9 common startup mistakes + things to know about venture capital for first-time entrepreneurs...
DESCRIPTION
9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs. Presented at Startup Weekend - University of Michigan (Ann Arbor).TRANSCRIPT
![Page 1: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/1.jpg)
9 Common Startup Mistakes
+Things to Know About
Venture CapitalMICHAEL GAISS
Senior Vice President, Highland Capital Partners
[email protected] | @michaelgaiss
Startup Weekend University of MichiganJanuary 23, 2011
![Page 2: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/2.jpg)
Background
Formed in 1988 $3 billion under management, 8 funds, backed 200+
companies Diversified portfolio strategy
tech | internet | life sciences | consumer
seed | early | growth
20 investment professionals in Boston, Silicon Valley, Geneva, & Shanghai
About me University of Michigan (Engineering), University of St. Thomas (MBA)
Unisys, IQ Software, Gentia Software
Entrepreneurial Initiatives + Portfolio Support + Marketing
![Page 3: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/3.jpg)
We back entrepreneurs with big ambitions.
![Page 4: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/4.jpg)
We back young entrepreneurs.
![Page 5: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/5.jpg)
We back young entrepreneurs.
![Page 6: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/6.jpg)
We back young entrepreneurs.
![Page 7: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/7.jpg)
We back young entrepreneurs.
![Page 8: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/8.jpg)
We back young entrepreneurs.
![Page 9: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/9.jpg)
We love early stage.
![Page 10: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/10.jpg)
![Page 11: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/11.jpg)
We look to build relationships early.
Money $15K/team
Free office space Boston or San Fran
Mentoring Our team + founders/CEOs
Value-Add Services Access to our network + Summer School Curriculum + Career Network
No obligation to Highland
www.hcp.com/signup
![Page 12: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/12.jpg)
Joshua FeastMIT Sloan School of Management
Alain ChuardStanford Graduate School of Business
Motomu Shimaoka & Ann DeWitt Harvard Medical School & HBS
Mike SullivanHarvard University
Matt LauzonBabson College
Victoria RansomHarvard Business School
Jeff LeBrun & John RiceUniversity of Michigan Ross School of Business
Will O’BrienMIT Sloan School of Management
![Page 13: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/13.jpg)
If you’re not starting a company, join one of ours.
www.hcp.com/careers
![Page 14: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/14.jpg)
9 Mistakes Entrepreneurs Often Make on their First Startup
Less of this More of this
![Page 15: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/15.jpg)
#1: Didn’t research & understand the competition.
![Page 16: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/16.jpg)
#2: Haven’t talked to customers.
![Page 17: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/17.jpg)
#3: No repeatable customer acquisition strategy.
![Page 18: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/18.jpg)
#4: Don’t tell a good story.
![Page 19: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/19.jpg)
#5: Know nothing about the investors they’re pitching.
![Page 20: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/20.jpg)
#6: Make stuff up instead of saying “I don’t know.”
![Page 21: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/21.jpg)
#7: Seek only confirming, not disconfirming evidence.
![Page 22: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/22.jpg)
#8: Pick advisors that are easily accessible, not relevant.
![Page 23: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/23.jpg)
#9: Treat fundraising like it’s an end, not a means.
![Page 24: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/24.jpg)
What First-Time Entrepreneurs Should Know about Venture Capital
Assumes:You have a team.You’re building stuff.But, you need $$$.
![Page 25: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/25.jpg)
VC is just one of many ways to finance your startup.
BootstrapBootstrap
LoansLoans
Friends & familyFriends & family
Angels / seed firmsAngels / seed firms
Venture capitalVenture capital
Growth equityGrowth equity
Public marketsPublic markets
EquityNon-equityRisk
Size of check
Grants / PrizesGrants / Prizes
![Page 26: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/26.jpg)
We get paid from a few home runs (are you one?).
($50.0)
$0.0
$50.0
$100.0
$150.0
$200.0
$250.0
$300.0
$350.0
$M
M
Home run $20.0 $200.00 $180.00
Middle $30.0 $90.00 $60.00
Bad $50.0 $25.00 ($25.00)
Investment Return Profit
TOTAL $100.0 $315.0 $215.0
2 deals, 10x
3 deals, 3x
5 deals, 0.5x
All 10 deals, 3.2x
![Page 27: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/27.jpg)
What are the most important things to us?
Market $1B+ addressable
slice Powerful macro
drivers
Deal Capital efficient Milestone-based
Team Relevant Hungry
Product / Technology “Painkillers, not
vitamins” Unfair advantage
![Page 28: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/28.jpg)
We like good ideas, but prefer great execution.
Good idea Great execution
![Page 29: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/29.jpg)
We love numbers (are you measuring everything?).
Check out blogs by David Cancel and David Skok for more:www.davidcancel.com www.forentrepreneurs.com
![Page 30: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/30.jpg)
It’s easier to get our advice than our money.
![Page 31: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/31.jpg)
We’re here to help
Entrepreneurship Central www.hcp.com/entrepreneurship_central
Summer@Highland www.hcp.com/signup OR www.hcp.com/summer
Career Opportunities www.hcp.com/careers
Social Highland Entrepreneur Network – LinkedIn Group (800+ members)
Twitter: @HighlandCapital
Facebook: www.facebook.com/HighlandCapitalPartners
![Page 32: 9 Common Startup Mistakes + Things to Know About Venture Capital for First-Time Entrepreneurs (Startup Weekend)](https://reader030.vdocuments.mx/reader030/viewer/2022012916/55493bacb4c905054d8b4c16/html5/thumbnails/32.jpg)
Startup Mistakes to Avoid +
Things to Know AboutVenture Capital
MICHAEL GAISSSenior Vice President, Highland Capital
[email protected] | @michaelgaiss
Startup Weekend University of MichiganJanuary 23, 2011