DETAILS of THE SEMINAR: Title: ACCELMED WEBINAR "Approaching Investors" Time: 29/7/2014 - 14.30 to 15.30 Trainer: Francesco Inguscio, Nuvolab srl Objective: The webinar on "Approaching investors"will help start-ups understand the process to fund a new company, identify different funding possibilities and know about process and tacite rules to approach and negociate a deal with an investor. Contents: - Overview - An inconvenient truth - Finding funding: different sources - How to approach investors - Conclusions Francesco Inguscio - Bio Francesco Inguscio is CEO and founder of Nuvolab, one of the main venture accelerator for startups in Italy. In 2010 he worked for M31, one of the most important business incubator in Italy as Business Development Director of its Silicon Valley branch, M31 USA. Formerly, he has been working both for the US Market Access of San Jose, a first rate international start-ups incubator in Silicon Valley, as business developer, and for the Angels’ Forum of Palo Alto, a leading business angel network in California, as financial analyst. In March 2010 he was awarded with his team of VRMedia, at Stanford University, with the Mind The Bridge prize, as the most innovative high tech startup in Italy. Previously, among others, he succeeded in working as research fellow in School of Advanced Studies Sant’Anna of Pisa (2009); as analyst IBM Global Business Services (2008) on market planning and IP management projects; as business strategy analyst in Accenture Business Consulting (2006), where he was involved in several projects concerning marketing and strategy analysis for the banking & insurance industry, and in the development of new financial products; he also worked in Prometeia (2005), a financial firm where he supported the development of innovative financial products and the creation of risk management tools for the banking industry. Francesco earned a BA in Management & Finance magna cum laude in 2003 and a MA in Finance magna cum laude in 2005, both from the University of Padova. In 2008, he got a Master in Innovation Management cum laude at the School Sant’Anna of Pisa. Currently; in 2010 he earned a Certificate in Technology Entrepreneurship at the Santa Clara University (CA), supported by the Fulbright BEST Program Grant.

1. APPROACHING
INVESTORS
Accelmed
Accelera6on
Programme
July
29
2014

2. Summary
¨ Overview
¨ An
inconvenient
truth
¨ Finding
funding:
different
sources
¨ How
to
approach
investors
¨ Conclusions

3. Nuvolab
is
a
business
accelerator
and
a
catalyst
of
change
dedicated
to
all
the
reali=es
in
the
(Italian)
entrepreneurial
ecosystem.
What
is
Nuvolab?

4. What
is
a
startup?

5. What
is
a
startup?
An
innova=ve
company

6. A
startup
is
temporary
organiza6on
in
search
of
a
repeatable,
scalable
business
model
(Steve
Blank,
The
Startup
Owner’s
Manual)
1. Temporary
organiza6on
2. In
search
3. Of
a
business
model
4. Repeatable
5. Scalable
A
good
defini6on

7. A
startup
has
a
well
defined
lifecycle
that
ends
with
the
valida=on
of
its
(repeatable
and
scalable)
business
model.
Done
that,
it
becomes
a
real
“company”.
It’s
a
journey.
Temporary
organiza6on…

8. A
startup
is
a
“?”
and
not
a
“!”
(more
appropriate
for
successful
company)
beside
the
word
“business
model”.
Credits:
Steve
Blank,
The
Startup
Owner’s
Manual
Credits:
Eric
Ries,
The
Lean
Startup
?
..in
search...

9. A
business
model
describes
the
ra=onale
of
“how
an
organiza+on
creates,
delivers,
and
captures
value”
(A.
Osterwalder,
2010).
In
other
words
is
about
how
a
firm
will
make
money
and
sustain
its
profit
stream
over
=me.
..of
a
business
model...

10. A
repeatable
business
model,
is
a
business
model,
which
will
generate
cash-­‐flow
more
than
once.
This
sounds
very
obvious,
because
as
it
seems
every
business
is
repeatable.
But
this
is
not
true.
When
you
sell
your
house:
this
is
not
a
repeatable
business
model.
But
of
course
it
is
a
repeatable
business
model
to
sell
houses
of
other
people.
Repeatability
of
your
business
model
is
strongly
related
to
a
specific
ques=on:
if
your
business
will
growth
or
not
in
the
future.
..repeatable...

