My Reddit AMA on Crowd-Funding

Reddit LogoAt the invitation of The Capital Network, I did my first Reddit Ask Me Anything. It was pretty fun. To do an AMA, you hang out for a specified time and anyone on the internet machine can ask you a question. Mine was all about crowd-funding – the new rules, issues, questions, concerns. Some good nuggets in there. You can read through the Q&A here. Or if you are based in the Boston area and want more detail, you can check out the TCN event it was promoting here.

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If you enjoyed this post, you might enjoy my other posts on Angel InvestingCrowd SourcingEntrepreneurship.
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What’s Your Story? Pitch Deck Flow

Oirase Stream

Augustin Rafael Reyes

Competent entrepreneurs can explain their company in terms of what the product does. Good entrepreneurs can explain their company in terms of their customer and their market. Funded entrepreneurs can pitch their company in terms that an investor can relate to.

For most entrepreneurs, it’s not easy or intuitive to put the investor version of the story together. They can talk a blue streak about the product, the customer, maybe the market. But they cannot pitch the business as a good investment in a way the investor can quickly grab onto.
Turns out, there is an easy formula that works nearly universally. The key to this formula is that it covers all the required subjects, but strings them together into a coherent and engaging narrative flow. Once you grok the formula, it all kind of clicks and you suddenly understand what it is you are trying to convey. From then on, it’s easy. (Note in addition to talking about the subjects here, I have also discussed why you should sweat your executive summary here, talked about the importance of keeping a pitch deck lean here, and about the importance of practicing your delivery here.)

[Read more…]

An Angel’s Thanksgiving

Adapted from an article originally published by the author in Inc. Magazine.

Entrepreneurs, let’s be honest: nothing inspires gratitude in the heart of an investor quite like a good, timely exit. Exit liquidity, after all, is the necessary force that makes our collective world go round. But that doesn’t mean Thank youangels don’t appreciate all the other quirky, sometimes fleeting, but always satisfying benefits of working with you along the way. Fact is, we are nothing without you.

“If you are really thankful, what do you do? You share.” W. Clement Stone
“Thanksgiving, after all, is a word of action.” W.J. Cameron
“On Thanksgiving Day we acknowledge our dependence.” William Jennings Bryan

So during this season of thankfulness, let’s take a moment to consider what angels are thankful to you for. We are thankful for: [Read more…]

Fool Born Every Minute – So You Want To Be An Entrepreneur (Inc. Column)

I’ve been contributing a column at Inc. Magazine devoted to the topic of de-mystifying angels and the early-stage investing process.  A recent piece was a list of key books every would-be and new entrepreneur should read.

booksFool Born Every Minute (So You Think You Want to Be An Entrepreneur?)

Could you be an entrepreneur? A start-to-finish reading list for entrepreneurs and people who think they want to be.

Entrepreneurship has come a long way toward being a better-understood and accessible way of life. But it will never be completely mainstream, because it’s not for everyone. Consider the temperament and skills required. Entrepreneurs need a broad skillset and, equally important, a high degree of awareness about their weaknesses. It’s a lonely, difficult, risky, frustrating, and sometimes scary path to choose.

Do you have what it takes? To help you figure that out, I’ve assembled a list of critical reading every would-be entrepreneur should digest. The list is not comprehensive–I have purposely tried to make it as short as possible. This core set of thoughtful materials will help immensely with decision making about your path and execution of it, if you decide to pursue it.

What’s It Like? What Does It Take?

The first question to resolve is whether you have it in you. Heart, Smarts, Guts, and Luck by Zappos founder Tony Hsieh (et al) is a very readable exploration of the psychology and temperament of the successful entrepreneur. A good resource for understanding the massive scope of skills necessary is the simply titled Entrepreneurship by William D. Bygrave and Andrew Zacharakis. This book will give you a nuts-and-bolts overview of virtually all aspects of the process (and will serve as a useful desk reference later). If 90 percent of the material in Entrepreneurship seems uninteresting or overwhelming, it’s time to write a résumé.

There Is No I in Team

It has been said that all startup problems are people problems…

[Surf over to Inc. Magazine to finish the story.]

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If you enjoyed this post, you might enjoy my other posts on Angel InvestingEntrepreneurshipVideo Interview Series, or my recent curated links you might have missed on: Big Tech & MobileInternet, IoT, Social, CybersecurityInvesting & Entrepreneurship.

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7 Reasons Why Angel Investing Became Serious Finance (Inc. Column)

I’ve been contributing a column at Inc. Magazine devoted to the topic of de-mystifying angels and the early-stage investing process.  My first piece was on the seismic forces which have slowly but profoundly re-shaped the early stage investing landscape.

pan_WallStreet_373617 Reasons Why Angel Investing Became Serious Finance

Discover the forces converging to make angel investment a serious source of capital for savvy, high-growth focused entrepreneurs.

