Description about Grow VC Group, crowd investing and p2p finance, and how to manage global de-centralized organization and keep people motivated. Also some points about business vs military strategy.

1. From startup crowdfunding to finance sector disruption
Aalto University
April 29, 2014 –Jouko Ahvenainen
Grow VC Group ++
www.growvc.com ++
@growvc ++
MARKETS – ASSETS – CROWD ++
Copyrights © Grow VC Group 2014

2. Copyrights © Grow VC Group 2014
Jouko Ahvenainen ++
Corporates: Entrepreneur:
Other Activities:
Transatlantic
Economic
Council
TOP 100
TOP 15

3. Finance and Services Infrastructure Consulting &
Professional Services
Grow VC Group ++
Copyrights © Grow VC Group 2014
Hong Kong - London - New York - San Francisco - Sao Paolo
The Grow VC Group is a worldwide pioneer and leader in the crowd investing,
peer-to-peer and online investment market.

4. Copyrights © Grow VC Group 2014
Market places in our portfolio ++

5. Copyrights © Grow VC Group 2014
#1 market place infrastructure ++
Technical platform, services like investor background check, investment escrow accounts,
due diligence services, credit check, transaction settlement, investor communications

6. Finance to a new era ++
Copyrights © Grow VC Group 2014

7. WE HAVE A DREAM:
more equal opportunities,
where entrepreneurs
and private investors unite
to accelerate innovation

8. Copyrights © Grow VC Group 2014
Short history ++
• We were probably the first equity crowdfunding service, launched the startup
crowdfunding in 2009
– The regulatory environment was very complex then, and it was the main reason
not to start in the US.
• We have done a lot of pioneer work in the market and also work finance regulators
e.g. in the US, UK, EU and Singapore
• With new innovations it is always difficult to predict the timing
– We decided that our model is to survive and adapt until the market really takes
off
• Important strategic review in May 2012 à from startup crowdfunding only to Grow VC
Group
– Grow VC Group is more like a holding company that have majority share in some
key ecosystem and infrastructure companies and minority in vertical oriented
crowdfunding or p2p market places typically with a partner that has strong
competence in the vertical in question
• Crowdfunding concept has really grown from startups to all kind of securities and
assets
• Also institutional investors are coming more interested, i.e. diversify their portfolio
through automated co-investing and co-lending platforms, and e.g. avoid the costs of
funds.

9. Copyrights © Grow VC Group 2014
Internet has been a distribution channel ++

10. Copyrights © Grow VC Group 2014
Disruption now – global virtual market places++

11. Copyrights © Grow VC Group 2014
Go back to the idea of stock market ++

12. Copyrights © Grow VC Group 2014
Create a new effective finance retail market ++
Crowd
investing
Market
Place
P2P
Lending
Companies /
Assets
Market Places Investors / resources

13. Copyrights © Grow VC Group 2014
Three big things for finance ++
1. Crowdfunding and similar market
places enable effective investment
and lending models for all kind of
investors, companies and assets
2. Market places enable new co-
investment and lending models, i.e.
get many kind of investors and
investment models to work
together
3. ‘Platforms’ can also ‘automate’ a
fund, i.e. investors don’t always
have to pay for fund management
fees, when a platform with
investment criteria and co-investing
models can do the same (a kind of
index fund)

14. Copyrights © Grow VC Group 2014
New regulation is coming ++
Title
I
(Crea'on
of
EGCs;
“IPO
on
ramp”)
Largely
effec've
on
enforcement.
Title
II
(Amendments
to
General
Solicita'on/Adver'sing)
Effec've
since
September
2013.
Title
III
(Crowdfunding,
i.e.
investments
from
non-­‐accredited
investors)
The
SEC
collected
comments
by
January
2014,
now
SEC
processes
the
comments,
expected
to
be
effec've
in
6
to
9.
Title
IV
(Increasing
Reg
A
offerings
to
up
to
$50
million)
Not
yet
effec've,
date
unclear.
Title
V
(Increased
thresholds
for
registra'on
with
SEC)
Largely
effec've
on
enforcement.
Title
VI
(Increased
thresholds
for
registra'on
with
SEC
for
banks)
Largely
effec've
on
enforcement.
Read more: http://www.crowdvalley.com/1/post/2013/10/jobs-act-where-are-we-now.html

15. Copyrights © Grow VC Group 2014
Opportunity for traditional finance companies too ++
1. Funding
round or loan
application
• A company opens a funding round or apply a
loan
2. Crowd
investing or
p2p lending
• Crowd, i.e. ordinary people, can offer
an investment or loan, and if enough
money available, the company gets
money
3. Co-
investment or
co-lending
• A bank or investment
company can join to a deal,
i.e. make co-investment or
participate the loan

16. § http://www.growvc.com/blog/"
§ http://www.crowdvalley.com/news.html "
§ http://www.startupcrowdfunding.com/blog.html"
§ http://www.growadvisors.com/news.html"
§ http://www.startupcommons.org/blog.html"
More about new finance models ++

17. Group Governance and Management ++
Copyrights © Grow VC Group 2014

18. § Majority and minority shares"
- Over 50% - clear control; under 50% - board and strategic decisions"
§ Grow VC Group Management"
- Strategic targets and decisions, e.g. new businesses"
- Monthly entity review: sales, revenue, costs, strategic targets, issues"
§ Each entity has its own management "
- Group representative in the board (Chairman position in the key companies)"
§ Some decisions require Group and entities to make a decision
together"
- For example, at the moment we discuss a case to offer the p2p platform,
business and investment instrument planning and Group investment in one new
p2p lending service in Asia"
Grow VC Group Governance ++

19. § Very entrepreneur type people – many team members have had
their own companies"
§ Very de-centralized organization"
- Key locations London, New York, San Francisco, and Hong Kong"
- Some resources in Helsinki"
- Team members in e.g. Germany, Italy, Brazil, Zimbabwe, India"
- Software development also e.g. in Vietnam, Ukraine, Pakistan, Thailand"
§ Online project management tools"
§ Regular calls"
§ Very self-driven people"
Management ++

21. New Strategies – in business and military
• Guerilla and terrorist organizations are fighting with small and self-organized cells, rapid
attacks to a strategic target, and leave the enemy to wonder, how and where to respond
• How someone can build an IED for a few hundred dollars and use it to destroy millions
of dollars military vehicles and fighters who have got top training and equipment
• Generally they mean that resources are not used to any other goal than the creation of
value for the end customer
• A lean startup gets a product beta version to the market as soon as possible, and then
based on the feedback and results develop it further
• Big organizations often like to build expensive systems and always expand
• Often you actually need more competent people and versatile technology and tools
Then they can better adapted to different kind of situations and needs, and they can
also surprise the competitor (or enemy)
• http://www.suomensotilas.fi/en/artikkelit/only-end-result-matters

22. Some visions ++
§ We cannot have one optimal model for all people"
§ Many people respect independent and self-driven roles, but they
are not easy"
§ Crowdsourcing and crowdfunding also have influence on
organizations à old centralized sourcing and funding structures
are not the only way to operate"
§ Agile organization, operations and teams"
§ Global organizations, capability to work in different cultures,
versatile competence and flexible attitude"
§ You must be genuinely in main market and respect their culture
and how the market work"
- No old-fashion export attitude, no teaching, and no arrogance"

23. Jouko Ahvenainen
jouko@growvc.com
+1 646 363 6664 (US)
+44 7889 833 165 (UK)
Grow VC Group ++
www.growvc.com ++
@growvc ++
Slideshare: Grow VC
MARKETS
ASSETS
CROWD