11. Scalability
is
the
ability
of
a
system,
network,
or
process
to
handle
a
growing
amount
of
work
in
a
capable
manner
or
its
ability
to
be
enlarged
to
accommodate
that
growth.
Meaning
for
a
business:
when
your
revenues
grow,
your
profits
grow
(more
than)
propor=onally
(economy
of
scale).
Scalability
of
your
business
model
is
strongly
related
to
a
specific
ques=on:
how
your
business
will
growth
in
the
future.
..and
scalable!

12. • Not
every
(new)
company
is
a
(scalable)
startup.
• A
startup
is
not
a
younger/smaller
version
of
an
“old”
tradi=onal
company.
• Startup
(=“?”):
a
temporary
organiza=on
in
search
of
a
repeatable,
scalable
business
model
.
• Company
(=“!”):
a
permanent
organiza=on
designed
to
execute
a
repeatable
and
scalable
business
model
• So
startups
have
(some)
different
needs
compared
to
tradi=onal
companies
à
i.e.
financial
needs
and
funding
sources:
– Since
they
need
=me
(and
money)
in
order
to
find
an
answer
about
their
business
model
(“?”)
à
specific
funding
needs
(especially
when
their
business
is
capital
intensive)
– Since
they
are
high-­‐poten=al
(scalable)
companies
(“!”)
à
specific
(some6me
exclusive)
sources
of
finding
/
investors
So
what?

13. The
startup
journey:
a
lifecycle
perspec6ve
(metaphor)

14. The
startup
journey:
a
lifecycle
perspec6ve
(metaphor)

15. STAGE 1 STAGE 2 STAGE 3
CONSERVATION
SUSTAIN
SCALE
EFFICIENCY
VALIDATION
DISCOVERY
IDEA
STAGE 4 STAGE 5 STAGE 6 STAGE 7
REVENUES
TIME
Start
Launch
Build
Chasm
Scale
Maturity
Source:
Four
Step
To
Epiphany
(S.
Blank),
Startup
Compass
(Stanford)
e
Startup
Lifecycle
(F.
Des=n)
The
startup
journey:
a
lifecycle
perspec6ve
(product
PoV)

16. Summary
¨ Overview
¨ An
inconvenient
truth
¨ Finding
funding:
different
sources
¨ How
to
approach
investors
¨ Conclusions

17. STAGE 1 STAGE 2 STAGE 3
CONSERVATION
SUSTAIN
SCALE
EFFICIENCY
VALIDATION
DISCOVERY
IDEA
STAGE 4 STAGE 5 STAGE 6 STAGE 7
REVENUES
TIME
Start
Launch
Build
Chasm
Scale
Maturity
Source:
Four
Step
To
Epiphany
(S.
Blank),
Startup
Compass
(Stanford)
e
Startup
Lifecycle
(F.
Des=n)
Startup
lifecycle:
take
the
product
PoV..

18. FINANCIAL
NEEDS
7
STAGES
CASH
FLOW
EXPANSION MATURITY
Financial
needs
Revenues
Cumula6ve
cash
flow
..and
combine
it
with
the
financial
PoV..

19. FINANCIAL
NEEDS
7
STAGES
CASH
FLOW
EXPANSION MATURITY
Financial
needs
Revenues
Cumula6ve
cash
flow
..where
the
financial
need
is
evident!

20. FASE 1 FASE 2 FASE 3
CONSERVATION
SUSTAIN
SCALE
EFFICIENCY
VALIDATION
DISCOVERY
IDEA
FASE 4 FASE 5 FASE 6 FASE 7
Note:
overlapping
product
and
financial
perspec=ve
has
only
didac=c
purpose
FINANCIAL
NEEDS
7
STAGES
CASH
FLOW
EXPANSION MATURITY
Financial
needs
Revenues
Cumula6ve
cash
flow
Start
Launch
Build
Chasm
Scale
Maturity
It
will
persist
6ll
your
business
model
is
validated
or..

