TCF.. CIF.. WTF(unding)? How to prepare a winning application for TCF/CIF
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WTF(unding)? How to prepare a winning application for TCF/CIF
Transcript of TCF.. CIF.. WTF(unding)? How to prepare a winning application for TCF/CIF
WTF(unding)? How to prepare a winning
application for TCF/CIF
To invest or not . . . That is the question
The Application &
Review Process
Technology Commercialization Fund
Purpose:
Fund product development to position a company for follow-on investment
Who:
Early-stage companies in MD meeting eligibility requirements
What:
$100K Investment – 4 tranches Additional $125K follow-on possible
When:
1st of every month
Program Contact:
Henry Ahn [email protected]
Cybersecurity Investment Fund
Purpose:
Fund product development to position a company for follow-on investment
Who:
“Cybersecurity” companies in MD meeting eligibility requirements
What:
$100K Investment – 4 tranches Additional $125K follow-on possible
When:
1st of every month
Program Contact:
Henry Ahn [email protected]
Eligibility Requirements
Companies with less than 16 FTE’s
At least 50%
working in Maryland
AND
Pre-revenue, OR
<$500K qualified investment
Review Timeline
TCF
CIF
Month 1 Month 2
1st
1st
Application Due Date
Compliance Check and Initial Review
Compliance Check and Initial Review
Site Visit
Site Visit
Pitch to Committee: 3rd Wed of the month
Pitch to Committee: 3rd Wed of the month
8% Convertible Note
5 Year term
Conversion triggers:
• $500K Qualified Investment
• Acquisition
No discount
No cap
Investment Terms
Where do I get more information?
W W W . T E D C O . M D
Where do I get more information?
Request for Application
Funding Document
Application Link
Program Manager
Checklist
Designing a
Suitable Project
Concept vs. Reality
No Napkins . . . Please!
What’s a Good Project?
A commercialization pathway
What’s a Good Project?
An addressable market
What’s a Good Project?
Qualified team
What’s a Good Project?
Differentiation
Project Details
12 Months
3 Milestones
20% Indirect costs
50% Company match (cash or in-kind)
Actual Project Example
Timing Pmt Description
Up front payment $25,000 None
Milestone 1 $25,000 • Implement gamification elements • Implement scoring algorithm • Provide teacher w/ IEP support
Milestone 2 $25,000 • Implement peer sharing • Implement multiple assignments • Implement auto-complete
Milestone 3 $25,000 • Pilot speaking & listening practice & assessment tools
• Enable audio/video upload
Financial Projections
Basic Rules…
1. Yes, you do need financial projections!
2. It's not accounting, it’s business.
3. Are never be correct…but must make sense.
• Investors will discount your projections.
• They have to be “big enough” to matter.
• They are a reflection of your assumptions about
the business, dressed up to look like a P&L.
4. Goal is to discuss assumptions, not numbers.
Market…
“I need 0.01% of this huge market to make money!!”
Macro (Top Down) approach is not acceptable
because no one can assess whether your plan is
reasonable and whether you can execute.
Micro (Bottom Up) approach is preferred because it
starts with the customer and is grounded in market
research.
A Suggestion…
Link your Market Segmentation Strategy & Market
Research to your Financials.
1. Use market research to add credibility to assumptions.
2. Use segment strategy & assumptions about contract
value & structure to build annual revenue projections.
3. Use estimate of COGS to calculate gross margin % and
operating profit.
4. Use segment strategy & assumptions about sales
channels & other overhead expenses to build annual
SG&A budget.
5. Calculate EBIT and determine investment needs.
In other “words”…
Financial Projections Template
Financials are not separate from the business plan. They are a different way
ofrepresenting that plan.
Watch out for…
1. Constant %GM
2. %GM too low.
3. Constant %SG&A.
4. Multiples of prior years.
5. Confusing cash with accounting – It’s all about
burn rate and investment needs, not
depreciation, amortization, and revenue
recognition rules.
Now that you’re all done…
1. Calculate % share of the total market.
2. Share should be reasonably attainable, allowing for
plenty of downside risk and upside opportunity.
3. In other words “not too large and not too
small…just right!”.
4. And, if you didn’t notice, what was just outlined
here is about 2/3 of a 10 slide investor pitch deck!
What is TEDCO
Looking For?
What is TEDCO Looking For?
Innovative/disruptive, seed stage, technology-enabled solution in a large, growing market.
Biologic/diagnostic
Medical device
Health IT / Tele-health
Enterprise software
Web application
Engineered product
You get the picture…but, not simply a “me too” play.
TEDCO TOP 10 LIST
#1…
Follow the instructions in the Request for Application (RFA).
It sounds simple, but you’d be surprised!
And, remember, the “customer” is always right.
#2…
Refine your proposal with the help of outside advisors.
Because you’re competing with all funded plans, not just those submitted this month.
TEDCO TOP 10 LIST
#3…
Show us some data.
Life Sciences – in vitro studies
Engineered products – prototype & lab testing
Software – MVP & some user feedback
And there may be more stage-appropriate funding options.
TEDCO TOP 10 LIST
#4…
Show us a team.
We understand “stage-appropriate”.
Blend business with technical.
Use no/low cost external resources to fill holes.
What new hires are needed and when?
Remember…Marketing & sales is commonly overlooked.
TEDCO TOP 10 LIST
#5…
Show us a business, not just a technology.
Revenue model.
Go-to-market plan
Competitive analysis
TEDCO TOP 10 LIST
#6…
Show us a value proposition.
What “pain” are you alleviating?
How is the value of your solution measured?
What will motivate the buyer to act?
TEDCO TOP 10 LIST
#7…
Show that you understand customer & market.
Maximize actual market research.
Platform? Identify a target segment.
Life Sciences? Address FDA & reimbursement.
And be sure to identify the paying customer!
TEDCO TOP 10 LIST
#8…
Show us a go-to-market plan.
Can be a powerful competitive differentiator.
And don’t expect the customer to alter it’s buying habits!
TEDCO TOP 10 LIST
#9…
Link financial projections to all elements of your plan.
Can be a powerful competitive differentiator.
Include operating metrics…how big is the “problem”?
Support your investment needs.
Please don’t run out of cash and don’t make math errors.
TEDCO TOP 10 LIST
TEDCO TOP 10 LIST
#10...
Show that you’re an effective communicator.
We aren’t experts in everything – pitch so your grandparents get it!
Get outside help with your pitch…and practice.
Get a stranger to proofread your proposal & presentation.
Questions?
Questions?
