: artiman ventures reviews innovation, start ups & lifecycle for venture funding
DESCRIPTION
This presentation by Amit Shah shares his insights on venture funding; Artiman reviews their focus on disruption and the stages in the lifecycle of a startup company. He describes the reasons for a start up as well as the different phases in the lifecycle of the start up.TRANSCRIPT
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Innovation, Startups, Life
Amit Shah
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What is Venture Funding?
Riskiest money: Equity without security
Money that your relatives will not lend you
A bank lends when you dont need it
Types of Venture fund
Seed
Like the individual / team
Early
When it is a concept: Mid
Product ready; some customers interested
Late stage funds
In revenue; need money for expansion
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Artiman: Investors & Entrepreneurs
U.S. Investment Team Amit Shah Yatin Mundkur Tom Dennedy Akhil Saklecha Ajit Singh Tim Wilson
India Team M. J. Aravind Ramesh Radhakrishnan
US Operations Team Ida Ng
EIR Frank Thibodeau Adam De La Zerda Mahmood Panjwani Atul Sharan
Venture Investing Experience
Collectively managing $900+M invested in 140+ seed/earlystage companies
88 exits with aggregate realized return of 3.3x
11 IPOs and 32 acquisitions
Entrepreneurial Experience
Co-founded 10 startups in the U.S. and India
6 successful exits with aggregate value of > $1 Billion
ZeitNet, PipeLinks, Equator, Daksh, Ross, Kaleida, Clarity, Airgo, BioImagene
Operating Experience - public and private
Cisco, Rockwell, Siemens, AMD, AT&T, Lucent, Cabletron, Digital Island, FireEye, Airgo, Clarity Wireless, Adaptive, Compaq, Qualcomm, HP
Technology Background
Played pioneering roles in seminal industries: Server Computing, Networking, Voice over IP, IPTV, Digital Consumer Electronics
26 US patents
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Concept and Early Stage World class entrepreneurs with ideas
Lower cost basis, providing significant ownership
Ability to impact company strategy
White Spaces Potential to dominate markets
No identifiable competition, with at least a 12-month lead on technology or market
Lower execution risk and outsized returns
Scalable Business Models
Develop technologies cost effectively
Scale the business efficiently
Fundamentally change economics of target sectors
Leverage India
Long-standing network and deep deal flow
Same disciplined screen as in Silicon Valley
To build companies that cannot be built in the US BioImagene, Guavus, Cellworks
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Investment Strategy
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Innovation
Best ideas have come from outside industry
Intersect expertise in one market with another
Think out of the box
Do NOT be a hammer in search of a nail
- Intersection of experience, market understanding, ability to
Execute
Is it a business?
Feature, Product or Company?
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Artiman: Focus on Disruption
BioImagene (Acquired by Roche) Changing Standard of Care in Pathology
Cellworks (www.cellworksgroup.com)
Designing drugs the way computer chips are designed
Aditazz (www.aditazz.com) Designing & building Facilities the way computer chips are
designed and fabricated
Zspace (www.zspace.com)
Non-invasive testing for Cardio-vascular diseases
Invensense (www.invensense.com) Motion Processing for consumer devices
Prysm (www.prysm.com) First American TV company in 30 years
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Why? O Why a startup?
The trigger for doing a startup
My boss sucks; I dont like my job;
He/she made it; why cant I?
Always wanted to do a startup
Caution:
Not sexy; most likely foolhardy
Very, very hard work with incredible ups/downs
Enjoyment is in hindsight
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Still want to do a startup?
Create a Business Plan
Not an excel spreadsheet or a word document or a powerpoint presentation
An innate and clear understanding of what you are going after
Remember:
if it is in the press it is too late
Truly understand the market dynamics
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The Money
Most businesses should not raise venture money
Do you really know why and how much money you need?
Who do you raise it from?
- Customers, partners, friends and family, angels, VCs
- Government (Darpa, SBIC,)
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The VCs
They are evil; dumb; do not understand my business; trying to screw me;
- All true
- No different than a marriage
How well do you know the person?
