By Nick Ducoff

@nickducoffhttp://nick.vc

FUNDING A STARTUP

PRESENTATION TO VENTURE FELLOWS

FEBRUARY 16, 2011

A Little Background On MeChoose Your Own AdventureBootstrappingFFF (Friends, Family, Fools)Angel FinancingVenture CapitalHow We Did It At InfochimpsWhat You Can DoQ & A

AGENDA

CollegeBoxes Raised $1 million in friends and family Angel investor and advisor Sold assets to Store to Door

JDspace Bootstrapped CEO/Co-Founder Sold some assets to Small World Labs

Andrews Kurth Represented 25 startups in raising over $250 million* *1 outlier, did a $100 million Series A raise during the bubble

Infochimps Raised $375,000 in angel financing and $1.25 million in VC CEO/Co-Founder

A LITTLE BACKGROUND ON ME

Bootstrap

Can

Do it!

Can’t

FFF Angel VC

CHOOSE YOUR OWN ADVENTURE

Quit!

You don’t need money No salaries No offi ce Free(mium) software Cloud hosting Zero marketing spend

Oh, you really do need money? Consulting on the side, but not the other way around Vendor financing Receivables financing Credit cards and bank debt

Can you cash flow before you go broke? If not, quit now If you are stubborn, go to next slide

BOOTSTRAPPING

Who is the fool? If you think your [____] is annoying now… No expectation of being repaid is a myth You have to live with these people the rest of your life

Make sure they are accredited $1 million in net assets excluding residence; or $200K/yr for single filer or $300K/year for joint filers If not, rescission, which could come out of your

pocket!

http://www.youtube.com/watch?v=hAuSTQUa3tM (A Bronx Tale clip NSFW)

FFF (FRIENDS, FAMILY, FOOLS)

Distinguished from FFF Regularly make investments in private companiesMight provide additional value; more than dumb money Angels with LPs (“super angels”) are really more like VCs

Where are these angels? AngelList (http://angel.co) Your network! Ask for advice, not money!

Raising $ from respected angels signals VCs Raise $ in convertible debt so it is nice and clean for VCs Don’t even try raising VC if you can’t raise angel financing

ANGEL FINANCING

Be self aware, are you really VC fundable?Raising VC does not come without costsRaising VC is easy if you’ve built and sold

a company for millions of dollarsOh, you haven’t?

Get the right intro Start local, but go west Appear bigger than you are Sell your stock, not your product Get to a partner at the right time

VENTURE CAPITAL

Angels

John Hime• I did work for him

at AK

Stage 1 Capital• Principal was a

mentor and is now a friend

Infocore Ventures• Principal was CEO

of CollegeBoxes

Bill Boebel (VP Strategy Rackspace $RAX)• Intro by Tier 1 AUS

VC

HOW WE DID IT AT INFOCHIMPS

VCsDFJ Mercury• Met principals at

HOU startup meetups

Tier 1 AUS VC• Principal was on

board of one of my clients

Tier 1 SF VC• Intro from CEO of

portfolio company

Tier 1 SF VC• Met principal at a

tech conference

Tier 2 CO VC• Intro from Tier 1

AUS VC

Join QuoraSubscribe to TechCrunch RSSAttend startup meetupsAttend SXSWiWork at a startupGet domain expertise in somethingBuild something small (2taps.com)Start a personal board of advisors

WHAT YOU CAN DO

Q & A