21. FINANCIAL
NEEDS
7
STAGES
CASH
FLOW
EXPANSION MATURITY
Financial
needs
Revenues
Cumula6ve
cash
flow
“The
valley
of
death”
..6ll
you
will
exit
from
the
market
prematurely

22. Source:
The
Illusions
of
Entrepreneurship:
The
Costly
Myths
that
Entrepreneurs,
Investors,
and
Policy
Makers
Live
By
HBS
(2011):
• Failure
=
liquida=ng
all
assets,
with
investors
losing
most
or
all
the
money
they
put
into
the
company
à
the
failure
rate
for
start-­‐ups
is
30-­‐40%.
• Failure
=
failing
to
see
the
projected
return
on
investment
à
failure
rate
is
70-­‐80%.
• Failure
=
declaring
a
projec6on
and
then
falling
short
of
mee=ng
it
à
failure
rate
is
a
whopping
90-­‐95%.
Classic
company
Tech
Startup
The
Valley
of
Death

23. Failure
rate
by
industry

24. 6 Copyright © 2011 Nuvolab - All Rights Reserved
Fonte: http://www.chubbybrain.com/blog/top-reasons-
startups-fail-analyzing-startup-failure-post-mortem/
Le 20 principali cause di “morte prematura” per una
startup (secondo ChubbyBrain, database VC e BA)
Source:
h_p://www.chubbybrain.com/blog/top-­‐reasons-­‐
startups-­‐fail-­‐analyzing-­‐startup-­‐failure-­‐post-­‐mortem/
The
top
20
Reasons
Startups
Fail

25. 1.
Being
inflexible
and
not
ac=vely
seeking
or
using
customer
feedback
à
45%
2.
Building
a
solu=on
looking
for
a
problem,
i.e.,
not
targe=ng
a
“market
need”
à
30%
3.
Not
the
right
team
à
30%
4.
Poor
Marke=ng
à
28%
5.
Ran
out
of
cash
à
25%
6.
I
got
this
product.
Now
I
just
need
a
business
model
à
25%
7.
Release
product
at
the
wrong
=me
à
20%
8.
Lack
Passion
and
Exper=se
à
19%
9.
Do
not
cut
your
losses
a
la
Pivot
at
the
right
=me
à
19%
10.
A
“User
Un-­‐Friendly”
Product
à16%
11.
Pricing
Issues
à
16%
12.
Do
not
use
your
connec=ons
à
16%
13.
Disharmony
with
Investors/Co-­‐
founders
à
12%
14.
Lose
Focus
–
Distracted
by
Shiny
Objects
à
12%
15.
Burn
Out
à
12%
16.
Get
outcompeted
à
10%
17.
Be
unable
to
A_ract
Investors
à
6%
18.
Loca=on,
Loca=on,
Loca=on
à
6%
19.
Not
working
on
it
full
=me
à
6%
20.
Start
the
company
at
the
wrong
=me
à
6%
The
top
20
Reasons
Startups
Fail

26. So..
Startup
life
is
a
very
hard
thing!

27. SMART
MONEY
Competences
Funding
What
is
missing?

28. Verve
Capital
Partners
(2011):
what
is
the
VC
spent
per
capita
in
European
countries
(USA
$
67
pc)
à
5
groups
• Group
1
($70-­‐60):
Switzerland
($69
pc),
the
Netherlands
($
62
pc)
• Group
2
($60-­‐50):
Sweden,
Finland
($
59
pc),
Denmark
($
53
pc)…
over
European
average
($
35
pc).
• Group
3
($40-­‐30):
UK,
Ireland
($39
pc),
Belgium
($33
pc),
France
($31
pc)
• Group
4
($30-­‐20):
Norway
($27
pc)
Spain
($24
pc),
Germany
($21
pc)
• Group
5
($10-­‐0):
Austria
($10
pc),
Portugal
($
7
pc),
Greece
($
3
pc)
and…last…
Italy
($
1
pc)
An
inconvenient
truth

29. Summary
¨ Overview
¨ An
inconvenient
truth
¨ Finding
funding:
different
sources
¨ How
to
approach
investors
¨ Conclusions

30. h_p://www.youtube.com/watch?v=U470xXKfDyE
Let’s
start
with
a
brief
overview
(by
Kauffman
Founda6on)

31. “3
F”
BA
VC/CV
IPO
FINANCIAL
NEEDS
7
STAGES
CASH
FLOW
EXPANSION MATURITY
Financial
needs
Revenues
Cumula6ve
cash
flow
Grant
Customers
Crowdfunding
Prizes
Funding
your
startup:
(un)conven6onal
sources

