Lecture Notes: Alternate Financial Strategies

Speaker: Daniel Ross, PDD Class

In the land of Lemins, how do you find a leader?

How do you build a syndicate?

With less than/more than 10M

Angel Investors -Usually less tha 10M

VCs -Usually greater than 10M

Fundraising 2-6 Months

Getting VC Attention

* Introduction by a trusted firm or friend.

* Sexy Technology

* Your Business plan is a marketing tool.-Get an expert to write it

* Understand the comfort zone of different firms.

* Early/late stage investors?

* What verticals do they focus on?

* Can they leverage their strategies?

* Ask yourself: How long can I wait to get more ownership?

* Hot fields: Biotech, security, storage.

* What does the leader need from you?

o Credibility of CEO

+ Track record

+ Topical experience

+ Ability to attract a strong team.

o Strengths of the VP

+ Sales, marketing, business development

o Advisory Board

+ Brand names

+ luminaries

+ connections

o Huge market potential

o Does product work?

+ in production?

+ Betas?

o IP applications filed?

o Anyone eating your dogfood?

+ Customers?

+ traction?

* Always use other people's money.

* Avoid using yours. You commit enough by committing time and effort.

* What are VC's exit strategies?

SBIR to Government Contacts fund $500,000 to bring an idea to commercially not necessarily to market.

Beltway Bandits:

- You are competing with people not in your market

- Don't go to just one partner or VC. You are better off with more

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