1. Startup by Numbers Jeff Clavier Managing Partner, SoftTech VC Startup by Numbers 7/14/11
2. Short Intro Jeff Clavier (@jeff) French C/C++ & Distributed Computing Hacking Financial Services startup in 1989 “Traditional” VC in the Valley since 2000 Web 2.0 Investing Angel since ’04 Super Angel since ‘07 Micro VC since ‘11 SoftTech VC (@softtechvc) 7 years old 3 funds (‘04, ‘07, ‘11) 104 investments 18 exits 50+ follow-on rounds > $600M raised Deploying Fund III $35M 16 deals Startup by Numbers 7/14/11
3. A few SoftTech exits 7/14/11 Startup by Numbers SoftTech VC I SoftTech VC II Acquired by Acquired by Acquired by Acquired by Acquired by Acquired by Dec 05 Aug 06 Dec 06 May 10 Dec 09 May 09 Acquired by Acquired by Acquired by Acquired by Acquired by Aug 07 Aug 07 Dec 09 July 10 July 10 Acquired by Sept 10 Acquired by July 10 Acquired by Dec 10 Acquired by Apr 11
4. 7/14/11 Startup by Numbers SoftTech VC III –(Partial) Deals Social Media, Real-time Web & Commerce Gaming “New” Areas Mobile Services & Infrastructure Search, Local & Monetization (Cloud) Services & Infrastructure Services
7. Fair Warning All this BS varies vastly from one startup to the next Experience based on a sample of a few thousand Silicon Valley consumer internet startups My Anti-Portfolio will show you how much of a total idiot I am Your Canadian mileage may vary if you follow these advice Startup by Numbers 7/14/11
14. The Awesome Combo Startup by Numbers Ariel Seidman, CEO D = Distribution Can Market, Sell, Lead Matt Crampton, CTO D = Development Can Build, Scale, Fix David Watanabe D = Design Awesome UI/UX Guru D D D 7/14/11
19. More?A: ≥ 1 and ≤ 4 Need to cover the 3 D’s And then some Co-founders join pre-funding, afterwards they are employees Equity is not always equally distributed Startup by Numbers 7/14/11
20. How Do I Evaluate Startups? Startup by Numbers 7/14/11
21. How Do I Evaluate Startups? Startup by Numbers 7/14/11
22. Introducing the 3-asses rule Startup by Numbers A Smart-ass team Building A Kick-ass Product In a Big-ass Market 7/14/11
26. How Much Money to Raise? 7/14/11 Startup by Numbers How much do you want to burn?
27. How Much Money to Raise? Funding Phase Bootstrap: 0 - $100K+ As long as you can Seed: $500K - $1.5M 12-18 mths Series A: $3-$5M 2 years Series B: $8-$15M Startup by Numbers 7/14/11
28. How Much Money to Raise? Funding Phase Bootstrap: 0 - $100K+ As long as you can Seed: $500K - $1.5M 12-18 mths Series A: $3-$5M 2 years Series B: $8-$15M Expenses Back-end, Offices Few small salaries All-in: $30 to $50K/mth Before PMF < $30K People, Marketing, Infra Startup by Numbers 7/14/11
30. At Which Founder Dilution? Bootstrap Incubators: 5% to 10% Seed Option Pool: 10 to 20% Round: 20 to 25% Series A Round: 20 to 25% Startup by Numbers 7/14/11
37. How Many ___ to Get Funding Startup by Numbers 7/14/11
38. How Many Slides in My Deck 10-12 main slides 0-10 backups Be ready to go linear or jump back/forth Don’t read/engage Key points: Which Problem Why Why you Why now How Who else How much/long What for 7/14/11 Startup by Numbers
39. How ManySeed Investors? Find a (strong) lead Expertise, Passion, Time, Rollodex Syndication Footprint Typical seed round (5 to 15 in cap table) One to Three uVCs One traditional VC if you really want to Helpful angels Bonus tip: Due your own Due Diligence FFS! 7/14/11 Startup by Numbers
40. How Many Funds to Talk To? Do your homework: Fund/Angel targets No competitors! For each target, find trusted connection You’ll need: intro paragraph, investor deck, reference list Ask for help: friends, mentors, former colleagues, CEOs My Answer: Pre-Marketing: 5 Fund Raising: rolling 10, out of your list of 20/25 suspects Startup by Numbers 7/14/11
42. How Much does Raising Cost? Seed: $5K for incorporation and convertible note $20/30K for equity round Other rounds: $30/50K and up ALWAYS USE A FUCKING LAWYER FIXING AN EARLY STUPID MISTAKE MAY COST MILLIONS Startup by Numbers 7/14/11
43. How Do I Measure Progress? Define key metrics Establish goals Implement dashboard Make one or two key metrics available to everyone in the company Key: Cohort Analysis Key: Cohort Analysis Key: Cohort Analysis Key: Cohort Analysis Key: Cohort Analysis Key: Cohort Analysis Key: Cohort Analysis Key: Cohort Analysis Key: Cohort Analysis Startup by Numbers 7/14/11
44. How Do I See It’s Not Working? Startup by Numbers 7/14/11
45. How Do I Know It Won’t Work? Startup by Numbers 7/14/11
