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The Founder Institute May 23, 2012 Presented By: Jeff Stewart
money last?
What are the stages in a typical funding lifecycle? What are the milestones and expectations?
Value
First Paying Customer Full-Time Team Fully Vetted Initial Idea
Functional Product
Time
Value
First Paying Customer Full-Time Team Fully Vetted Initial Idea
Time
Value
Functional Product First Paying Customer Full-Time Team Fully Vetted Initial Idea
Good Investors can: Provide outside perspective Give you a dry run for a sale Introduce key hires Lend Credibility Provide Cash Introduce Customers Introduce Exit Opportunities Increase Exit Valuations
Time
Value
Functional Product
First Paying Customer Full-Time Team Fully Vetted Initial Idea
Time
Value
First Paying Customer Full-Time Team Fully Vetted Initial Idea
Functional Product
Time
Dont Run out of Money The rule of 2x3 It will take either twice as long and cost three times as much or it will take three times as long and cost twice as much You cant choose or predict which it will be! Be very frugal, make every penny count Dont be too frugal, know where to invest Dont Run out of Money
Remember!
There are plenty of investors that want to invest. Good teams with good business models will get funded
Joseph Bartlett - 1994
6.
7. 8. 9.
Amount
$ $ $ $ $ $ $ $ $ $ 25,000 100,000 100,000 50,000 25,000 100,000 75,000 25,000 250,000 50,000
Expect
$ $ $ $ $ $ $ $ $ $ $ 1,250 30,000 30,000 40,000 25,000 30,000 67,500 7,500 50,000 1,000 282,250
Notes
in Aspen till June Passed Reviewing Commited Meet Friday
Follow Up
*Data courtesy of Cooley Godward Kronish, based on their internal deal flow
*Data courtesy of Cooley Godward Kronish, based on their internal deal flow
The right investors should save you time, not cost you time
The wrong investors can kill your business The wrong terms can kill your business
Time is your most precious resource having useful investors is an investment of your time
Beware Evil
Have Fun
Protect and Inform your existing investors Understand Blue Sky Laws The right Attorney can help Think International Tour NY, then Boston, then Silicon Valley Include both East and West coast Angels Go big, or go home!