP FINANCE - 101
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BUILD
RELATIONSHIPs/COMMUNITY
THEN… RAISE MONEY

11. STARTUP FINANCE – 101
DANKE!
WWW.CYTLAW.COM
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ART OF PRICING
RISK

12. MORE RISK
= NEED TO
GIVE MORE
UP
11 STARTUP FINANCE - 101

13. YOU CAN SELLA LOT
OF THINGS FOR MONEY?
DANKE!
WWW.CYTLAW.COM
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YO
STARTUP FINANCE – 101

14. EQUITY
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15. DEBT
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16. DANKE!
WWW.CYTLAW.COM
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PRODUCT
via crowdfunding

17. DANKE!
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CROWDFUNDING
FINANCE IS EASY
WHAT ABOUT
US TAX?

18. DANKE!
WWW.CYTLAW.COM
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INCOME?

19. DANKE!
WWW.CYTLAW.COM
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NON-TAXABLE
GIFT?
$14 G
EXCLUSION

20. DANKE!
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STATE SALES
TAX

21. DANKE!
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CONVERTIBLE
DEBT

22. DANKE!
WWW.CYTLAW.COM
SAFE
KISS
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23. DANKE!
WWW.CYTLAW.COM
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HOW DO
YOU
CONVERT
DEBT INTO
STOCK?

24. DANKE!
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DISCOUNT

25. DANKE!
WWW.CYTLAW.COM
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CAP

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EQUITY

27. LIQUIDATION
PREFERENCE
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28. DANKE!
WWW.CYTLAW.COM
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SIZE
MATTERS

29. SIZE OF
EQUITY
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30. SIZE OF EXIT
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31. OPTION POOL
DANKE!
WWW.CYTLAW.COM
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32. LIKE US ON FACEBOOK!
www.facebook/cytowskillc
FOLLOW ON TWITTER
@tcytowski
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