the rise of the angels (and the entrepreneurs) - norfolk - march 2013

@paulsingh #startnorfolk

PAUL SINGH

@paulsingh・paul@500startups.com・resultsjunkies.com

THE RISE OF THE ANGELS (AND THE ENTREPRENEURS)

@paulsingh #startnorfolk

500 STARTUPSGETTING TO KNOW

BECAUSE WE’RE KIND OF A BIG DEAL

PAUL SINGH

@paulsingh・paul@500startups.com・resultsjunkies.com

@paulsingh #startnorfolk

@paulsingh #startnorfolk

EARLY STAGE STARTUPS

HAVE CHANGED

@paulsingh #startnorfolk

STARTUP COSTS LOWER THAN EVER

BUT SCALING STILL COSTS MONEY

CLOUD, OPEN SOURCE AND ONLINE DISTRIBUTION DRIVING

@paulsingh #startnorfolk

WEB GETS BIGGER.WORLD GETS SMALLER.

@paulsingh #startnorfolk

TRACTION IS THE NEW INTELLECTUAL PROPERTYPLATFORMS (SEARCH, SOCIAL & MOBILE) PRIMARILY DRIVING THE CHANGE.

NO LONGER “GOOD ENOUGH” TO DEPEND ON TECH DIFFERENTIATION.

@paulsingh #startnorfolk

CAPITAL INCREASINGLY COMMODITIZED

RISE OF THE ANGELS, YO!

@paulsingh #startnorfolk

NEW REALITY: MONEY FOLLOWS

FOUNDERSRISE OF THE ENTREPRENEURS, YO!

@paulsingh #startnorfolk

SIGNALS ARE EVERYWHERE

BIG DATA + OPEN SOURCE ANALYTICS = NEW TECHNIQUES FOR VC

@paulsingh #startnorfolk

SIGNALS ARE EVERYWHERE

BIG DATA + OPEN SOURCE ANALYTICS = NEW TECHNIQUES FOR VC

@paulsingh #startnorfolk

TRANSPARENCY ISSIGNALS ARE EVERYWHERE

BIG DATA + OPEN SOURCE ANALYTICS = NEW TECHNIQUES FOR VC

@paulsingh #startnorfolk

WALL STREET BEAT US TO IT

@paulsingh #startnorfolk

@paulsingh #startnorfolk

UBS PROPRIETARY SATELLITE PARKING LOT FILL RATE ANALYSIS POINTS TO AN INTERESTING CADENCE INTRA-QUARTER AND POTENTIAL UPSIDE TO OUR VIEW.

“

@paulsingh #startnorfolk

@paulsingh #startnorfolk

TWICE A WEEK A SMALL HELICOPTER CIRCLES OVER CUSHING’S TANK FARMS ON AN OIL INDUSTRY SPYING MISSION.

“

@paulsingh #startnorfolk

WALL STREET ISN’T ALONE

THESE TECHNIQUES ALREADY USED TO UNDERWRITE IN-VITRO FERTILIZATION LENDING, PAYDAY LOANS, SUBPRIME AUTO LENDING, HOME/PERSONAL/AUTO INSURANCE AND MORE.

@paulsingh #startnorfolk

WE CAN DO IT, TOOSURPRISE!

IT TURNS OUT,

@paulsingh #startnorfolk

@paulsingh #startnorfolk

+ “GUT” + TRUSTED MENTORS + MUCH, MUCH MORE DATA.

@paulsingh #startnorfolk

WE CAN DO IT, TOO.

@paulsingh #startnorfolk

WE CAN DO IT, TOO.

@paulsingh #startnorfolk

WE’RE DOING IT, TOO.

@paulsingh #startnorfolk

@paulsingh #startnorfolk

VENTURE CAPITAL IS OPEN TO ATTACK BY DISRUPTIVE NEW BUSINESS MODELS AND TECHNOLOGY.

“

-- NAVAL RAVIKANT (@naval)

@paulsingh #startnorfolk

EARLY STAGE VCIS CHANGINGHAS CHANGED

@paulsingh #startnorfolk

STATE OF THE ART IN EARLY STAGE INVESTING IS NOT

VERY SOPHISTICATED

@paulsingh #startnorfolk

UNBUNDLING OF ADVICE, CONTROL

AND MONEY

@paulsingh #startnorfolk

USED TO BE ABOUT CAPITAL, DEALFLOW

AND JUDGEMENTTODAY, IT’S ABOUT ACCESS.

@paulsingh #startnorfolk

(500) CHECKLISTProduct solves a problem for a specific target customer

Capital-efficient businesses - operational @ <$1M funding

Primarily internet-based distribution - search, social, mobile, local

Simple revenue models - transactions, subscriptions or affiliate

Functional prototype before investment (or previous success)

Small but measurable usage - some customers, early revenue

Small but cross-functional team - engineer, design/UX, marketing

@paulsingh #startnorfolk

(NEW) FINANCINGS Standardized terms

No fixed amounts, no closings, no leads

Continuous, not discrete rounds

Prices beginning to float

No Board seats at the earliest stage

Herd mentality and oversubscriptions

@paulsingh #startnorfolk

THE PRIVATE MARKETS ARE BECOMING

LIQUID AND EFFICIENT

@paulsingh #startnorfolk

BY ITS NATURE, THE INTERNET UNDERMINES ANYONE WHOSE STATUS DEPENDS ON PRIVILEGED ACCESS TO INFORMATION.

“

-- MICHAEL LEWIS

@paulsingh #startnorfolk

Demo Day Videos ⟹ livestream.com/500startups

Sample Pitch Decks ⟹ slideshare.net/500startups

Venture Capital 101 ⟹ venturehacks.com/archives

Investor Thoughts:

Brad Feld ⟹ feld.com

Fred Wilson ⟹ avc.com

Chris Dixon ⟹ cdixon.org

Mark Suster ⟹ bothsidesofthetable.com

angel.co/valuations and angel.co/salaries

@paulsingh #startnorfolk

YOUR KEY TAKEAWAYS

Focus on Traction.

Learn to Communicate and Inspire.

@paulsingh #startnorfolk

ALSO... Distribution > Product

Tactics > Strategy

Focus on customer acquisition

Get on AngelList

Raise 12-18+ months of funding

Learn the basics of VC economics

Progress and Probability

Coming soon: dashboard.io

@paulsingh #startnorfolk

THE RISE OF THE ANGELS (AND THE ENTREPRENEURS)

PAUL SINGH

@paulsingh・paul@500startups.com・resultsjunkies.com