32. Founders
(and
their
bank
accounts)
Customers
Friends
&
Family
(&
Fools)
Business
angels
Venture
Capital
Corporate
Venture
Crowdfunding
Seed
accelerator
programmes
Business
incubators
Public
grants
Prizes
Funding
sources:
short
list

33. • Where
to
spend
– Team!
Engineers,
Product
Management
– Product
&
usability
– Good
lawyers
• Where
NOT
to
spend:
– Big
management
teams
– Marke=ng
&
adver=sing
– Big
outsourcing
projects
– Bonuses
(with
some
excep=ons…)
– Travel
(again,
with
some
excep=ons…)
– Outside
sales
forces
• Common
spending
pitalls
– Hiring
too
many
people
– Hiring
the
wrong
people
– Doing
too
many
things
– Goldpla=ng
– Not
geung
short-­‐term,
hard
returns
Especially
when
is
your
money:
cash
is
king
so..

34. Financing
growth
from
previous
cashflow
and
personal
fund
(obviously
need
to
have
cashflows
J)
Most
good
bootstrapped
companies
emerge
from
a
service
or
consul=ng
companies
that
are
“produc=sing”
their
offering
Pros
– Bootstrapped
companies
almost
always
spend
cash
more
effec=vely
than
equity
financed
companies
– Already
being
close
to
exis=ng
customers,
give
excellent
ability
to
understand
problems
and
define
good
solu=ons
Cons
– Resources
for
product
and
market
dev
constrained
by
cashflows
– May
miss
a
big
opportunity
if
other
players
raise
finance
and
invest
heavily
Self
financing
/
bootstrapping

35. • Rela=vely
limited
funds
will
be
available
for
startup;
likely
to
want
collaterals
anyway
• Banks
only
lend
to
predictable
businesses
they
can
understand
(be_er
being
a
“!”
rather
than
a
“?”)
• If
your
capital
requirements
are
limited
and
your
business
is
following
a
well
trodden
path,
can
be
a
useful
source
of
finance
• Not
par=cularly
useful
web
or
high
growth
tech
industries
• Some
(public)
facilita=on
for
startups
in
some
Countries
à
i.e.
in
Italy
Fondo
di
Garanzia
will
provide
(innova=ve)
startups
with
a
(public)
collateral
on
80%
of
your
debt
up
to
€2,5M
(100+
startups
already
asked
for
it)
Debt/
bank
finance

36. Founders
(and
their
bank
accounts)
Customers
Friends
&
Family
(&
Fools)
Business
angels
Venture
Capital
Corporate
Venture
Crowdfunding
Seed
accelerator
programmes
Business
incubators
Public
grants
Prizes
Funding
sources:
short
list

37. • Not
all
startups
require
external
funding
• Cash
flow
comes
ul=mately
and
most
importantly
from
customers,
NOT
from
investors
• Bootstrapping
in
business
means
star=ng
a
business
without
external
help
or
capital.
Such
startups
fund
the
development
of
their
company
through
internal
cash
flow
and
are
cau=ous
with
their
expenses.
Generally
at
the
start
of
a
venture,
a
small
amount
of
money
will
be
set
aside
for
the
bootstrap
process
Customers
/
bootstrapping

38. Focus:
bootstrapping
h_p://bit.ly/bootstrapbible

39. Founders
(and
their
bank
accounts)
Customers
Friends
&
Family
(&
Fools)
Business
angels
Venture
Capital
Corporate
Venture
Crowdfunding
Seed
accelerator
programmes
Business
incubators
Public
grants
Prizes
Funding
sources:
short
list

40. 3F
(aka
“Love
Capital”)

41. Founders
(and
their
bank
accounts)
Customers
Friends
&
Family
(&
Fools)
Business
angels
Venture
Capital
Corporate
Venture
Crowdfunding
Seed
accelerator
programmes
Business
incubators
Public
grants
Prizes
Funding
sources:
short
list

