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MOVING
   BEYOND
   THE FIRST
   DATE

© 2008 North Venture Partners, LLC | www.dontgosouth.com | www.northangels.com
1.0




      Speed without
      direction is the
      fastest way to
      getting nowhere.
       On your marks, get s...
We’re Actually On The Same Team.
          Like most Angel investment groups we do not manage a fund. We provide our
     ...
Psst. Investors Don’t Read Business Plans.
          Most Angel groups are buried in submissions from entrepreneurs who ha...
It’s Time To Break Free From The Broken.
         Before the internet, entire industries emerged that helped investors fin...
There Is A Smarter Way To Find Capital.
      While we have to admit there is an intoxicating rush from pitching your
    ...
Say Hello To The Venture 360 Report.
                By providing detailed and objective analysis, and then sharing the re...
A Long Hard Look Pays Off For Everyone.
          Ultimately investors and entrepreneurs are betting on the same thing: th...
Pointing You On The Right Path to Funding.
      North’s objective analysis and contextual scoring of thousands of new ven...
Taking The Mystery Out Of Venture Marketing.
      The high cost of professionals who market ventures to investors can be
...
Even The Best Benefit From A Second Shot.
       We truly believe that success comes through hard work and persistence. Th...
Time To Put Some Skin In The Game.
       By now you should hopefully understand what it takes to get through this
       ...
Chances Are We’ve Got You Covered.
       While our roster is deep, we can’t provide reports on everything under the sun.
...
Ready to Head In The Right Direction?
              We invest significantly in the ventures we team up with, and the last ...
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Venture 360 Report Overview For Entrepreneurs 1232000447204805 2

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Venture 360 Report Overview For Entrepreneurs 1232000447204805 2

