can you find me the right investor 5 oct 2012

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"Can you find me the right investor?" "What are the chances of success?" "What are the odds of finding an Investor for my Company?" I am asked these questions all of the time as if finding investors for companies was like throwing darts at a dart board; if you hit the bull you get funding, Right? Well not quite. In this blog piece and the accompanying video, I will try to share with you some of the complexities in the funding process. I want to try to demonstrate that building a systematic funnel is much better than throwing darts! Lets start by looking at some statistics from Crunchbase. This free online database lists over 100,000 companies and over 30,000 funding rounds. Crunchbase also shows us that there have been literally thousands of Seed Rounds, Angel Rounds and Series A, B and C rounds. Furthermore over 9,000 funding rounds are unattributed. In our research over the past decade, we have identified over 1,200 investors in the UK and this dataset only has a small number of Angel and High Net Worth investors. We are predominantly talking about funds, networks and family offices. So where do you start? In the video I walk through a series of factors that need to be taken into account when trying to select investors. These include: Investor Type Sector Stage Funding Round Deal Size Risk Geography VC Portfolio VC Specific Odds Investment Criteria Deal Criteria Process Documentation Term Sheet VC Deal Flow Conflicting Interests Unfortunately, finding the Right Investor involves kissing a lot of frogs! I do not believe that there are any short cuts, they take too long! Claim your Free Six Minute Strategist Six Minute Audit at http://jbdcolley.com If you would like to discuss with me how we can assist your business, please email me at john.colley@iafcapital.com or call me on my UK cell phone +44 7813 672 612 Thank you for joining the Conversation!

TRANSCRIPT

© John colley 2012

http://jbdcolley.com

The Six Minute StrategistBusiness Strategy, Make Smarter Decisions

Can you find me the

Right Investor?

© John colley 2012

The Six Minute Strategist

http://jbdcolley.com

© John colley 2012

The Six Minute Strategist

http://jbdcolley.com

© John colley 2012

Crunchbase Statistics

The Six Minute Strategist

http://jbdcolley.com

© John colley 2012

The Six Minute Strategist

http://jbdcolley.com

How big is the Tech Funding Market?

100,000 + Companies8,277 Financial Organisations133,000 People4,721 Service Providers30,867 Funding Rounds7,128 Acquisitions

© John colley 2012

The Six Minute Strategist

http://jbdcolley.com

What do the funding rounds look like?

6,044 Seed2,611 Angel6,390 Series A4,094 Series B2,098 Series C9,022 Unattributed

© John colley 2012

The Six Minute Strategist

http://jbdcolley.com

Can’t See the wood for the trees?

© John colley 2012

Investor Type

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Friends & Family High Net Worth

Founders and Management

Existing Shareholders Family Offices

Venture Capital Private Equity

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Sector

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Agriculture

Biogas

Biotech

Building Products

Capital Goods

Chemicals

Clean Tech

Commodities

Computers

Conglomerates

Construction

Consumer

Depository InstitutionseCommerce

Education

Electronics

Energy

Engineering

Entertaining

Environmental

Financial Services

Food and Beverage

Gaming and Lodging

Government

Healthcare

Hotels, Restaurants & PubsIT Services

Industrial

Infrastructure

Intellectual Property

Internet

Leisure

Life Science

Luxury

Media

Medical

Metals

Mining

Mobile

Paper

Natural Resources

Oil & Gas

Packaging

PharmaceuticalsPaper

Real estate

Renewables

RetailSecurity

Services

Steel

Transport

Utilities

VC

© John colley 2012

Stage

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SeedAngel

Series ASeries BSeries CSeries DPre IPO

PEAcq Finance

Public to PrivateBuy and BuildEquity Release

ReCapSpin OutBridgeActiveRescue

TurnaroundLBOMBOMBI

ExpansionMezzanine

Venture DebtJunior Equity

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Funding Round

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What round are you Doing?

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Deal Size

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Fund Size Sweet Spot

<100k <500k <2m

<10M <100M >100M

£ or $

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Risk

The Six Minute Strategist

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Prototype Product

Customer Market

Scale Expansion

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Geography

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Limitations

Proximity Market

Location

© John colley 2012

Portfolio

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Does it Fit?

Does it Compete?

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VC Specific Odds?

The Six Minute Strategist

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500

1%5

© John colley 2012

The Six Minute Strategist

http://jbdcolley.com

Customer Pain

Pre- or Post Revenue

Investment Criteria

ProfitableCash Flow BreakEven

Min Deal Size Max Deal Size

Minority Majority

Investment Style Board Seat

Sole Investor Syndicate

© John colley 2012

Deal Criteria

The Six Minute Strategist

http://jbdcolley.com

Management

Customer Pain

Product Solution

Customer Pain

USPs

Competition

Market Size

ScalabilityExit Route

Valuation Funding need

Market Opportunity

Stage of Business

Channels to market

© John colley 2012

Process

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Identify Approach Meeting

InformationInformal DDInvestment Review

Term Sheet Formal DD Conditional Approval

DocumentationFormal ApprovalClose

© John colley 2012

Documentation

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Elevator Pitch Executive Summary

Management Presentation

Business Plan Financial Plan

Market Research DD Material

Management Information

© John colley 2012

Term Sheet

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Economic Control

Other

© John colley 2012

In the Deal Flow

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© John colley 2012

Conflictinginterests

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Founders

Employees

ExistingShareholders

New Investors

Board of Directors Management

© John colley 2012

Kiss a lot of Frogs

The Six Minute Strategist

http://jbdcolley.com

© John colley 2012

Can you find me the Right Investor?

The Six Minute Strategist

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I’m sorry, we don’t have time for short cutsthey take too Long!

© John colley 2012

Want to know More?

The Six Minute Strategist

http://jbdcolley.com

Contact me Now

John Colley

jbdcolley@aol.com

07813 672612

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