The secret sauce of Silicon Valley - Marco Marinucci, Jul 2011

prepared by:Marco Marinucci ©

IE, June 2011Marco Marinucci

A VISION OF ENTREPRENEURSHIP IN SILICON VALLEY

ON STARTUPS, INNOVATION AND WAVE SURFING

• IE IXMBA [04], MSs EE Uni Genova [93]• Google inc., Strategic Partnerships• Mind the Bridge, founder and CEO• MTB GYM incubator managing partner• Corriere della Sera, contributor

SiliconValley.corriere.it• IE Silicon Valley week

2

Startup Summer School

http://school.mindthebridge.org

• 3 weeks in San Francisco• live and breath with the startups• Pier 38 (~60 startups)• 20 modules• visits @ companies• work on your project or with a startup

prepared by:Marco Marinucci © 3

DO WE CARE ABOUT INNOVATION?

Innovation is about what will be NEXT

“You cannot plan innovation. You cannot plan invention. All you can do is try very hard to be at the right place and be ready.” Eric Schmidt, May 09

prepared by:Marco Marinucci © 4/13

THE “VALLEY”


THE HISTORY OF THE VALLEY


THE (REAL) HISTORY OF THE VALLEY


THE (REAL) HISTORY OF THE VALLEY

1930 1940 1950 1960 1970 1980 1990 2000

WAV

ES O

F IN

NOVA

TION

INNOVATION NETWORKS

INTERNET

PERSONAL COMPUTERS

INTEGRATED CIRCUITS

DEFENSE

Today:25 of Fortune 100Adobe SystemsAMDAgilent TechnologiesApple Inc.Applied MaterialsBusiness ObjectsCisco SystemseBayElectronic ArtsGoogleHewlett-PackardIntelIntuitLSI LogicMaxtorNational SemiconductorNetwork ApplianceNvidiaOracle CorporationSanDiskSeagate TechnologySolectronSymantecSun MicrosystemsYahoo!…

◊ NASA◊

Lockheed

◊ HP (47)

◊ Intel (68)

◊ Kleiner Perkins (72)

◊ Apple (80)

◊ 3Com, Adobe, Cisco

◊ Yahoo, ebay, Google (90s)

?


THE MAIN PILLARS

◊ Is that replicable / portable?

◊ Is it sustainable long-term?

◊ What is the impact of the changing international outlook?

KEY QUESTIONS


SOFT FACTORS

◊ The importance of Dynamism, speed: continuous evolving world

◊ Approach to Risk

◊ Value of Failure (not just a downside but a must-have)

◊ Importance of the Hub: a world of opportunities

◊ Think Big

KEY TO SUCCESS


DOES IT REALLY KICK ASS?

[*Source: Ernest Young Global VC report – 2007]

2003 2004 2005 20060

1

2

3

4

5

6

7

8

9

10

3.6 3.8 3.9 4.1

6.8

8.3 8.59

USAEuropeSilicon Val-ley

2003 2004 2005 20060

500

1,000

1,500

2,000

2,500

3,000

22192328

2422 2454

13731265 1189

867701 767 814 811

US

Europe

Silicon Valley

Annual VC Investment (B US$) Number of Deals

0.028 62

Italy• Globalization• Moving to

extremes


WHAT’S HOT?

Top Industry Segments - Silicon Valley 2006

Rank Segment Amount (US$ M)

Rounds

1 Software 2,300 2612 Communications 1,176 793 Biopharmaceuticals 1,031 544 Semiconductors 1,018 715 Information Services 993 1286 Medical Devices 923 777 Electronics 540 408 Cons/Bus Services 383 429 Energy 233 1810 Cons/Bus Products 75 9

Amount (M $)

Oak Investment Partners 2,560New Enterprise Associates 2,500Polaris Venture Partners 1,000

US - Top VC funds Raised 2006

Amount (M EU)

Scottish Equity Partners 235Northzone Ventures 175Life Sciences Partners BV 150

EU - Top VC funds Raised 2006

[*Source: Ernest Young Global VC report – 2007]


VCS IMMUNE FROM CRISIS? BULLSHIT! *TECHCRUNCH

[*Source: TechCrunch Apri 09 from PriceWaterHouseCoopers]


