fundraising 101 (startup-chile)
TRANSCRIPT
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Aleksandr Dresen Kown - The Investor Platform
@alekskown
Fundraising 101
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Who am I?
• Product, code, sell
• As entrepreneur: 2 exits, 2 +/- ok, 3 fails
• Seedcamp, 11, A-tier funds, >50 angels
• Invested in 19 co’s: 2 exits
• Fintech, Fashiontech, …
@alekskown [email protected]
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What can I do for you?
• Positioning your product
• Pitch-training
• Access to $ via KOWN
@alekskown [email protected]
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Before you start
• Check other people’s failures
• What is it that you want to do?
• Who can help you and how?
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Investors care about great entrepreneurs &
disruptive scalable stuff
No one cares about mediocrity
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How do you become a great entrepreneur?
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Make mistakes.
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Make BIG mistakes.
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Max Levchin
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You learn a lot more from failure than from success.
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#1: (co-)Founders are KING
• Don’t be a solo player
• Don’t just get cofounders to have cofounders
• Be ready that your friends, colleagues, employees become enemies
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#2: Building a startup = rough
• Unpredictable
• Murphy’s law
• People suck
• Investors suck
• 99% fail. Failure is part of life
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Startup #Mafia
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#3: Focus on what really is important
• What exact pain are you solving?
• Choose 1 specific pain and solve it the best way you can.
• Focus
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#4: Build an MVP
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#5: MSP = MVP + Sales
MSP = Minimal Sellable Product
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#6: Use CL as test-market
LATAM Market is HUGE
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#7: Only tell people who need to know, when they need to know
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#8: Don’t waste time
Events Techcrunch Disrupt
Demodays Websummit
Rise Demo
…
Your time is your most valuable resource
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Pains for startups in CL
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Biggest pain for startups:
being underfunded
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2nd biggest pain:
small-minded investors who crave control
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3nd biggest pain:
Investors think that one can replace founders
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Result: snails survival mode
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What can you do?
• Be fast
• Be lean
• Be fanatically focused
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So who can give you $?
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The Players
• Huge difference between SV, LATAM & EU
• Angels
• Private Equity
• VC’s
• New Investors (non-tech)
@alekskown [email protected]
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Different players at different stages
• Vision + Team + MVP
• Product + Product Market fit + Some traction
• Revenue + LTV + CAC + clear growth strategy
@alekskown [email protected]
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VC’s
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Most VC’s are followers
• Most VC’s underperform and struggle to get access to hot startups.
• The leading 3% VC’s make 90% of all returns in startups.
• Analyst→Principal→Associate→Partner (decision)
@alekskown [email protected]
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How to connect to VC’s
• Be introduced by founders VC’s have backed previously
• Be introduced by someone they know and trust (angels, ban’s, accelerators …)
• Get noticed through TRACTION
@alekskown [email protected]
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Angels
• (ex)Entrepreneurs & top exec’s (senior)
• Invest from $20K to $100K
• Make 1 or 2 deals a year and take ages to decide
• Painful valuation & long negotiations
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• Painful and long selection process
• Very (very) slow decisions
• Invest from $100K to millions $
Business Angel Clubs
36
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Modern fundraising tools
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Modern fundraising tools
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Friends Family (Fools)
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Build a relationship (first)
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Find out everything you can about the investor
• Hobbies
• Previous investments
• Background
• Twitter, FB, Linkedin, …
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Build trust through shared interests, views, …
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The “Sales” Pitch
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What is the most important?• The Pain
• Context
• Emotional connection
• Your Product
• Business Model
• Team
• Market size
• Competition
• Traction
@alekskown [email protected]
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What is the most important?• The Pain
• Context
•Emotional connection • Your Product
• Business Model
• Team
• Market size
• Competition
• Traction
@alekskown [email protected]
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The “customer” investor
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The “parent” investor
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Dreamers
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The pitch is dead
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Tell your story
• Forget the slides … when you talk to investors … tell your story, vision and plans
@alekskown [email protected]
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Be ready for investors
• Prepare, prepare, prepare
• MSP - have a product
• Traction
• What’s next
@alekskown [email protected]
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Projections?
• Assumptions are useless until you have sales and understand customer acquisition costs and lifetime value of a client
@alekskown [email protected]
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Valuations (don’t) matter
• Max. 10/15% per round
• Even the best projects don’t get follow-up funding if your cap table is fucked up
• Get enough runway per round
@alekskown [email protected]
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Investor English
• Contact me when X or Y happens =
• What is yr business model? =
• What is your exit strategy? =
• How did you calculate your valuation? =
@alekskown [email protected]
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Looking for TALENT
• Commercial/Leaders
• Devs (JS, iOS, Android)
• UX/Interface designers
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Contacts
• fb.com/dresenco
• slideshare.com/alekskown
• @alekskown (twitter)