Getting funded
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Getting Funded Surfing Metaphor Re-created by Allen Kim
description
4 Key components VC's look for in investing companies
Transcript of Getting funded
Getting Funded
Surfing MetaphorRe-created by Allen Kim
Surfing metaphor
The concept was initially came about by an investor in Sequoia Ventures as an analogy to what VCs look for in startups
Surfing metaphor
There are 4 parts to the surfing metaphor
1. The Surfer(Most important)
Surfer = The Team
The team is the most important aspect for early stage startups.
Your team must be smart, passionate with the idea, dedicated, and focused.
Qualities of a great team
• Tenacity (Don’t give up easily)
• Street smart (Go out talk to customers with the right questions)
• Resiliency (Entrepreneurs don’t die, they commit suicide)
• Willingness to accept risk (Go all in or go home get a job)
• Competitiveness (There are competitions. Play to win)
• Decisiveness / Gets things done (Get s&*t done fast)
• Ability to pivot (Best entrepreneurs fine tune their biz model)
Source: From Mark Suster’s Entrepreneur’s DNA
Experienced Entrepreneurs
$$$=
Give me $30M formy next startup
Sure no problem
Entrepreneur VC
2. The Wave
Wave = Market
VC’s want entrepreneurs tackling big problems (≠hard problems) with big market opportunity
Big Market
Pivot
Pivot
Small Market
Baby professional sports apparel
Baby apparel
Market Size
Understand what market you are addressing
• What’s the market for my product?• How many people are gonna pay for it?• How much are they gonna pay for it?• When are they gonna pay?
Addressable Market size for your business
Addressable marketis $1B+
(if true)
$$$
3. The Surfboard
Surfboard = Product
The surfboard analogy is all about what your product does and how it serves your market
You need a product that’s a 10x painkiller
Why?
Because it has to be compelling enough to change the way your customers normally do things and pay money to use your product
Surfboard = Product
The surfboard analogy is all about what your product does and how it serves your market
You need a product that’s a 10x painkiller
Why?
Because it has to be compelling enough to change the way your customers normally do things and pay money to use your product
Providing new value to customers = hard
Your product
What does my product do?
What pain point does it address?
How is this different from other products?Why should someone use this?What product does the market currently use?Can your product beat your competitor’s?
People love it so much,we are experiencing a hockey stick growth!
time
# users/customers
$$$
4. The RideThe Deal & Why now?
Why Now?
Fail pointsImmature Market
Product is great, but the market is not ready for it
Fail points
There are too many playersin the market (Groupons)
Saturated Market
You have to have a good understanding of why this product hasn’t been built before and why now is the best time the world needs this.
Why Now?
In addition to the market, the deal itself has to be fair: The valuation of your company’s worth and the structure of the term sheet.
The VC Deal
(Will go more into details in later presentations)
You need to check if the VCs have reputable investmentbackground, understand your industry, and are
friendly to founders with fair terms
(I’ll cover more on this in detail later)
I want 50% of your company for $100k
Oh and I want you out
How to get fundedSummary
The Team The Market
The Product Why Now
VC Funded = Startup success?
Where do entrepreneurs get their money?
http://video.kauffman.org/services/player/bcpid40280745001?bckey=AQ~~,AAAAAF1AP-k~,paP-6btd7SPcN3he8b6wgT6uI64ClnLc&bctid=1304559795001
VC Funded = Startup success
Successfully bootstrapped companies
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Thanks!Made by Allen Kim
www.allenkim.me