- Look beyond the sexy early days and to the
fat middle age and can you live with it?
- Ecosystem
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Finally
Actually doing a startup
Phases
Primordial
Middle Ages
Industrial Revolution
Deliverance
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Primordial
Concept
Early fools
Extreme Energy
Some lucidity
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Middle Ages
Newer Skeptics & converts
Energy / focus correlation
Outside thoughts
Confusion
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Industrial Revolution
Scale
Technology ready for customers
Sales and Marketing starts ramping
Internal Challenges
Job function confusion (mix of newer v/s older employees)
Communications
Hallway conversations dont work
Processes (unfortunately) needed
Fallout
People dissatisfaction
Inability to scale
Some dont make it thru transition
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Deliverance
Customer interaction starts Initially Skepticism
Goes to piddly stuff
Some more selling and it becomes maybe
If persistence, the customer converts
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Start-Up Check List
Establish business entity
Engage a lawyer/be cautious going solo with online resources
Corporation is the entity of choice if you plan to raise money for the business
Establish initial ownership of company with co-founders
Fed/State registration, business license and permits
Secure Key Personnel
As shareholders, consultants or employees
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Start-Up Check List (cont.)
Secure work space
Clean up the garage, lease an office, come to Artiman
Open bank account
Obtain necessary insurance
Workmens comp
Medical
Liability
Implement Accounting System
Popular Quickbooks is adequate
Select payroll vendor (Paychex, ADP)
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Business is Never as Planned
You will have to Refine your Business Plan
Annual Strategy Plan
Annual Operating Plan
Annual Financial Budgets
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Artiman Tool Kit
www.artiman.com/startup-toolkit
Templates and sample documents covering:
Annual Operating Plans
Board Meetings
Financial
Human Resource
Legal
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Artiman Tool Kit Index
Artiman Tool Kit Index Artiman Tool Kit Index
Description Format Description Format
1 AOP1 AOP Time Line Graphic Illustration PPT 21 HR2 Form of Offer Letter Word
2 AOP2 Sample AOP Time Line Excel 22 HR2.1 Form of Empl, Conf. Inf. and Inv. Assign. Agt Word
3 AOP3 Sample AOP PPT 23 HR3 New Hire Check List Excel
4 AOP4 Product Planning Template Word 24 HR4 Separation Release Letter Word
5 AOP5 Sample Project Responsibility Owners Word 25 HR5 EE Termination Check List PDF
6 Board1 Key Examples of Information for Board Meeting Excel 26 HR6 90 Day New Hire Review Form Word
7 Board2 Sample Board Package PPT 27 HR7 Employee Self-Evaluation Form Word
8 Board3 Action Item Template Excel 28 HR8 Performance Eval and Career Dev Form Word
9 Board4 Sample Board Consent by Email Word 29 HR9 Staff Empowerment Article Word
10 Board5 Sample Board Indemnification Agreement Word 30 HR10 Consultant Agreement Word
11 Board6 10 Immutable Rules for Exec Presentation PDF 31 Legal1 Sample VC Term Sheet Word
12 Fin1 Financial Package Excel 32 Legal2 Sample Non-Disclosure Agreement Word
13 Fin2 Company Cap Table Excel 33 Legal3 Sample Note & Warrant Purchase Agrmt Word
14 Fin3 Expense Report Template Excel 34 Legal4 Sample Note Word
15 Fin4 Insurance & Benefits Cost Schedule Excel 35 Legal5 Sample Warrant Agreement Word
16 Fin5 Sample Cash Investment Policy Word 36 Legal6 Sample Mgt Rights Agreement Word
17 Fin6 Sample Fixed Asset Capitalization Policy Word 37 Legal7 Form University License Term Sheet Word
18 Fin7 Sample Travel & Expense Reimbursement Policy Word 38 Legal8 Document Creation/Retention Review PPT
19 HR1 Sample Employee Handbook & Policies Word 39 Legal9 Fenwick Start-up Legal Resource Presto PDF
20 HR1.1 Sample Company Handbook Word