42. • An
angel
investor
or
angel
(also
known
as
a
business
angel
or
informal
investor
or
angel
funder)
is
an
affluent
individual
who
provides
capital
for
a
business
start-­‐up,
usually
in
exchange
for
equity.
• A
small
but
increasing
number
of
angel
investors
organize
themselves
into
angel
groups
or
angel
networks
to
share
research
and
pool
their
investment
capital,
as
well
as
to
provide
advice
to
their
portolio
companies.
• Unlike
the
VC
the
Angel
invests
their
own
money
• Hands
on
approach:
geographical
or
industrial
“proximity”
• The
Angel
approach
is
to
invest
small
amounts
at
a
very
early
stage
/
low
valua=on
– €50-­‐€250k
at
valua=ons
of
€500k-­‐€4m
• Two
“exits”
for
angel
– Firm
might
be
sold
quickly
for
€5-­‐10m
or
less
where
the
Angel
can
make
2-­‐5x
money
– Firm
raises
VC
money,
ayer
which
Angel
typically
becomes
more
passive
but
has
built
up
exposure
very
cheaply
to
a
venture
backed
enterprise
• The
key
thing
when
selec=ng
an
Angel
therefore
is
whether
they
can
help
you
raise
VC
finance
– See
which
Angel
investors
have
invested
with
which
VCs
Business
angels

43. Digital
BAN
Business
Angels
Business
angels
(categories
with
Italian
examples)
Lone
Business
Angels
Regional
mul6sectoral
BAN
Na6onalwide
BAN
sectoral
focus
General
BAN

44. Example:
BAN
in
Italy
www.iban.it
Business
angels
(network):
map
www.eban.org

45. Founders
(and
their
bank
accounts)
Customers
Friends
&
Family
(&
Fools)
Business
angels
Venture
Capital
Corporate
Venture
Crowdfunding
Seed
accelerator
programmes
Business
incubators
Public
grants
Prizes
Funding
sources:
short
list

46. • A
venture
capital
fund
refers
to
a
pooled
investment
vehicle
that
primarily
invests
the
financial
capital
of
third-­‐party
investors
in
startup,
that
are
too
risky
for
the
standard
capital
markets
or
bank
loans.
• These
funds
are
typically
managed
by
a
venture
capital
firm,
which
oyen
employs
individuals
with
technology
backgrounds
(scien=sts,
researchers),
business
training
and/or
deep
industry
experience.
• Receive
1000s
of
business
plans
each
year
• Read
100s
of
plans
• Meet
with
dozens
of
companies
• Fund
a
handful
(1-­‐2%)
• Portolio
expecta=ons:
– 60%
die
or
go
nowhere
(living
dead)
– 30%
yield
2-­‐4x
in
4-­‐7
years
– 10%
(hopefully
20%)
are
tremendous
successes
(e.g.,
10x,
100x,
1000x!)
Venture
capital

47. The
Venture
Capital
inves6ng
process

48. Structure
of
a
(generic)
VC
fund

49. Example:
VCs
in
Italy
(Who
is
Who
map)
www.italiastartup.it
Venture
capital:
map
www.evca.eu

50. Founders
(and
their
bank
accounts)
Customers
Friends
&
Family
(&
Fools)
Business
angels
Venture
Capital
Corporate
Venture
Crowdfunding
Seed
accelerator
programmes
Business
incubators
Public
grants
Prizes
Funding
sources:
short
list

51. Corporate
Venture
Capital
Defini=on:
a
Venture
Capital
firm,
independent
or
cap=ve,
which
manages
at
least
on
VC
Fund
with
the
following
characteris=cs:
• A
Corporate
is
a
cornerstone
investor
in
the
VC
Fund
• The
firm
is
following
the
PE
model
(exit
strategy
and
mid
to
long
term
investment
horizon)
• The
VC
Fund
invests
mainly
in
companies
opera=ng
in
the
core
business
area
of
the
Corporate
• The
Venture
Capital
Firm
uses
extensively
the
experience,
technologies
and/or
market
contacts
of
the
Corporate
to
manage
the
portolio
of
the
VC
Fund
Source:
EVCA
(2013)

52. Corporate
VC
Investment
Source:
Boston
Consul=ng
Group
(2012)

53. Corporate
Venture
Capital:
map
by
deals

54. Founders
(and
their
bank
accounts)
Customers
Friends
&
Family
(&
Fools)
Business
angels
Venture
Capital
Corporate
Venture
Crowdfunding
Seed
accelerator
programmes
Business
incubators
Public
grants
Prizes
Funding
sources:
short
list

