10 mistakes to avoid in seeking funding...• startups depend increasingly on personal savings and...
TRANSCRIPT
![Page 1: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/1.jpg)
1
Marketing to Investors
A Calyx Group ThinkTool
10 Mistakes to Avoid in Seeking Funding
![Page 2: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/2.jpg)
10 FUNDING STATISTICS
2
1. 77% of small businesses rely on personal savings for their initial funds.
2. A third of small businesses start with less than $5,000.
3. The average small business requires about $10,000 of startup capital.
4. Only 0.91 percent of startups are funded by angel investors
5. Only 0.05% of startups raise venture capital.
6. 38 percent receive funding from family and friends.
• The average seed round is $40 million.
1. The median company running a seed funding round is 3 years old.
2. Of startups that raised seed rounds, 1% reached unicorn status of $1B+
valuation.
3. Startups with two co-founders rather than one raise 30% more capital.
https://www.fundera.com/resources/startup-funding-statistics
![Page 3: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/3.jpg)
3
Mistake #1:
Assuming This is About You
THE INVESTOR HAS A VERY DIFFERENT
PERSPECTIVE!
![Page 4: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/4.jpg)
4
THE INVESTOR’S PERSPECTIVE
![Page 5: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/5.jpg)
5
Mistake #2:
Talking to the Wrong People
NO TWO INVESTORS ARE THE SAME
IS YOUR BUSINESS A FIT FOR THE ONES
YOU’RE TALKING TO?
![Page 6: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/6.jpg)
FOR WHOM ARE YOU A FIT?
6
Portfolio CompaniesEconomic Sector
Investment Stages Investment Thesis
![Page 7: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/7.jpg)
MISTAKE #3:
PITCHING THE
PRODUCT TO GET
INVESTMENT
7
![Page 8: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/8.jpg)
WHAT
INVESTORS
FUND IS THE
WHOLE EGG –
THE BUSINESS,
NOT THE
PRODUCT
PER SE
8
![Page 9: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/9.jpg)
MISTAKE #4:
LAYING OUT
FACTS
9
DATA DUMPS DON’T APPEAL TO EMOTIONS OR INSPIRE.
BUYING DECISIONS ARE BASED ON EMOTION..
![Page 10: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/10.jpg)
TO WIN INVESTORS
10
![Page 11: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/11.jpg)
11
Investors Want to Hear a Story
About Your Business
Stories are narratives that engage
emotion.
They change how the brain
processes information.
Your story is about a quest - how
to solve a customer problem in a
way that creates ROI for
investors.
Make it enjoyable, entertaining..
![Page 12: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/12.jpg)
MISTAKE #5:
HAVING GAPS IN PLANNING
12 “The plan is useless, but planning is essential.”
![Page 13: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/13.jpg)
MISTAKE #6:
MISUNDERSTANDING
THE MARKET NEED
13
PEOPLE DON’T WANT TO BUY A
QUARTER-INCH DRILL. THEY WANT A
QUARTER-INCH HOLE!”
PEOPLE DON’T WANT TO BUY
A QUARTER-INCH DRILL.
THEY WANT A QUARTER-INCH
HOLE!
(TED LEAVITT)
![Page 14: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/14.jpg)
IT’S ALL ABOUT HOW CUSTOMERS
DEFINE WHAT THEY NEED
14
JOB TO BE
DONECUSTOMER
SOLUTION
A JTBD is not a product, service, or a specific
solution; it’s whatever the customer needs to
achieve a desired state of being or outcome.
![Page 15: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/15.jpg)
The Market is About
What the Customer Needs
Regardless of Who the Customer Is
COMPANY JTBD NOT BASED ON
eBay Sell personal
items
An auction
psychographic
Google Find
information
A search
demographic
Swiffer Clean floors A profile of people
who mop
MedTech
Device
Heal wounds
cost-
effectively
Demographics or
psychographics of
patients or their
physicians
15
![Page 16: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/16.jpg)
MISTAKE #7:
DOWNPLAYING OR OMITTING MARKETING
16
PRODUCT
MARKETING
REVENUE
A MARKET CONSISTS OF
BUYERS AND SELLERS OF A
PARTICULAR PRODUCT WITH
THE POTENTIAL FOR A
TRANSACTION.
THE MARKETING PROCESS
CONNECTS YOUR PRODUCT
TO THE MARKET SO SALES
CAN CONNECT IT TO
REVENUE.
![Page 17: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/17.jpg)
HOW FAMILIAR ARE YOU WITH ALL
THE ASPECTS OF MARKETING?
17
![Page 18: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/18.jpg)
MARKETING SALES
• Gives strategic direction to the company & product development by understanding what products the customer wants to hire and the job to be done that is the reason why from Day 1 of the concept.
• Gets people interested in the product,
• Establishes the context for sales.
• Focused on customers and the market.
• Generates revenue
by getting people to
buy the product.
• Transfers ownership
of the product to a
customer in exchange
for revenue.
• Focused on the
product and company
after the product
exists.
18
![Page 19: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/19.jpg)
19
Mistake #7:
Failing to Protect IP Assets
• The right to use your
own invention
• Exclusivity
• Opportunities for
financial gain
• Opportunities for
monetization
• An investor priority
INTANGIBLE ASSETS NOW REPRESENT 87% OF S&P 500 MARKET VALUE
![Page 20: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/20.jpg)
20
BUSINESS
VALUE
Align IP & Business Strategy
Map Implementation
Initiate IP Protection Cost-Effectively
![Page 21: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/21.jpg)
MISTAKE #9:
HOCKEY STICK FINANCIALS
21
NO ONE BELIEVES IT
![Page 22: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/22.jpg)
22
SET REALISTIC TARGETS
MAKE REALISTIC
PROJECTIONS
![Page 23: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/23.jpg)
MISTAKE #10:
DISREGARDING
THE BOTTOM LINE
23
• Startups depend increasingly on personal savings and personal
loans to bootstrap into early revenue.
• VCs are investing more in fewer startups – taking fewer risks.
• The bottom line for startups: monetize.
• To appeal to investors.
• To qualify for small business loans.
• To self-fund - do it yourself - build your own momentum.
![Page 24: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/24.jpg)
FUNDING A STARTUP IS A STEP-BY-STEP JOURNEY
24
![Page 25: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/25.jpg)
25
NOW JUST DO IT!
![Page 26: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/26.jpg)
26
THE CALYX GROUP LLCMAKING INNOVATION FUNDABLE
212.421.5257
www.thecalyxgroup.com
Eleanor Haas, Managing Director
![Page 27: 10 Mistakes to Avoid in Seeking Funding...• Startups depend increasingly on personal savings and personal loans to bootstrap into early revenue. • VCs are investing more in fewer](https://reader034.vdocuments.net/reader034/viewer/2022050511/5f9b70fb85f5332e50512f79/html5/thumbnails/27.jpg)
Continuous Learning
• Job to be Done - Bob Moesta pioneered the concept http://jobstobedone.org/
• The Forum for Growth and Innovation is a community for practitioners familiar with the predictive theories taught by Professor Christensen at Harvard Business School in his signature course Building and Sustaining a Successful Enterprise (BSSE.). www.thefgi.net
• www.thefgi.net › uploads › 2010/09 › What-is-a-Business-Model
• Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist by Brad Feld (Author), Jason Mendelson (Author)
• How To Tell A Startup Is A Smart Investment, According To An Investor https://medium.com/@minutesmag/how-to-tell-a-startup-is-a-smart-investment-according-to-an-investor-cf86934c3e73
• Structure Your Presentation Like A Story https://hbr.org/2012/10/structure-your-presentation-li
27