Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 1 Big Idea Competent Team Sufficient Money Good Plan RelentlessExecution And a generous helping of luck…

Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 2 Solve a real problem Solve a focused problem Solve a big problem Solve a hard problem Solve an obvious problem Solve a complete problem Solve a worsening problem

Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 3 A concise statement of the compelling promise that your product or company makes to a set of target customers that is differentiated from available alternatives, and supported by reasons to believe in the promise.

Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 4 Promise Differentiation Support Price Target Audience What’s in it for me?Why is yours better? Why should I believe you? Is this for me? What are my costs of making it useful? Effort required Is it worth it? Risk What might Go wrong?

Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 5 Who are the audiences you are addressing with your idea? What pain points you are addressing for these audiences? What evidence do you have that these pain points are real? What are the current solution approaches? What’s lacking in these approaches? How is your solution approach better? How big is this difference and what is it worth to customers? What’s in it for other stakeholders besides end-customers? Why hasn’t someone else thought of your idea yet? Are you sure nobody has thought of your idea yet? What is proprietary about your idea? What makes your team uniquely qualified to implement your idea?

Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 6 BUILD STUFF Engineering/ Technology SELL STUFF Marketing/Sales RUN THE SHOW Finance/ Administration RAISE MONEY, HIRE TEAM, PROVIDE DIRECTION (CEO) The 7 Deadly Sins:  Hiring based on convenience  Hiring without due diligence  Hiring big-company stars  Hiring the wrong attitude  Hiring poor listeners  Hiring cheap onshore executives  Hiring VP of Sales with no product

Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 7 Is the team leader strong and passionate? Will leader and team attract “A” players? Is the team appropriate for the stage of the company? Has the team worked together before? What are the team’s values and what type of culture will they create? Is there a strong technical leader? Is there a strong marketing leader? Does the team have deep domain or technical expertise? Does the team listen and take criticism in a positive way? Does team have a good blend of “thinkers” and “doers”? If current plan doesn’t work out, will team adapt? Will the founders give up control if that is what the venture demands?

Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 8 You need it as a roadmap You need it to clarify priorities You need it to attract funding It is used as a guide when speed bumps happen It is your company’s & your personal scorecard

Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 9 The planning process is more important than the plan The assumptions are more important than the forecasts Things will never turn out as planned It should be short enough to be readable, long enough to be rigorous

Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 10 Be brief and direct; get to the bottom line quickly Identify what the business is immediately Define the customers quickly and the customer problem clearly Define what’s compelling and unique Describe how you will make money Provide a phased snapshot of your company 12, 24 and 36 months out Describe how you propose to take your product to market Make bottom-up as well as top-down projections Know what 4 to 5 assumptions your plan pivots on Discuss the key risk factors State how much money you will need and how you will use it State your possible exit strategies

Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 11 F&F (Friends and Family) Angel Investors Venture Investors (Series A and onwards) Strategic Investors Late-Stage and Mezzanine Funds Public Markets

Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 12 Put some of your skin in the game Size of the pie wins every time over share of the pie Getting a high valuation early can be fatal Don’t value the company in the angel round Make advisors into angel investors and vice versa More startups die of indigestion than of starvation Venture capital is like synthetic fertilizer – use sparingly and with caution Raise money when you can, not when you need it It will take twice as long and thrice as much work as you think to raise money

Elements of this Presentation are Courtesy of Dr. Mohan Kellogg School of Management 13 Growth vs. Profit –Growth today is worth many times the profits tomorrow Speed vs. Deliberation –Know your speed limit, and don’t let VCs make you exceed it Opportunism vs. Strategy –Start out being opportunistic, but quickly become strategic Service vs. Product –Servicize to learn, then productize to earn