55. REWARD-­‐BASED
DONATION-­‐BASED
LENDING-­‐BASED
EQUITY-­‐BASED
CROWDFUNDING
MODELS
Logic:
Proponent
à
Idea
à
Crowd
à
Reward
Target:
crea=ve
projects
(music,
cinema,
design,
hardware,
etc.).
Examples:
KickStarter
(USA/UK)
/
Eppela
(ITA)
Logic:
Proponent
à
Cause
à
Crowd
à
Altruism
Target
:
social
/
cultural
ini=a=ves
(not
for
profit)
Examples:
Causes
(USA)
/
Rete
del
Dono
(ITA)
Logic:
Proponent
à
Financial
need
à
Crowd
à
Interests
Target:
consumer
finance
needs
Examples:
Zopa
(UK)
/
Pres=amoci
(ITA)
Logic:
Proponent
à
Financial
need
à
Crowd
à
Equity
Target:
startups
Examples:
AngeList
(USA)
/
GrowVC
(UK)
/
SiamoSoci
(ITA)
Crowdfunding
Crowdfunding
is
the
prac=ce
of
funding
a
project
or
venture
by
raising
monetary
contribu6ons
from
a
large
number
of
people,
typically
via
the
Internet.

56. • 453
ac=ve
platorms
(2012)
• 1
Million
project
funded
• $
0,89
Billion
raised
in
2010
• $1,47
Billion
raised
in
2011
• $2,66
Billion
raised
in
2012
• $5,1
Billion
raised
in
2013
(es=mate)
Source:
Google
Trends
-­‐
Search
Volume
Index:
“crowdfunding”
Crowdfunding
numbers
h_p://bit.ly/thecrowdfundingbible

57. Founders
(and
their
bank
accounts)
Customers
Friends
&
Family
(&
Fools)
Business
angels
Venture
Capital
Corporate
Venture
Crowdfunding
Seed
accelerator
programmes
Business
incubators
Public
grants
Prizes
Funding
sources:
short
list

58. • Seed
accelerators
are
fixed-­‐term,
cohort-­‐based
programs
aimed
at
developing
new
startups.
• The
accelerator
programmes
key
elements
are:
- Funding,
typically
to
the
seed
level
(<€40k)
vs
equity
(5-­‐10%)
- Company
founders
are
small
teams
(2-­‐3
people)
with
technical
backgrounds
- Each
cohort
is
supported
for
a
defined
period
of
6me
(3-­‐6
month)
- Educa6on
programme
focusing
on
business
advice
and
product
advice
- Networking
programme
to
meet
and/or
contact
other
investors
and
advisors
• Programmes
may
or
may
not
include:
– Office
space,
whether
free
or
subsidized
– A
Demo
Day
for
funded
companies
Seed
accelerator
programmes
Source:
Chris=ansen,
Jed
D.
Copying
Y
Combinator:
a
framework
for
developing
seed
accelerator
programmes.
Pre
L’accelerazione agisce quando
un’ idea, apportando in un pe
L’esperienza estera di acce
aumentare la crescita e le

59. Seed
accelerator
programmes
maps
www.startupfactories.eu
h_p://www.seed-­‐db.com/accelerators

60. Founders
(and
their
bank
accounts)
Customers
Friends
&
Family
(&
Fools)
Business
angels
Venture
Capital
Corporate
Venture
Crowdfunding
Seed
accelerator
programmes
Business
incubators
Public
grants
Prizes
Funding
sources:
short
list

61. Business
Incubators
• Business
incubators
are
private
or
public
organiza6on
specialized
in
crea6ng
and
suppor6ng
other
companies.
• According
to
NBIA
(USA
Na=onal
Business
Incuba=on
Associa=on)
there
are
10.000+
incubators
worldwide.
• Incubators
nurture
young
(startup)
firms
during
their
early
months
or
years,
by
usually
providing
them
with:
- affordable/shared
offices
and
G&A
services
- mentoring/hands-­‐on
management
training
/
networking
- Oyen
marke=ng
support,
access
to
some
form
of
financing

62. Founders
(and
their
bank
accounts)
Customers
Friends
&
Family
(&
Fools)
Business
angels
Venture
Capital
Corporate
Venture
Crowdfunding
Seed
accelerator
programmes
Business
incubators
Public
grants
Prizes
Funding
sources:
short
list

