43. Venture Capital InvestmentsBy industry: Q2 2011 Visit www.pwcmoneytree.com for Industry definitions PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report based on data from Thomson Reuters 8
44. Venture Capital InvestmentsBy region: Q2 2011 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report based on data from Thomson Reuters Q2 2011 Total Investments - $7,516.1 million in 966 deals 9
45. Corporate Acquisitions Successful Exits Create Successful Entrepreneurs Cash of Top Consolidators $300+B Source: Capital IQ
111. Social: Disrupting the Internet Landscape WORLD WIDE SOCIAL NETWORK USERS (Billions) GLOBAL SOCIAL NETWORKS (~100M USERS) 100% 80% 60% 40% 20% 0% GENERAL % of Internet Users Social Network Users (B) NICHE GLOBAL REGIONAL Source: eMarketer and Sierra Ventures Portfolio Investment Opportunities
112.
113. Big Data and Analytics – Massive Scale in Real-time – Those who can leverage will win
114. Cloud - The New Data Center – ‘X-as-a-Service’ and at commodity prices
115. Mobility – The New Starting Point – consumerization sets the standard for access, simplicity and adoption
116. Social – The New Internet – the social chain as the new dimension across the globe
124. Sierra CIO Advisory Board Global IT Leaders -- Meet Monthly Technology Finance Telco / Media Consumer / Manufacturing / Industrial Retail / Hospitality Pharma/Health/Govt.
125. Sierra CIO Summit Enable Strategic Exchange of Best Practices for CIO Board Members Five Sierra “CIO Summits” held since 2006 – Each with a Major Keynote Marc Benioff CEO Eric Schmidt CEO Meg Whitman CEO Mark Hurd CEO Enrique Salem CEO Tom Siebel CEO Charles Phillips Co-President Joe Tucci CEO 34
126. Sierra Ventures Tracking: The Ripple Effect of Disruptions Social Cloud BigData Mobile Private Cloud Software Social Media Presence PredictiveAnalytics Mobile App Dev Platform
127. Recent Liquidity Events Greenplum purchased by EMC for $400M (closed 8/2010) American Fiber Systems purchased by Zayo Group for $115M (closed 9/2010) Simplify Media purchased by Google (closed 3/2010) MakeMyTrip.com completes $80M IPO (8/2010) CarWale purchased by Axel Springer (closed 12/2010) Makara purchased by Redhat (closed 11/2010) InvenSense files for $100M IPO led by Goldman and Morgan Stanley
128. Sierra Ventures Recent Investments Alpine Data Labs received $2.75M from Sierra (2/2011): San Mateo, CA Predictive Analytics model & score against all data DynamicOps received $7.975M from Sierra (2/2011): Burlington, MA Cloud automation - private cloud & VDI deployments Payvment received $4.5M from Sierra (11/2010): Palo AltoSocial network powered e-commerce platform Appcelerator received $6.5M from Sierra (10/2010): Mt. ViewMobile application cross-platform development solution Prelert received $1.25M from Sierra (8/2010): Framingham, MAIT incident and root cause analysis solution Runa received $3.75M from Sierra (7/2010): Mountain View, CAOnline conversion marketing solution
144. Summarize the current financing roundCompany Snapshot [1-2 slides] Simple single sentence overview of the company Snapshot Data Date of Incorporation Number of Employees Office Locations Total funds raised to Date Team [1-2 slides] Founders & Management Board of Directors/Board of Advisors Problem [1 slide] Describe the customer pain Describe how that pain is met today Total Addressable Market [1 slide] Calculate or provide third party research on the TAM (top down and bottoms up) Solution [open] Explain your Company’s value proposition in order to solve the problem described in the previous “Problem” slide Describe the Product (functionality, features, architecture, what core IP do you have). Show your Product development roadmap Provide use cases (or customer case studies if appropriate)
145. Steps Who to pursue – do your diligence Crunchbase, PEHub, VentureBeat, VC sites, VC FB/Twitter Introduction Work your network – Paragraph from your ‘recommender’ Pre-View Call Likely a phone call – Ask questions – Have examples Know their background Enable possible next steps – “We wont begin fundraising until... “ First Meeting Investor Deck – Team, Traction, Technology Build your advocate – what’s their outcome goal Partner Meeting Mixed Audience – do your homework Predefine an outcome – to move to due diligence calls (have some done already) Due Diligence Your contacts .... And those you don’t know. (help make it simple) Term Sheet Study the terms early – How competitive is the deal
146. Due Diligence Effort Tab 1 Executive Summary/Business Plan Tab 2 Investor Presentation Tab 3 Sales & Market Briefing Tab 4 Product Information Tab 5 Technology Information Tab 6 Competitive analysis Tab 7 Operations - Engineering Schedule/Manuf process/Quality Metrics Tab 8 Financials Tab 9 Customer references Tab 10 Future product roadmap(go over new products, what’s exciting..) Tab 11 Valuation & Exit Analysis Tab 12 Management Bios & References Tab 13 Cap Tables & Term Sheets Tab 14 Patents & Applications (patent review – what’s defendable?) Tab 15 Market research, white papers, news articles, etc. Tab 16 Misc. emails, etc.
147. Funding and Rounds Funding Expectations: $10M company or $200M+... Less is More: Raise what you need – Milestones support valuation Preferred = Risk Founder: 1-4 (2 equal partners ideal) Convertible Debt (Bridge Loan) at 20% discount to next round Venture Debt: too early must be collateralized, venture debt generally 20-30% of last round, Servicing the debt with Capital OK, warrants nominal, Prime+1.5pts Employee Option Pool: 20% CxO Hires: CEO 5-7%, COO 2-3%, VPS/VPE/VPM ~1½%