Introduction to Angel Funding - Startupvillage


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Introduction to Angel Funding - Startupvillage

  1. 1. Angel FundingPadmaja RuparelIndian Angel Network
  2. 2. Historical Perspective India has always been entrepreneurial  25% of world economy in 1700  Colonization & subsequent socialism - adverse impact  Old ―DNA has resurfaced with vengeance post liberalization >250 mn middle class provides a large market  Share of middle class rose from 15% in 1993 to over 47% in 2010 IT Industry paved the way US$ 60 mn to US$ 60 bn in 20 years 99% first generation entrepreneurs Entrepreneurship emerging growing across all industries :, Education, Healthcare, Retail, Cleantech, .. “Old” industries / business groups resurrected & how !  Tatas, Birlas & others
  3. 3. Statistics or Opportunities Mobile Phones: Total cell phones - 950 M, Total number of smart phones – 450 M, Monthly compared to ~500 M cell phones in USA Land Prices: Average price per square foot for apartment in south Mumbai - $3500 compared to Manhattan condos - $1210 Automobiles: 67 million passenger vehicles, seventh largest vehicle manufacturer in world, fourth largest Asian exporter of passenger vehicles after Japan, Korea and Thailand, second fastest growing automobile market in world Internet: Third largest in the world after USA and China. 100 M users spends 16 hours per week on Internet Gold Consumption: Highest in India (1,100 tons), second highest in China (782 tonnes)
  4. 4. Entrepreneurship convertsJob Seekers to Job Creators Creates Employment Creates Wealth Creates Innovation Creates Self Sustaining Economic Growth And to drive this the most effective mechanism created by Man :Angel Investment & Venture Capital Model
  5. 5. Venture Creation : Value ChainIdeation Deployed Growth Scale up ExpansionTeam Angels plus Angel Grants Fund Venture Capital Funds IPO / Strategic Investors
  6. 6. Angel Investment Investments in early stage / start up companies Addresses the gap for funding early stage companies Investors access constant flow of high quality deal flow to spread their risks Network’s multiple domain expertise enables exploiting opportunities across sectors Angel investments - a new asset class Provide entrepreneurs strategic inputs, advice and mentoring with access to valuable networks Opportunity to create disproportionate wealth creation for all stakeholders Commitment of Money, Time, Expertise & Networks
  7. 7. IAN :For Entrepreneurs By Entrepreneurs India’s most complete player in the early stage eco system India’s first and largest business angel group Over 200 Investor members who are successful entrepreneurs & dynamic CEOs Network members from across India and overseas  Entrepreneur pitch meetings in Delhi, Mumbai, Bangalore & Pune every month Concept has found resonance with corporates like Intel, Google; VCs like SIDBI, Sequoia, Nexus, RVCF, etc. Unique model of Incubator in PPP model  With 26 incubatees signed up  200 + mentor network in place
  8. 8. Where are we today 36 investments made to date across multiple sectors - Software Products - Education - CRO - Mobile Apps - Hospitality - Consumer Internet - Robotics - Ecommerce - IT Infrastructure - Medical Devices - Semiconductor - Cloud based Over 325 deals received per month, several deals on the anvil for investment Operations in Delhi, Mumbai, Bangalore, Hyderabad & Pune, processes established Several partnerships forged  TIE – ideal feeder for deal flow  IVCA – ideal partner for exits  NASSCOM – ideal partner for innovative cos. in IT / BPO  NEN – ideal feeder for seed stage deal flow  UKIBAN – Cross border Angel Network  FBA – Partnership with Femmes Business Angels in Paris  WBAA – Founder member to partner with world angels  BANSEA – Business Angel Network South East Asia
  9. 9. What do Angels look for
  10. 10. The Proposition Clear definition of product or service Is it already developed or can you validate that it can be developed Have you clearly defined your customer Why is your product / service necessary Is it doing something Different / Differently Is it “need to have” / “nice to have” If IP based, patenting status
  11. 11. The Market What is the space Is it large and rapidly growing What is the competition to your product What is your strategy to deal with competition Has any market validation happened
  12. 12. Execution How will you deliver Experience of pilots, prototypes etc What is your sales / marketing plan Scaling up plan Risks / mitigating plan
  13. 13. Team Team is fundamental to early stage venture, providing the best collateral for an investor  Track record  Coverage of skills – finance, technical, marketing, etc  Stock/compensation plan  Advisers, etc.
  14. 14. Financials Current / Projected for next 3 years When will it break even Self investment & funding received till date Investment sought Valuation expectation
  15. 15. Exit Building an exit option is necessary for yourself, your team, and your investors Investors will monetize their investment  How  When  What
  16. 16. And Finally Put some of your skin in the game Getting a high valuation early can be fatal Size of the pie wins every time over share of the pie Ideas are a dime a dozen, its execution, execution, execution !!
  17. 17. Thank you Do write in :