Why does it seem like angel investing received more press coverage in the last few years than in its first few hundred years combined? Private investing has suddenly become part of mainstream consciousness.

What’s going on? It’s more than just an academic question. As an active angel and co-head of one of the largest and busiest U.S. angel groups, I’ve watched and charted these market changes since the early 1990s.

In just a couple decades a handful of seismic forces affecting early-stage financing have combined to make angel investing a very different business. The result? Angel investors have become a serious source of capital for savvy high-growth entrepreneurs.

Seven key trends have fueled this radical transformation.

[Surf over to Inc. Magazine to finish the story.]

Comments, questions or reactions to this post? Leave a note below and I will respond to your questions.
If you enjoyed this post, you might enjoy my other posts on Angel InvestingEntrepreneurshipVideo Interview Series, or my recent curated links you might have missed on: Big Tech & MobileInternet, IoT, Social, CybersecurityInvesting & Entrepreneurship.

Subscribe – To get an automatic feed of all future posts subscribe to the RSS feed here, or to receive them via email enter your address in the box in the upper right or go here and enter your email address in the box in the upper right. You can also follow me on Twitter @cmirabile and on Google+.

Pitch Deck Basics

SlideDeckCreating and delivering a great pitch requires both using the right building blocks and putting them together properly. I cover the more advanced topic of crafting an effective deck here, but first you need to understand the building blocks. (If executive summaries are your hang-up, I dealt with them here, and I’ve talked about the importance of keeping a pitch deck lean here, and about the importance of practicing your delivery here.)

Reminder – You Need Two Versions

Before we do anything, we need to be clear about one thing: you should have two different versions of your deck – one that has lots of white space and relatively few words that you use as a back-drop to a live presentation, and one that has enough words that it can stand on its own if you need to email it to someone. Never email the first type or present from the second type. And don’t try to get by on just one version. Both mistakes are going to lead to bad results.

MetaData

Probably the single most important data to include in your deck is your contact info – list every single means of getting in touch with you. Sounds like a given, but the stories I could tell you… Second helpful thing to consider is a small compact box somewhere with some basic metadata about the company: website, stage of development, capital raised, capital seeking, lawyers, accountants, key investors, date founded.  That meta data can be at the end, but it is pretty handy right at the beginning in a quick facts slide or quick facts box.

Main Contents of Your Deck

What does the deck need  to have in it? The deck should talk about the following items – no more, no less. Any order you think makes sense. And it should cover them in a 10-15 slide deck that can be delivered in 10- 15 minutes:

1. Customer Problem

  • description of customer pain
  • how you solve it – concept & key elements

2. Overview of your Product/Solution

  • what you do & for whom
  • why it’s compelling

3. Key Players:

  • founders & key team members
  • key advisors
  • industry backgrounds, expertise

4. Market Opportunity:

  • market size
  • market growth characteristics
  • market segmentation
  • why you can grow faster than the market and the competition

5. Competitive Landscape

  • current and future competitors
  • detailed chart on competitive feature sets
  • summary of your sustainable competitive advantages

6. Go-To-Market Strategy

  • how you will sell your product/solution

7. Stage of Development & Key Milestones

  • product development
  • customer acquisition
  • partner relationships

8. Critical Risks & Challenges

  • what can go wrong and how you plan to manage it

9. Financial Projections

  • five years out (and you must show Yr5 mid-case, worst case and best case with key assumptions)
  • how much time & money it will take to get to cash flow break-even

10. Exit Options

  • categories of likely buyers
  • rationales
  • list of specific likely buyers
  • comparables with valuation multiples

11. Funding Requirements

  • how much you presently seek
  • how much runway it will give you
  • what you are going to use it for
  • what milestones it will allow you to achieve
  • why your company will be more valuable when you reach each milestone

Beyond that, you really don’t want or need much. You can add an appendix covering some details on certain subjects you want to have handy in case you get asked, but that is about it.  Trying to do much more is not going to make your pitch more effective, it is going to merely draw it out and increase the likelihood that you will not get through it, which can be the kiss of death. Remember details can be drawn out in the Q&A and during subsequent due diligence, so it is not appropriate to go into depth in the pitch; instead you should focus on covering all of the key elements so you get the next meeting.

Couple Final Notes on Mechanical Construction and Delivery

Do not use complicated animations or builds in your deck – they make it very hard to go backwards if you need to. Do not build in any internet-dependent content such as demos or videos – the projecting machine may not be connected to the internet and even if it does have a nice fast connection it may not have a player for your codec or there may be no provision for audio. You should also plan ahead to avoid last minute changes to your deck – planning to “swap in a newer draft” when you arrive can be a mess – AV fumbling while everyone waits for you makes an unprofessional first impression and wastes your presentation time.

