an introduction to entrepreneurship. from startup ...ecoxs02.eco.unipmn.it › eventi › 2010 ›...

Università degli Studi Piemonte OrientaleNovara, 11 Maggio

AN INTRODUCTION TO ENTREPRENEURSHIP.

FROM STARTUP COMPANIES TO FUND RAISING

With the support of:

Mind the Bridge ItalyTour 2010Mind the Bridge ItalyTour 2010

Agenda

2

Agenda

3

STARTUP’S LIFE

Team

Passion

AdrenalineCaution

Speed

INGREDIENTS FOR A STARTUP

5

WHAT IS AN ENTREPRENEUR

6

WHY ?

MANAGER VS ENTREPRENEUR

8

Agenda

9

10

THE HISTORY OF THE VALLEY

11/13

THE (REAL) HISTORY OF THE VALLEY

12

THE (REAL) HISTORY OF THE VALLEY

1930 1940 1950 1960 1970 1980 1990 2000

WAVES OF

INNOVATION

INNOVATION NETWO

RKS

INTERNET

PERSONAL COMPUTERS

INTEGRATED CIRCUITS

DEFENSE

Today:25 of Fortune 100

Adobe 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

13

14

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

15

(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

16

DO YOU KNOW ?

SQUARE UP

The world’s largest cross-platform mobile open source project

750 employees in 3 years

21-year-old

>400 ml users today

15 bl $ valuation

Agenda

17

The Big Idea!!!

18

… But after the Idea, It’s All About Execution …

RESOURCES($, supply chain, …)

ENTREPRENEURIAL

TEAM

OPPORTUNITY(How big is ....)

BUSINESS MODEL(Long term sustenability)

STRATEGY(mktg, sales, ...)

THE BUSINESS PLAN

19

WHO READS A BUSINESS PLAN?

20

hLooks to see who sent it15 sec

hAnalyzes key aspectssectorlocationinvestment required60 sec

hReads the plan15 min

hDecides whether or notto request a formal presentation

10min

Total: 26 min 15 sec

WHAT DOES AN INVESTOR DO WITH A BUSINESS PLAN?

21

What investors want to see

� They have to see:

� Realistic forecasts based, as far as possible, in fact

� Monthly / quarterly projections for at least 1 year

� They do not wish to see:

� Plans full of glowing references to a prosperous, but ill-defined future

� Unsupported projections or unrealistically inflated figures

BUSINESS PLAN? OK VS KO

22

GOOD AND BAD BUSINESS PLANS

23

THE QUESTIONS EVERY ENTREPRENEUR MUST ANSWER

24

THE BP OUTLINE

25

TALKING $$$

26

Agenda

27

INVESTMENT TYPES

28

Business Angels

Venture capital

THE ANGEL INVESTOR

29

ANGEL TYPOLOGIES

RELEVANT

ENTREPRENEURIAL

EXPERIENCE

RELEVANT INDUSTRY

EXPERIENCE

High

High

Low

Low

30

THE VENTURE CAPITALIST

31

WHY VENTURE CAPITAL ?

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

33

VENTURE CAPITAL INVESTMENTS SLOWED DOWN, BUT US STILLS LEADS THE WAY

34

35

WHERE IS ITALY ?

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

Annual VC Investment (B US$)Annual VC Investment (B US$) Number of DealsNumber of Deals

0.02862

Italy

• Globalization• Moving to extremes

Agenda

36

37

� bridging opportunities of the Silicon Valley with Italian talent

� associating mentors and role models

� professionalizing the business planning skills

� using and building the network

� “give back” to build a bigger pie

Mission:

to promote a new Italian entrepreneurial ecosystem that is:

ETHICAL, HIGHLY PROFESSIONAL, INTERNATIONALLY FOCUSED,

EXCELLENCE DRIVEN

CO

NN

EC

TIN

G T

ALE

NT

MIND THE BRIDGE FOUNDATION

38

MIND THE BRIDGE FOUNDATION

� Nurturing the future Italian Googles (MtB Roadshows)

� Selecting the best of breed (Annual MtB Business Plan

Competition & MtB Venture Camp)

� Providing training & education to the new generation of

entrepreneurs (MtB Start-up School)

� Hosting&mentoring the most promising startups in the Silicon

Valley (MtB Gym)

� Pitching Silicon Valley investors / partners (MtB Gran Finale

event)

Model:funded by foundations/companies/private sector/donors

not government

partnering with the most relevant actors

INDEPENDENT

CO

NN

EC

TIN

G T

ALE

NT

39

MTB BUSINESS PLAN COMPETITION

� Selection of most promising BP by a top notch Selection

Committee

� Association of Mentors and training modules

� 2 days Venture Camp event (fall)

� Hosting in the earth of Silicon Valley (GYM)

� Road Show week in Silicon Valley

� Gran Finale event –pitching Silicon Valley investors/partners

BU

SIN

ES

S P

LAN

CO

MP

ET

ITIO

N

2010: Applications are open until JULY

2009 SELECTED START-UPS

Revolutionary antenna system (Milano)

Wi-Fi-derived solutions (Milano and Boston)

Comprehensive non-invasive solution for both vertebral

fractures and bone strenght assessment (Lecce)

