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Startup Fundraising 101
- 1. Startup Funding 101: How To Get Started, with Adeo Ressi
- 2. Meet Today’s Moderator Shahab Kaviani Co-Founder | CMO, Onevest • 10+ years as a startup founder • Previously co-founded CoFoundersLab and HyperOffice (exited) • Raised over $800k – including a portion via equity crowdfunding
- 3. Disclaimer Securities offeredthrough WealthForge, LLC. Member FINRA/SIPC Onevest Corporation ("Onevest") is not a registered broker-dealer and does not give investment advice with respect to any securities. All the startup offerings listed are offered by the applicable Issuer. Onevest has not taken any steps to verify the accuracy of the information provided on the offerings that are listed. Onevest takes no part in the negotiation of the transaction and no securities are executed through Onevest's platform. Onevest receives no compensation in connection with the purchase or sale of securities. Testimonials may not be representative of the experience of all clients. Testimonials are not a guarantee of future performance or success.
- 4. CAPABILITIES STATISTICS 50,000Entrepreneurs and Investors 7,000 introductions per month Companies who have worked with Onevest have collectively raised over $100M in funding Equity crowdfunding Founder-matching via website and events Connecting investors with promising startups Free live educational webinars
- 5. SUCCESSFUL MATCH SUCCESSFULLYRAISED Boulder, CO Built their team on Onevest Techstars Alumni AusCn, TX Raised $750K w/ the help of Onevest Capital Factory Alumni
- 6. The New Worldof Funding Don’t Be Shooting Blanks
- 7. 3 Sources ofCapital Start Here ITEM FOOLS ANGELS VCS Full-time Team or Founders - 1 > 2 Proven Domain Expertise - PARTIAL YES Functioning Prototype - YES YES Initial Customer Adoption - YES STRONG Finished Product - - YES Proven Customer Use Cases - - YES Monthly Growth >20% - - YES AMOUNT $25-50K $250-750K $1.5-3.0 MM
- 8. What to Expect • 1 Full-time CEO Founder • 20 Hours per Week • During All Hours • 3 to 6 Months • $5,000 - $15,000 in Legal • Economics – Time Invested = 240 Hours – Earning per Hour = > $1,000
- 9.
- 10. your only goalis to find a lead
- 11. The Role ofthe Lead • Complete diligence on your company • Provide credibility to other angel investors • Set financial terms of the investment • Provide operating expertise and advice
- 12. 1. Interest inYour Segment 2. Financial Resources 3. Time & Risk Readiness
- 13. Lead 30 Posers 20 Interested 10 Investors 1 Lead
- 14. you will getblacklisted by premature fundraising
- 15.
- 16.
- 18. Lead Follow OnConnector 1 2 3
- 19.
- 20. start by buildinginterest, then convert to a lead
- 21. 1.Meet 2.Invite toCoffee 3.News Update 4.Meet at Event 5.Dinner Invite 6.Funding Ask 7.News Update 1 2 ~ 50% 3 4 5 6 7 Likelihood to Close Time ~ 1 Month
- 22. the goal ofeach meeting is to get to the next meeting
- 23. Soft Circled HardCircled $75,000 $200,000 75% Likelihood 25% Likelihood
- 24.
- 25. “Would you beinterested in being an advisor and leading the round?”
- 26. Compensate the Lead • Offer an Advisor Position – Only AFTER agreement to lead – Start with off the Board, but Board Possible • Offer Advisory Shares – 0.5% to 2.5% in options that vest over 2 year
- 27. Propose the Terms • Outline Terms to Lead – Start with a friendly Convertible Debt Round • Have Company Counsel Draft Term Sheet – Reduce the costs of lead’s legal • Produce the Final Agreements – Simplify time required to lead
- 28. Build Buzz •Plan a Series of Company Internal Milestones – Ensure updates in a monthly newsletter • Organize One Public Announcement before Close – External validation is key, such as partnerships • Ensure Metrics are Moving Up and to the Right – Bad performance during fundraising can kill a deal
- 29.
- 30. Needed to Close • Strong company counsel engaged • Agreed upon Term Sheet • Minimum closing amount • Minimum investment amount • Initial closing date • Maximum amount with a rolling close
- 31. The Round Composition ITEM NUMBER TARGET MIN MIX Lead Investor 1 1 $50,000 $500,000 + Large Angels 0 - 5 1 $50,000 $250,000 + Small Angels 0 - 10 3 $10,000 $25,000 Friends 0 - 3 0 $5,000 $10,000 TOTAL - 5 - 6 $250,000 $500,000
- 32. Equity or Convertible ITEM EQUITY CONVERTIBLE Term Sheet 3 Pages 1 Page Closing Costs $15 - $25,000 $5 - $15,000 Position Preferred Owner Option Control Board and Operations Requiring Capital Negative Hard to Price Equity New Positive Clear Ownership Easy and Fast
- 33. Valuation ITEM LOWHIGH Pre Money 1,000,000 5,000,000 Raise 150,000 1,000,000 Post Money 1,150,000 6,000,000 Option Pool 10% 20% Ownership 13.0% 23.1% Fully Dilluted 12.7% 19.6%
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- 35. There are noshortcuts.
- 36. Tips • Bepatient and build the relationship • Don’t ask for investment if “no” is likely • Investors will say “yes,” but will not fund you • Practice and refine the pitch constantly • Don’t give benefits until the deal is done • Stick to the facts • Don’t overpromise
- 37.
- 38. Next Steps •Visit Onevest.com • Visit Learn.Onevest.com • Twitter: @onevest • Facebook: /onevest