You may want to avoid exotic presentation programs like Prezi. Even PowerPoint can be pretty buggy on some machines. Consider converting your deck into PDF format and sending both that and PPT, but check the PDF conversion before sending to make sure it didn’t introduce any embarrassing font substitutions or wacky line breaks. Keep it simple – this pitch is about you as much as anything. Do not plan to spend time on product demos – perhaps a couple screenshots if necessary to understand the product, but you do not have time for demos. Plan for the worst in terms of screen size: do not use any small font sizes – keep it large and legible. And finally, bring multiple copies of your presentation different memory sticks, just in case, as well as your own remote control – one you are familiar with. If it makes more sense to use one that is provided, get familiar with it before starting so you don’t get flustered and make a hash out of your presentation.

Now you can go read about the crafting of an effective and compelling deck.

Comments, questions or reactions to this post? Leave a note below and I will respond to your questions.
If you enjoyed this post, you might enjoy my other posts on Angel InvestingCommunication,  Entrepreneurship, Video Interview Series, or my recent curated links you might have missed on:  Investing & Entrepreneurship.

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Radio Entrepreneurs Interview

I recently did an interview with my friend Jeffrey Davis on his fast-growing business radio show Radio Entrepreneurs.  We talked about the entrepreneurship in Boston, the angel investing scene, Launchpad Venture Group, and the future of Boston’s innovation ecosystem.  You can listen below (email readers can grab it here).

Comments, questions or reactions to this post? Leave a note below and I will respond to your questions.
If you enjoyed this post, you might enjoy my other posts on Angel InvestingEntrepreneurship, or Recent curated links you might have missed on: Investing & Entrepreneurship.

Subscribe – To get an automatic feed of all future posts subscribe to the RSS feed here, or to receive them via email enter your address in the box in the upper right or go here and enter your email address in the box in the upper right. You can also follow me on Twitter @cmirabile and on Google+.

Dan Primack on Angel Investing

Ditch DiggingWe’re all investors, but we’re no angels

Dan Primack recently wrote a good piece on how hard angel investing is. You can find most of the full article here, but I have pulled out some key points below. It is mostly a re-hash of the Kauffman study in honor of the new general solicitation rules, but some of his points bear repeating: investing in start-ups is work. You may lose money. You will need to do due diligence. You will need to invest in a lot of companies to do well.

Many, many experienced angels can tell you that you can make money at, it but none will tell you it is easy or that it can be done by mouse-clicking on AngelList. Here’s more from Dan: [Read more…]

Launchpad 2013 Year In Review

Launchpad Logo 200px Wide

Launchpad Venture Group had a very fun and very busy 2013. We are already looking forward to 2014, but before 2013 is completely set aside, let’s do a quick recap of some key highlights & milestones, by the numbers: [Read more…]

Angel Group Screening Practices Data

Best Practices in ScreeningI recently did a deck and moderated a talk at the Angel Capital Association Leadership Conference in Boston about what different established angel groups are doing on screening deal flow – best practices, tools, sources, staffing, fees, how group size affects it, etc. Lots of data (based on a large survey of almost 100 angel groups, mostly in the US) – some of it is pretty interesting.  I have been asked repeatedly to share the slides, so here they are (email readers can access them here).

Comments, questions or reactions to this post? Leave a note below and I will respond to your questions.
If you enjoyed this post, you might enjoy: Some Perspective on SEC Rule 506 General SolicitationFunding Startups (Panel Video)Swimming Against the Tide (Angel Investing)Nailing The One Minute PitchStart-Up Marketing SeriesCustomer Crowdfunding: Not So Fast Entrepreneurs (Again!)Constructing a PitchPick Your Angel Investors Wisely (David Hornik)Why Angels Chase ElectronsDelusional EconomicsLoch Ness, Unicorns & The First-Mover AdvantageDoes This Slide Deck Make Me Look Fat?,  The Long Road to Instant SuccessTop Angel Investors in New EnglandCustomer Crowdfunding: Not So Fast, EntrepreneursAngel Video Interview Series,  Thoughts on CrowdfundingEntrepreneur at Work: Caine’s Arcade,  The Crowdfunding Interview (Frank Peters Show), Pattern Matching Can Cause BlindspotsGetting Off The Ground; Early Formation EconomicsPitch Clinic at MassChallenge (Video)Are Entrepreneurs Wild Risk-Takers?Top 20 Dos & Don’ts with Angel Groups & Early Stage FinancingWhat I Look For In An EntrepreneurThe OverturePick Your Founder/Co-Investors Carefully & Reflections on the Nature of EntrepreneursShould I Wait For A Technical Co-Founder?When Do You Need My Slide Deck?20 Bootstrapping Ideas
Subscribe – To get an automatic feed of all future posts subscribe to the RSS feed here, or to receive them via email enter your address in the box in the upper right or go here and enter your email address in the box in the upper right. You can also follow me on Twitter @cmirabile and on Google+.