  1. 1. MOVING BEYOND THE FIRST DATE © 2008 North Venture Partners, LLC | www.dontgosouth.com | www.northangels.com
  2. 2. 1.0 Speed without direction is the fastest way to getting nowhere. On your marks, get set, hold on… If you’re reading this, that means we’re interested in taking the next step towards making your venture a success story. But before we decide to move in together, exchange vows, and live happily ever after, we’ve still got work to do. The process of raising capital in the private equity market can often be misunderstood. So to help familiarize you with our process, and what the next steps are, we first want you to to understand a bit more about how Angel groups work. Sorry if this is redundant, but you’d be shocked by how many times we’ve had to explain this.
  3. 3. We’re Actually On The Same Team. Like most Angel investment groups we do not manage a fund. We provide our investor members with a service, which at the most basic level, is a filter for sifting through thousands of investment opportunities. Contrary to popular belief, we don’t just write checks like a VC. We (the group managers) usually have to work twice as hard to get all the parties around the table excited to work together. This means that we are in this together. We are both going to work towards the same goal; getting your venture funded. 2.0 Investors expect us to make it easy for them to make an informed and intelligent investment decision. It’s our job to make investing more educated, empowering, and rewarding. Is our job easy? Hardly. Managing a group of successful, critically-thinking high net worth investors is no walk in the park. To wage this war we’ve armed ourselves with the best possible processes and tools to enable us to be highly effective at getting your venture funded as quickly as possible. To get under the hood and really understand why we do what we do, it usually helps for entrepreneurs to see the world from the other side of the table.
  4. 4. Psst. Investors Don’t Read Business Plans. Most Angel groups are buried in submissions from entrepreneurs who have “remarkable products, stellar financials, and a world-class management team”. Or at least that is what their business plan would say if they actually had the chance to read it… 3.0 The truth is most investors simply can’t take the time to read thousands of business plans. So how can they possibly find, filter, and fund the most promising new venture investments in an ocean of possibilities? Do the math: Right now there are over 37,000 business plans on AngelSoft. There are over 100,000 plans on FundingPost. There are over 6,000 plans on Funding Universe. If an Angel investor tried to review all these plans for 30 minutes each it would take over 33 years reading 8 hours a day, 5 days a week, for 52 weeks a year. Bottom line: Blasting your business plan out to several hundred Angel groups with the click of a button is about as strategic as buying a Powerball ticket. This is clearly a problem for investors AND for entrepreneurs.
  5. 5. It’s Time To Break Free From The Broken. Before the internet, entire industries emerged that helped investors find “good” entrepreneurs; trade shows, print publications, and an army of investment banking connectors who helped introduce entrepreneurs to investors (for a large fee of course). You can spend half your career (and life savings) at trade shows and more often than not all you would have to show for it would be a desk drawer full of name badges. 4.0 Today’s investors rely more than ever on their filter of trusted referrals and connections with friends. Tip: trust is not earned swapping cards at a trade show booth. This traditional process needed to evolve, not because it wasn’t an effective method for discovering a high number of venture investments, but because investors needed an easier way to reduce their number of investment options down to a more manageable and quality figure. So we asked the question, “what if there was a way for investors to discover investment opportunities based up on the strength of the venture, rather than the reach of their personal network?”
  6. 6. There Is A Smarter Way To Find Capital. While we have to admit there is an intoxicating rush from pitching your innovative venture in front of an audience, the end result usually feels more like a hangover. Investors with more questions than answers, and entrepreneurs leaving wondering if their choice of wardrobe sealed the fate of their company. 5.0 True understanding of a venture, the management team, and the target market doesn’t happen during a 15 minute pitch in a hotel ballroom. The speed pitch of the 1990s provides no value for anyone in the room, except maybe the caterer. We know, because we’ve walked in your same shoes. That’s why we’ve spent the last two years developing a more future-forward approach to business building; a disciplined and proprietary methodology for scoring, evaluating and selecting new venture investments. Utilizing a combined human and database-driven due diligence process, North scores ventures across 80 categories providing finely tuned analysis and insight across all critical aspects of each new venture.
  7. 7. Say Hello To The Venture 360 Report. By providing detailed and objective analysis, and then sharing the results with both the entrepreneur and the investor, we’re able to achieve a unique result: crystal clear direction for everyone involved. 6.0 From deconstructing the financials to target market analysis; the strengths and weaknesses of each venture opportunity are reviewed in detail so investors and entrepreneurs can make confident decisions based on reliable data, not just intuition. 20+ Pages of Rigorous Insights & Scoring Comparative Graphing & Performance Chart & Due Diligence Across 8 Categories Written Analysis Executive Summary
  8. 8. A Long Hard Look Pays Off For Everyone. Ultimately investors and entrepreneurs are betting on the same thing: the success of the business. A three year study of 539 Angel led investments conducted by the Kauffman Foundation found an extraordinary insight. 7.0 “Comparing investors who spent less than the median 20 hours of due diligence and investors who spent more, shows an overall multiple difference of 5.9X for those with high due diligence compared to only 1.1X for those with low due diligence.” Excerpt taken from “Returns to Angel Investors in Groups”, a comprehensive study of 539 Angel led investments. Robert Wiltbank, Ph.D. and Warren Boeker, Ph. D., 11/2007. Whether you’re an entrepreneur betting your career, or an investor betting your capital on an exciting new venture, what type of return on investment are you seeking? 590% or 110%? If a venture doesn’t succeed nobody wins, so it’s in all of our best interest to stress test the business well before we make the relationship “official”.