Solution to update any digital information (Sassari)

Social-network which allow users to create music through the

web (Treviso)

Social marketplace for travel, where experts can provide users

with information and personalized offers (Milano)

Virtual and Augmented Reality technology (Pisa) 40

THE OPPORTUNITY FROM CARIPLO FOUNDATION

� Project: “Educazione all’imprenditorialità internazionale: dalla

creazione di impresa alla raccolta di capitali”

� Goal: spread international entrepreneurship in Lombardy

� Lead: CrESIT, Insubria University

� Partners:

�Cibie, University of Pavia

�Fondazione Politecnico

�Mind the Bridge Foundation

With the support of:

41

HOW DOES IT WORK? 2 SEPARATE FUNNELS

42

HOW DOES IT WORK? THE TIMELINE

43

44

THANK YOU FOR YOUR

ATTENTION

Questions & Answers

Contacts

Giuseppe De Giorgi degiorgi@ai.polimi.it

Alberto Onetti info@mindthebridge.org

www.mindthebridge.org

www.ai.polimi.it

www.cresit.it

USEFUL LINKS:

www.mindthebridge.org

http://siliconvalley.corriere.it/

BLOGS:

Facebook: Mind the Bridge - Connecting Talent

Twitter: aonetti

SOCIAL MEDIA:

45

APPENDIX

46

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…

THE FUNDING DECISION

Founders’ capital

Savings

Credit cards

Founders’ capital

Savings

Credit cards

Loans

Acconts receivable

Strategic Partners

Retained earnings

Loans

Acconts receivable

Strategic Partners

Retained earnings

VC firms

Corporate VC

Private placement

Investment banking

Public markets

VC firms

Corporate VC

Private placement

Investment banking

Public markets

Capital from:

Family/friends

Angels

Early stage VC

Capital from:

Family/friends

Angels

Early stage VC

Bootstrapping Equity Financing

Early sources

Later sources

47

THE VENTURE CAPITALIST

48

Limited PartnersLimited Partners

VC Firm (General Partners)VC Firm (General Partners)

Startup CompaniesStartup Companies

IPO/M&AIPO/M&A

FundFund FundFund FundFund

Exit

Distributions Fundraising Commitments

Investment DisbursementsProceeds

VENTURE CAPITAL GENERAL INVESTMENT PROCESS

49

AGREEMENT VARIABLES AND CONTROL MECHANISMS

50

VENTURE CAPITAL COMPENSATION STRUCTURE

51

52

SILICON VALLEY: DOES IT REALLY KICK ASS?

[*Source: PwC– 2009]

53

WHAT’S HOT?

Top Industry Segments - Silicon Valley 2006

Rank Segment Amount

(US$ M)

Rounds

1 Software 2,300 261

2 Communications 1,176 79

3 Biopharmaceuticals 1,031 54

4 Semiconductors 1,018 71

5 Information Services 993 128

6 Medical Devices 923 77

7 Electronics 540 40

8 Cons/Bus Services 383 42

9 Energy 233 18

10 Cons/Bus Products 75 9

Top Industry Segments - Silicon Valley 2006

Rank Segment Amount

(US$ M)

Rounds

1 Software 2,300 261

2 Communications 1,176 79

3 Biopharmaceuticals 1,031 54

4 Semiconductors 1,018 71

5 Information Services 993 128

6 Medical Devices 923 77

7 Electronics 540 40

8 Cons/Bus Services 383 42

9 Energy 233 18

10 Cons/Bus Products 75 9

Amount

(M $)

Oak Investment Partners 2,560

New Enterprise Associates 2,500

Polaris Venture Partners 1,000

US - Top VC funds Raised 2006 Amount

(M $)

Oak Investment Partners 2,560

New Enterprise Associates 2,500

Polaris Venture Partners 1,000

US - Top VC funds Raised 2006

Amount

(M EU)

Scottish Equity Partners 235

Northzone Ventures 175

Life Sciences Partners BV 150

EU - Top VC funds Raised

2006

Amount

(M EU)

Scottish Equity Partners 235

Northzone Ventures 175

Life Sciences Partners BV 150

EU - Top VC funds Raised

2006

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

54

WHY NOW?

talent abounds

from scarcity comes clarity

innovation comes from hunger

startup cost ~0

IT’S THE BEST OPPORTUNITY

DOCUMENT:DOCUMENT:

••IDENTIFICATIONIDENTIFICATION••DESCRIPTIONDESCRIPTION OF A BUSINESS OPPORTUNITYOF A BUSINESS OPPORTUNITY••ANALYSISANALYSIS

DEVELOPMENT:DEVELOPMENT:

hhSTRATEGIES + PROCEDURES TO CONVERT A BUSINESS STRATEGIES + PROCEDURES TO CONVERT A BUSINESS

OPPORTUNITY INTO OPPORTUNITY INTO A SPECIFIC BUSINESS PROJECTA SPECIFIC BUSINESS PROJECT

FOR ESTABLISHED COMPANIES:FOR ESTABLISHED COMPANIES:

GROWTHGROWTH

DIVERSIFICATIONDIVERSIFICATIONFROM THE CORE ACTIVITYFROM THE CORE ACTIVITY

WHAT IS A BUSINESS PLAN?

55