INVESTMENT TYPES

>$ 100K• 1-3 Years

>$ 2M • 3-7 Years

IPO

>$ 10M • 3-7 Years


THE FUNDING DECISION

Founders’ capitalSavings

Credit cards

LoansAcconts receivableStrategic PartnersRetained earnings

VC firmsCorporate VC

Private placementInvestment banking

Public markets

Capital from:Family/friends

AngelsEarly stage VC

Bootstrapping Equity Financing

Early sources

Later sources


THE VENTURE CAPITALIST


INVESTMENT STRATEGY

IDEA DEVELOPMENT BETA CUSTOMERS EXPANSION MARKET SHARE

12-24 months

3 months

3-6 months 12-18 months

12-24 months

Vision/ Product Focus Customer / Market Share Focus

M&A

M&A Valuation

Cumulative Investment

Management Focus

IPO

Medium Risk High Risk

Medium Risk Low Risk

Investment

Focus


Limited Partners

VC Firm (General Partners)

Startup Companies

IPO/M&A

Fund Fund Fund

Exit

Distributions Fundraising Commitments

Investment DisbursementsProceeds

VENTURE CAPITAL GENERAL INVESTMENT PROCESSVENTURE CAPITAL GENERAL INVESTMENT PROCESS


AGREEMENT VARIABLES AND CONTROL MECHANISMS


VENTURE CAPITAL COMPENSATION STRUCTURE


READ THOSE OR YOU’RE OUT

WWW.TECHCRUNCH.COMWWW.LINKEDIN.COMWWW.VALLEYWAG.COMWWW.SILICONVALLEY.COMWWW.BOINGBOING.NETwww.Digg.comwww.startupdigest.comnews.ycombinator.com/www.thefunded.com

http://www.Techcrunch.com/


http://www.Linkedin.com/

http://www.Valleywag.com/

http://www.Valleywag.com/

http://www.Siliconvalley.com/

http://www.Siliconvalley.com/

http://www.BoingBoing.net/

http://www.BoingBoing.net/

http://www.Digg.com/

http://www.digg.com/






READ THOSE OR YOU’RE OUT

WWW.BAIA-NETWORK.COMWWW.LOBBYINNOVAZIONE.ITSILICONVALLEY.CORRIERE.ITWWW.ITALIANIDIFRONTIERA.COMWWW.WORKINGCAPITAL.TELECOMITALIA.IT

FACEBOOK: ITALIAN STARTUP SCENERIDE THE WAVE TO SFMIND THE BRIDGE GYM


http://www.lobbyinnovazione.it/







SUCCESSFUL LANDINGS

1. Find a dedicated mentor (soon!)

2. Set your quarterly objectives

3. Use the network4. Customers before funding5. Get local (advisory

committee)6. Learn from who disagrees


(5) LESSONS FROM GOOGLE

1. the team is all (almost)

2. healthy disregard for the impossible

3. big problems are better than small ones

4. users first

5. don’t pay attention to the VC bandwagon


RAISING MONEY TODAY (@#$!) IN SV

are you not local

how many exits again?

don’t show me the buyer (don’t IPO me…)

haven’t jumped yet

DON’T TALK TO ME IF YOU…


WHY NOW?

talent abounds

from scarcity comes clarity

innovation comes from hunger

startup cost ~0

IT’S THE BEST OPPORTUNITY


HOW TO PITCH A SILICON VALLEY VC

Books• The Art of the start - Guy Kawasaki

• Communicating the American Way: A Guide to Business Communications in the U.S. by Blendstrup, Ghisini Amazon.com

• The Home Run Hitter's Guide to Fundraising: Happy About Raising Capital without Pitching by Dan Sapp Amazon.com

• Presenting to Win: The Art of Telling Your Story by Jerry Weissman Amazon.com

Videos• Guy Kawasaki: 10-20-30 rule

WWW• How to Present to VCs: http://www.hcp.com/advice • Stanford Ecorner:http://ecorner.stanford.edu/

popularVideos.html

A FEW RESOURCES

http://www.amazon.com/dp/1600050735?tag=borsetti01-20

http://www.amazon.com/dp/160005059X?tag=borsetti01-20

http://www.amazon.com/dp/0137144172?tag=borsetti01-20

http://www.youtube.com/watch?v=liQLdRk0Ziw&feature=related

http://www.hcp.com/advice

http://ecorner.stanford.edu/popularVideos.html






INSTRUCTIONS FOR USE

Unique exposure, get the best out of it Get prepared in advance, have something interesting to say

Be part of the network: you are the contacts that you have

Nurture your contacts: take and give

SUGGESTED TAKE-AWAYS


Q&A

ContactEmail: [email protected]

mailto:[email protected]

The secret sauce of Silicon Valley - Marco Marinucci, Jul 2011

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Transcript of The secret sauce of Silicon Valley - Marco Marinucci, Jul 2011