Surviving entrepreneurship, Funding

1. Start-up Funding
Abhijeet Bhandari

2. The Three Phases
Pre-funding
Funding
Post-funding

3. Pre-funding: The Jungle rule!
Survival of the Fittest

4. Pre-funding: How to survive?
If you survive, then only you will thrive?
Keep Walking!

5. Survival Mantras
• Asset Light/Little Liabilities
• Strict financial discipline: Personal & Company
• Consulting/Teaching
• Factoring/Line of Credit
• On-cloud services
• Free: Hangout, Asana, Teamviewer
• Resource sharing: Co-working space, lawyers,
accountants, etc
• If your father is poor, its your fate..if your father-in-
law is poor, its your stupidity...

6. Survival Mantras
• Partnerships
– Real estate players
– Customer as partner (for initial funding)
– Customer as partner (for building a new product) –
Starbucks
– Employees
– Vendors

7. Funding Stages
• Personal Reputation
• People believe in you
FFFs
• Small Capital
• Mentoring & Support
Accelerators
• Belief in your idea
• Initial Traction
Angels
• First Institutional Investor
• Traction & Revenues
VCs
• Large deal size
• Typically established businessesPEs
Size
1-10 L
5-50 L
20-500 L
5-25 cr
25+ cr

8. Accelerators/Incubators
• AngelPrime
• Kyron
• Freemont Partners
• Veddis Ventures
• GSF Accelerator
• Morpheus
• Myfirstcheque
• TLabs

9. Accelerators/Incubators
• Microsoft/Google Ventures
• Corporate Incubators: Target, TechM
• CIIE, IIMA
• 5ideas, Pearl Uppal
• Government Incubators: In about 34 cities across
India
• International
– JFDI.Asia; Israel
– 500startups: Dave Mcclure
– Y Combinator; RocketInternet; Startup Chile

10. Angel Networks
• Mumbai Angels
• Hyderabad Angels
• Chennai Angels
• East Angels
• Harvard Angels
• Bangalore Angels
• Saarthi Angels
• Ah Ventures!
• Calcutta Angels
• Lets Venture
• Seeders

11. Venture Capitalists
• Nexus Ventures
• Yournest venture fund
• Blume ventures
• Seedfund
• India Internet Fund

12. Other Funding Sources
• Government Grants
– Department of Science & Technology (DST)
– Technology Development Board
– National Skill Development Corporation (NSDC)
• SIDBI Startup Assistance Scheme
• Venture Debt: SVB India
Finance/Intelligrow/Villgrow
• Cash credit & bank overdraft

13. Elevator Pitches
• The Pixar Pitch: Where the Pitch starts from a
Once Upon A Time kind of story. (Eg: Toy Story).
The audience can easily visualise your words and
relate to them
• E-mailers Pitch: Which incites curiosity in the
audience and investors. Starts with a
communicative tone. Personal, WIIFH, PoC
• Questions Pitch: Where the Pitch starts with a
pointed question. Eg: How many of you have ever
got stuck in traffic…

14. Most asked questions
• What is the problem the startup is addressing?
• What is your solution to the problem?
• How are you going to acquire customers?
• What is the cost of acquisition?
• What is the life-time value of a customer?
• What's your plan to beat the competition ? What's
the USP of the company?
• What's your vision for the business?

15. The DOs
• How to multiple their money 5 times in 3-4 years?
• Your start-up definition
• What’s your story?
• Can they feel the pain? Can they be your
customer?
• Investors are sensible people too!

16. The DON’Ts
• Top-down vs bottom-up approach?
• Divided focus?
• Sell dreams but don’t be in dreams!
• Don’t believe that excel is reality!

17. Key Numbers
• The Asked investment
• Product / Service Pricing
• Time to Break-even
• The graph of declining costs
• The time the amount will last

18. Revenues & Expenses

19. Some Tips!
• Build a relationship with investors
• Speak to Alumni/Friends/Linkedin
• Don’t lose focus from business: Keep bootstrapping
• Valuation: A perspective and the stories!

20. Some Views…
• We look for strong founding team, key
differentiator, and a fundamentally large
addressable market in any elevator pitch, Accel
Partners’ Prakash
• OnlinePrasad, raised Rs 50 lakh from serial
entrepreneur Krishnan Ganesh over a 10-minute
elevator pitch
• IIT-Kanpur alumni Sahil Baghla raised Rs 1.5 crore
for his gifting portal BlueGape from 12 global
investors, without even meeting them from Lets
Venture

21. Some Views…
• Bakshi, 30, whose company makes laptop bags
that can charge phones and tablets, when kept in
the sunlight. "Lumos solved a need that I have"
Rajan Anandan

22. Thank You!