63. Public
Grants
• Grants
are
non-­‐repayable
funds
disbursed
by
one
party
(grant
makers),
oyen
a
government
department,
corpora6on,
founda6on
or
trust,
to
a
recipient,
oyen
(but
not
always)
a
nonprofit
en=ty,
educa=onal
ins=tu=on,
business
or
an
individual.
• For
example,
the
European
Commission
provides
financing
through
numerous
specific
calls
for
project
proposals.
These
may
be
within
Framework
Programmes.
FP8
à
Horizon
2020:
the
programme
runs
from
2014
–2020
and
provides
an
es=mated
€80
billion
of
funding.
• Although
there
are
many
7
year
programmes
that
are
renewed
that
provide
money
for
various
purposes.
• There
are
also
occasional
one
off
grants
to
deal
with
unforeseen
aspects
or
special
projects
and
themes.
Most
of
these
are
administered
through
what
are
called
Na=onal
Agencies,
but
some
are
administered
directly
through
the
EU
Commission
in
Brussels.

64. Founders
(and
their
bank
accounts)
Customers
Friends
&
Family
(&
Fools)
Business
angels
Venture
Capital
Corporate
Venture
Crowdfunding
Seed
accelerator
programmes
Business
incubators
Public
grants
Prizes
Funding
sources:
short
list

65. Prizes
• There
are
a
lot
of
different
ini=a=ves
worldwide
aimed
at
suppor=ng
/
celebra=ng
/
funding
brilliant
business
ideas
and
high-­‐poten=al
startups.
• There
are
hundreds
startup/business
plan
compe==ons
running
in
Europe,
promoted
by
public
organiza=ons,
corpora=ons,
founda=ons
and
so
on.
• They
can
provide
you
with
network,
coaching,
visibility,
“in
kind”
prizes
and..
some=me
money!

66. Summary
¨ Overview
¨ An
inconvenient
truth
¨ Finding
funding:
different
sources
¨ How
to
approach
investors
¨ Conclusions

67. • Network
to
gains
access
to
VCs
• Don’t
get
hung-­‐up
on
confiden=ality
• Be
persistent
• Be
humble
yet
confident,
and
always
courteous
and
professional
• Embrace
and
learn
from
rejec=on
• Be
greedy
in
the
long-­‐run
(any
%
of
something
>
100%
of
nothing!)
How
to
approach
investors

68. Large
Poten6al
Market
Opportunity
Unique
Product
Or
Concept
Passionate
Founding
Team
Pre-­‐requisites
Intense
compe66on
likely
Need
to
move
rapidly
Implica6ons…
Hiring
Infrastructure
VC
funding
supports
Rapid
Product
Development
Interna6onalisa6on
Partnerships
Commercialisa6on
Good
reasons
to
raise
equity
finance

69. Applica6on
is
a
feature
not
a
product
Market
size
is
too
small
Motivation is
not financial
Risk
is
not
that
you
waste
=me
unsuccessfully
trying
to
raise
finance
…
…
real
danger
is
that
you
do
succeed
in
raising
VC
funds
– Lose
opportunity
for
small
exit
which
could
be
personally
lucra=ve
– Lose
opportunity
to
run
lifestyle
business
– Get
bound
in
to
3+
yrs
work
you
may
not
enjoy
When
NOT
to
raise
VC

70. Technology
Trac6on
• Can
evaluate
each
as
– Excep=onal
– Good
/
credible
– Mediocre
/
incomplete
• Misconcep=on
that
being
good
/
credible
across
the
board
is
what
VCs
look
for
– Can
always
add
credible
a_ributes
to
the
mix
later
• VCs
focus
on
finding
opportuni=es
which
rate
as
excep=onal
in
one
a_ribute
Team
What
does
an
investor
look
for

71. Has
funds
to
invest
Match
of
Size/Stage/
Geography
Relevant
Portolio
No
directly
compe66ve
investments
Excellent
track
record
Shortlist
• Do
create
a
shortlist
• Rifle
is
a
be_er
weapon
than
a
shotgun
• Similar
process
for
iden=fying
angels,
look
at
VC
funding
press
releases
to
iden=fy
prior
Angel
investors
Iden6fy
relevant
VC
partners

