Tsh masterclass you've got seed... now what?


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• What does a Series A mean? It is your first round with professional investors, with true financial targets and commitments.
• How to get from seed to A: deliver an MVP, build out your team and get customer traction
o MVP: the core of your business to prove the business
o Committed team: working together full-time and covering the key bases of the business
o Product/Market Fit: proving that you have built something that target clients will pay at a commercially viable rate
• When do you need Series A
o When you have proved the above
o 3-6 months before you need the money
o When you need to get to the next level
• Investors matter
o Money isn’t money... remember that you will be in a close relationship with these investors for years! They should be a resource to help grow your business. They should be people that you would really like to work with!
o They will generally follow-up in subsequent funding rounds and will have influence over your future equity
• Start early- start to casually network and pitch 3-6 months ahead of time. Investors will want loads of data, but try not to let it distract you from running your business (consider doing this ahead of time or appointing someone to focus on this)
• Build a relationship- have trust for the road ahead & understand their firm (their investment thesis)
• When pitching, be UNIQUE and put the vision in context of your competitors
• Agree on milestones with your investors early. This is important to align the vision of success and motivate the team. Less direct milestones might be of equal importance. Examples can include: user conversion/engagement rates, team & product development.
• You have series A- now what?
o Know your runway- how much time do you have before you need to fundraise?
o Start investing to grow the business
o Communicate the milestones that you agreed with your investors with your team
 Set a communication schedule and keep to it
 Communicate loads!
o Think about your own role (will you be the person who will lead the company into series B and beyond, or should you start specializing?)
o In your board meetings, use it as a working session to problem solve and automate your data so that you don’t spend too much time generating data just before the meeting
• After Series A, B/C is for expansion and team building, C/D/later is growth including expanding to new locales, product lines, etc.

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Tsh masterclass you've got seed... now what?

  1. 1. You’ve got seedfunding…Now what? Ryan Kiskis January 2012
  2. 2. Who am I?VP Product at BaseKitInternet entrepreneur from California(Maybe too) often fundraiser
  3. 3. Why am I here?Series  C   $5M   Apr  ‘04   Seed   $50k   Sep  ’07   Series  A   $2.6M   Apr  ‘10  Series  D   $5M   Oct  ‘05   Seed  II   $500k   Apr  ‘08   Series  B   $6.5M   Apr  ‘11   Sale   $102M   Apr  ‘06   Series  A   $1.7M   Sep  ‘08   Series  B   $6.5M   Jun  ‘10   Fundraising 1.2 times per year, plus many more as advisor
  4. 4. What will Series A mean?First round with professional investorsTrue financial targets and commitmentsRelationship that will last years
  5. 5. How to get from Seed to AMinimum Viable ProductCommitted teamProduct/Market Fit (Traction)All within your runway
  6. 6. Minimum Viable ProductThe core pieces to prove your businessXfire: an IM that shows me what game my friends are inMartini: 10 network sites and 2 advertising clientsBaseKit: Massive array of design controls; limited UXRun this over and over again for each new development
  7. 7. Committed TeamWorked together, in this full timeCover the key bases of the businesses
  8. 8. Product/Market FitProven that you have built something that your target clients will pay for at commercially viable rate
  9. 9. So when do you need Series A?When you’ve proved the aboveWhen you need money (actually, before)When you need to get to the next level
  10. 10. Investors matterTempting to think money is moneyExits now are often 5-7 years or moreYou interact with investors every week
  11. 11. They’re going to be following up
  12. 12. And they will have influence Founder  1   Founder  2   Seed   Founder  1   Investor  1   Founder  2   Investor  2   Seed   Employee  After Series C funding, investors collectively own 55% ofthe company vs founders each having 13%
  13. 13. Some things to think aboutTimingPortfolioRelationshipStoryMilestones
  14. 14. Start Early3-6 monthsLots of networking as much as pitchingDon’t let data swamp you
  15. 15. PortfolioFind a firm who might actually investUnderstand their thesis or themeLook for competitors!
  16. 16. Build a relationshipHave trust for the road aheadUnderstand their firmFundraise in 48 hours
  17. 17. The storyVC partners see over 1000 plans a yearBe unique – not just a twistPut the vision in context
  18. 18. Agree on milestonesDo it early!Your success rides on themGreat motivators
  19. 19. Agree on milestonesUser counts, revenue, “traction”User conversion/engagement ratesTeam & product development
  20. 20. A – Now what?Know your runwayStart investingCommunicate
  21. 21. Team ManagementProbably need to expandEmphasize the upcoming goalsThink about your own role(s)
  22. 22. CommunicationMight be first time formally reportingSet a schedule and keep to itCommunicate, communicate, communicate
  23. 23. Board MeetingsGet to the point conciselyUse it as a working sessionAutomate your data
  24. 24. YMMV but…Seed: Provide minimum viable product & market fitA: Prove traction. You have customers beyond those you can touchB/C: Expansion. You’re building a team, facing scalingC/D/later: Growth. You’ve got a good business and may be going to new locales, opening new product lines
  25. 25. Good luck!Ryan Kiskisryan.kiskis@gmail.com@ryankiskisuk.linkedin.com/in/ryankiskis