  9. 9. Pointing You On The Right Path to Funding. North’s objective analysis and contextual scoring of thousands of new ventures is the foundation of our Angel groups decision process. It’s what makes us different. It’s what makes us better. It’s our secret 11 herbs & spices. But the Report is only the first step, the next step is getting it in the hands of investors. 8.0 Each month the top scoring reports are published and promoted to the full North Angels membership which consists of individual investors, other Angel groups, and institutional investors. Note: You might not like what the report has to say, but you should realize that neither investors, entrepreneurs, or North are well served by spending weeks, or months trying to move a venture forward if it is fundamentally flawed. Our third party analysis and report marketing can either accelerate your conversations with investors, or it can give you the direct and honest feedback you need to dig in and re-tool your business to put it on the right path to success.
  10. 10. Taking The Mystery Out Of Venture Marketing. The high cost of professionals who market ventures to investors can be downright frightening, and with nearly no visibility into the process it can mean a giant leap of faith for entrepreneurs. And nobody likes buying on faith alone. 9.0 Save the trust falls for management retreats. North’s Investor Interaction Report shines light into the dark corners of investment marketing; giving you confidence & clarity by sharing exactly what is happening with your Venture 360 Report, right down to every little click. Published Venture 360 Reports have embedded code that tracks each and every investor interaction. North provides accountability to the entrepreneur by tracking everything, right down to the number of seconds an investor spends reading each page of the report. Don’t throw darts in the dark. Before you invest your time or money in marketing your venture to investors, first make sure you’re able to see the results of your efforts.
  11. 11. Even The Best Benefit From A Second Shot. We truly believe that success comes through hard work and persistence. That’s why North offers entrepreneurs a second chance to make a favorable, first impression. 10.0 Michael Jordan was once cut from his high school basketball team. Sometimes setbacks prepare us to reach even greater heights. We all know where His Airness ended up. Do you know how you will respond to the challenges that your business will face? Each recipient of a completed Venture 360 Report has the option to wait 90 days and then re-submit their business for a full Venture 360 Report at no additional cost. While not every venture will need it, this “second shot” enables an entrepreneur to apply the insights garnered from their first report, as well as include other improvements to their business, to make an Angel investment more conceivable. Second chances are rare in life. They’re even more uncommon in the board room. Because we feel so strongly that the process for seeking investment capital needs to be more holistic, we give entrepreneurs the option to use what we offer to strengthen their venture and increase their odds of starring in their own comeback story.
  12. 12. Time To Put Some Skin In The Game. By now you should hopefully understand what it takes to get through this process. It requires commitment, perseverance, and above all, takes faith in your abilities and the strength of your idea. Nothing worthwhile is ever easy. 11.0 We think of the Venture 360 Report as the best possible way to introduce your innovative venture to investors. For North Angels, this is the only way. The Two Phase Process For Going North: Phase I - Completing a Venture 360 Report (Roughly 5-10 business days) 1. Document Review & Target Market Analysis 2. Financials Deconstructed & Sensitivity Testing 3. Management Team Interview & Q & A Session 4. Reference Checking & Lexis Nexis® Background Reporting 5. Internal Draft 1.0 Report Review & Final Partner Revisions Phase II - Report Distribution & Investment Marketing (Roughly 4-6 weeks) 1. Final Report Distributed to Angel Investors (Investor Interaction Report) 2. Angel Group Member Capital Call & Additional Due Diligence 3. Finalize Financing Agreements & Complete Funding Transaction
  13. 13. Chances Are We’ve Got You Covered. While our roster is deep, we can’t provide reports on everything under the sun. If a venture falls outside of our coverage areas of expertise, we’ll probably have to wave the white flag and refer you to a subject matter expert. 12.0 North executes reports across 8 market sectors enabling us to cover 85% of all submissions. Marketing these reports to a large & diverse group of Angels forms our foundation for fostering innovation. For each industry there are various North Market Coverage economic models, industry standards, and consumer behaviors. Each of these unique Media & Entertainment factors is incorporated into the venture Consumer Products & Services evaluation. The strength and accuracy of the North database of reviewed ventures is Software & IT Services enhanced by our market segmentation. Mobile Devices & Applications Note: The overall scoring and analysis output is calibrated to seek the greatest Business Products & Services possible economic return regardless of market sector. Retail / Distribution Sustainable Industries / Energy
  14. 14. Ready to Head In The Right Direction? We invest significantly in the ventures we team up with, and the last thing we ever want is a partnership of inequality. 13.0 We believe our time and effort must be something you value enough to invest in moving our partnership forward. Reports are scheduled on a first come first served basis. All fees are billed in advance of the project kickoff. The non-refundable report fee covers: • Phase I and II of the North Venture 360 Report Process • All North Analyst and Partner Expenses & Fees • All Third Party Fees (Lexis Nexis Background Report) • Report Publishing, Printing, & Marketing Expenses • Investor Interaction Tracking Reports • North Reference Calls With Investor Candidates. To engage with North and take the next step forward, send an email to northventure360@dontgosouth.com stating that you’re ready to rock. Read more about what we do at: Northern California Southern California www.dontgosouth.com 1729 Telegraph Ave 4316 Melrose Ave. Oakland, CA 94612 Los Angeles, CA 90029

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