session 9 fall 2014
TRANSCRIPT
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Milestones
The Deck
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Part 1 – Milestones (proof of
concept)
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What is the biggest barrier for an investor to
invest?
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Milestones?
• It’s about proof to validate the earlier than
stable revenues or growth
• A milestone should reduce
market/customer, tech or financial risk
significantly
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Think Big – but break it down
We are Swedish!!
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Understand the different requirements and
consequences
P/S-fit
P/M-fit
MVP
Growth
Verifieringsbidrag
Customer
”Utlysningar”
A-rounds
Big VC’s
Pre-seed
Incubators
Family office
Angels
Almi
Seed
Angels
Small VC’s
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Type of milestones?
• Qualitative
– Signed partner
agreement
– Working MVP
– Proven technology
– LOI
– Problem validated
– …
• Quantitative
– 1000 sign-ups
– 1000 active users
– 10 paying customers
– 10% churn
– CAC < LTV
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What is not a good milestone
or proof of concept?
• An article in Techcrunch (it can be a user acquisition strategy)
• Winning startup prizes
• Investor interest
• Tweets
• Market analysis made
• Segments defined
• Product plan defined
• Sold to a few customer (not necessarily, it’s about the business model)
• …
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How to define milestones?
Areas:
• Market (customer)
• Product
• Financial
• Team
To think about:
• B2C or B2B
• Segment
• Revenue model type
• Dependencies in the
business model
• Phase
• Tempo
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Examples
• Proof that you can work together as a team, usually historical evidence
• Proof that you can build something, i.e. working prototype
• Proof that it’s useful to someone – first users and clients
• Proof that you can talk to investors – every financing round, even small ones
• Proof that you can talk to audiences – 100k users or 1M users or 10M users…
• Proof that the initial team is able to attract talent
• Proof that ecosystem agrees with your ideas – bringing respected industryadvisors or partnerships on board
• Proof that there is market – $1M annually
• Proof that you can manage your finances – cash-flow positive operation
• Proof that you can scale – $10M annually
• Proof that the market is big! – $25M annually and beyond
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Workshop
• Define your key proofs needed (you think) that when fulfilled CLEARLY have reducedthe market and product risk at this stage
– Is it 10 interested customers, a MVP thatcan…
– Is it 1000 sign-ups and…
– Is it 2 paying customers and an indication thatthere are 10000 ”look a likes”?
• 20 mins
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Part 2 - The Deck
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The deck/the pitch
• A deck is for investors and show off’s
• A structured way to iterate and get feedback (not a static ”pitch”)
• Connect with the audience
• Be factual
• The primary purpose is to gain interest
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The deck - 10 slides
• Oneliner/hook
• Problem
• Solution
• Market (size)/traction
• Business model
• Unfair advantage/tech
• Competition
• Go to market/market
plan
• Team
• Roadmap (and
money)
• Use common tools
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Demoday
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Oneliner/hook
• A simple way to set your company into
context
• Gain interest
• ”Tinder is how people meet. It's like real
life, but better. ”
• ”Mint is the free, easy way to manage your
money online”
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1. Set the problem
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2. A crisp, unique solution
Get love (sex) Get rich Get power
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3. Demo/show off
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4. Market
YOUR market, not ALL market
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5. Revenue model
List 1-3 models
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6. Unfair advantage
Technology, team, competence, partnership….
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7. Competition
Why are you better? (Or different)
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8. How do you reach your
customers?
How will you reach your first 100(0) customers?
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9. Team
Avoid degrees, what’s important to the startup?
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10. Roadmap & financials
• Where have you been
– Progress & proof points (beta sign-ups, LoI,
revenue)
• Where are you going
– Major milestones (First revenue, 100k users,
break-even, next funding round)
• Do it visually clear and simple
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Traction beats everything
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Perception is everything!
(traction beats everything)
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The Demoday
• It’s a show!
• The right answer vs hypothesis
• 5 minutes…. Practice, practice
• The product MUST be shown in some way
• Youtube, slideshare etc
• http://bestpitchdecks.com/ pitchenvy.com
• Google 500startups, Techstars, Y Combinator pitches
• 2-3 st practice opportunities (video recording)
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