business modelling and finance
DESCRIPTION
July 10, 2014, Jana Scharfschwerdt, Interim CFO of Somea People Partners, led a workshop for BSA teams on developing their financial plans. More slideshares from Jana: http://www.slideshare.net/scharfschwerdt More information about the company: http://www.someapartners.de/TRANSCRIPT
Workshop: Business Modelling & Finance
Berlin Startup Academy, 10.07.2014 - Jana Scharfschwerdt
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A good financial model
Fundraising – when and where?
Alternatives of investments
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Proof-of-Concept
Business Angels
Financing options
Accelerator / Crowdfunding
Venture Capital
Crowdinvesting
Incubator
Bank loan
Idea Proof of Concept Realisation Scaling
Product develop.
Finding/Testing a business model
1st customers
Product improve-ments
Product / Market
Fit
Brainstorming and team building
Realize revenues
Roll out model
Install processes, standards and projects
Optimize processes
Expansion
Internationalisation
Startup/Early Stage Later Stage
Analysis
Seed Pre-seed
...is a great start for fundraising
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How do Angel investors click
VC investors
§ Will want some control (voting, board, veto)
§ Invests usually start at 500K, can provide Series A/B
§ Will want to own 20-30%
§ Very actively engaged
§ Can add tremendous value an be great business partners
§ Can take a lot longer until signing
§ Typically rational actors, commercially driven, but if inexperienced, he can be a total mess
Angel investors
§ Contribution over control
§ Usually engaged (often a hobby, sometimes a personal mission)
§ Can be great experienced mentors with a valuable network
§ Quick in decisions, on a personal level
§ Typically rational, but if unexperienced: Naive irrational
§ Investment 200 – 300 K max.
§ Will want to own 1-20%
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Investment criteria Intangible things investors like to see:
§ An ability to recruit and retain a great team, partners
§ Interpersonal chemistry
§ Good sustainable story: its a movie, not a snapshot
§ Somebody else committed?
Tangible things investors like to see
§ Very big market (> $500m)
§ Unfair advantage (why you? why now?)
§ Attractive business model (recurring, high gross margin)
§ Unique technology or business model approach
Investment criteria
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Which investor would be best for you
§ How much money do I need?
§ Where do I need network?
§ Synergies with existing investments?
§ Industry or product experience?
§ Will I expand internationally rather early?
§ Reputation and brand support
§ How many rounds do I think will be necessary?
§ What would be the paths to exit?
§ Strategic partner – Corporate VC
§ Experience with IPO
§ Relevant industry contacts (trade sales)
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Scoping out the firm - Which documents to provide?
1st things first § Financial planning
§ Assumptions
§ P+L § Cash-flow statement § Time Span: Monthly until break even (at least 1st year) , ideally 5 years projections
§ Current Cap Table showing pre and post money holdings
§ Investor‘s Deck
§ 10 page slide deck (a complete doc usually only for banks) § Well designed and free of mistakes § Keep it simple: they’re meant to be presented, so don’t include all text § Support info with charts and graphs § Imaging your own attantion span § Make the audience nod on every slide
§ Tell a story that is clear and exciting © Rudie – Fotolia
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Investment criteria § YOUR business model
§ Subscription, listings, market places, do you pile up physical stock?
§ Cashflow = earnings ?
§ Where does the money come from and where do you invest
§ Metrics to watch
§ Different sources of financing and is tailored to receiver
§ Who and how will you be using it internally ?
A clean and clear model shows....
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Please avoid to be kicked out, so don‘t ...
§ Build it too complex and confusing § 5+ sheets § Linking cells can not be followed
§ Forget to mirror the business model
§ Make it static, so the investor can‘t play with assumptions
§ Content that conveys the wrong message: § Liablibities that drag cash out of the firm § High founder‘s salary
§ Sending it as PDF or only on NDA
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Investment criteria Other alternative investments
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Convertible loan: A loan today will be converted into stocks later
Crowdinvesting: Mostly patriarchic subordinate loan
Advisory shares
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Who is ready for funding?
Master background © Aleksandr Bryliaev / Fotolia
Thx for joining www.someapartners.de