72. • Out
of
the
blue
email
is
a
long
shot
• Try
to
build
context
– Analyse
portolio
companies
–
are
there
any
links
there?
– Analyse
contact
network
and
advisors
– Analyse
press
coverage
– Par=cipate
in
blog
conversa=ons
– A_end
events
and
conferences
– Relevant
PR
around
product
also
helps
• VCs
spend
their
=me
looking
for
businesses
with
momentum
Geung
on
radar
screens

73. Useful
sources
of
informa6on
and
inspira6on
h_p://fundersandfounders.com
h_ps://www.techcrunch.com
h_p://startupdigest.com/

74. Summary
¨ Overview
¨ An
inconvenient
truth
¨ Finding
funding:
different
sources
¨ How
to
approach
investors
¨ Conclusions

75. Crisis:
risk
or
opportunity?

76. …half
empty,
half
full..
It’s
just
a
maver
of
point
of
view
(and
awareness).
(At
least)
now
you
know
where
is
the
liquid(ity)!
Conclusions

77. Thanks
for
your
6me
&
aven6on
@francingu
@nuvolab
francesco.inguscio@nuvolab.com
www.nuvolab.com ivysoul2000
Ref:
Francesco
Inguscio

78. Summary
¨ Overview
¨ An
inconvenient
truth
¨ Finding
funding:
different
sources
¨ How
to
approach
investors
¨ Conclusions
¨ (Hidden)
bonus
track:
startup
pitch

79. • Pitch:
What?
• Pitch:
Why?
• Pitch:
For
whom?
• Pitch:
How?
• Pitch:
some
examples
à
h_p://www.pitchenvy.com
Introduc6on

80. Overview
• Problem
• Solu=on
• Team
• Achievements
• Market
• Compe==on
• Business
model
• Economics
• Investment
proposi=on

81. Problem
• Analysis
of
exis6ng
and
emergent
customer
needs;
• Analysis
of
exis6ng
solu6ons
and
their
weaknesses.

82. Solu6on
/
Value
Proposi6on
• Descrip=on
of
the
offering
(product
features/
value
proposi=on)
• Descrip=on
of
benefits
provided
and
problems
solved
• Descrip=on
of
sustainable
compe==ve
advantages
(in
terms
of
technology,
product
features
and
market
needs)
• If
it
is
possible,
show
a
product
image
or
provide
examples

83. Team
• Name,
posi=on
• Relevant
experience
(max
2
raws)
• Name,
posi=on
• Relevant
experience
(max
2
raws)
• Organisa=onal
chart
• Cap
Table
(%
equity
stake)

84. Achievements
• Product
development
milestones
• Incorpora=on
date
• Personnel
• Revenues
• Metrics
(web/mobile)
• Main
customers
• Partnerships
• Funding
from
founders
and
funders
• Patents
and
trademarks
• Compe66ve
advantages
achieved

85. Market
• Iden=fica=on
of
target
market
and
of
relevant
segments
• Size
(in
terms
of
€/$
and
number
of
poten=al
customers)
• Growth
rate
(%)

86. Compe66on
• Main
compe6tors;
• Main
market
dynamics;
• Main
bases
of
compe66on;
• Compe66ve
benchmarking.

87. • What
is
your
business
model?
(How
do
you
make
money?)
• Highlights
on
sourcing,
produc=on
and
go-­‐to-­‐market
strategy
• Posi6oning
vis-­‐à-­‐vis
compe==on
(in
terms
of
product
features,
price,
clients,
channels)
Business
Model

88. Economics
€
(Euro)
2012
2013
(E)
2014
(E)
2015
(E)
2016
(E)
2017
(E)
Revenues
Personnel
cost
Marke=ng
Other
OPEX
EBITDA
EBIT

89. Investment
proposi6on
• What
is
your
financial
need?
What
do
you
exactly
want
from
your
investor?
Is
there
any
chance
for
a
co-­‐investment?
With
whom?
• Use
of
Proceeds
(how
are
you
going
to
allocate
new
funds?)
• Ac=vity
1
(%)
• Ac=vity
2
(%)
• Ac=vity
3
(%)
• Possible
Exit
(op+onal)

90. Contact
name
E-­‐mail
Mobile
phone
number
Website
Contacts

91. Pitch
Examples
(see
www.pitchenvy.com)
AirBnB
Mint
(Intuit
$170m)
Square