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1. Fundraising Strategy TemplateThis spreadsheet is a tool that will assist you in formulating a fundraising strategy for your Company.

1 The light yellow colored areas are for the user to input information into the spreadsheet.

2 If a detailed explanation of a term exits the term is marked with two asterisks (**) and when clicked will l ink to the explanation

3Where necessary, comments are provided to assist in the completion of cells where the requested information is not straightforward. Lookout for the small red tabs in the top right portion of a cell. In addition the cells with comments are highlighted in GREEN for quick referenceand easy access.

4To v ew comments, Mouse over ce s w t re tr ang es n t e upper r g t an corner or se ect t e comments comman un er t e v ewmenu.

5 If you have any difficulty in completing the template, please contact your Venture Catalyst.

Instructions

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Company nameValue proposition **

Product/service status (prototype/alpha/beta/commercial) **Months to first revenues

2008 2009 2010

PersonalFriends &

FamilyAngel Grants

Targete source o cap ta K

Startup Operating Industry

CEOCTOCOOCFOVP Sales

VP MarketingVP Engineering

Available exit options (Sale, IPO, Redemption) **

Follow on capital required to reach exit ($K)Round after current financing 1 2 3 4 5Months after closing (current financing)Funding amount

Key milestone to be achievedExpected investor returns

Start of fundraisingExpected closeCash in bankMonthly cash burn

Plan B?Triggers for Plan B

subject their existing equi ty ownership to repurchase and vesting?provide liquidity opportunities for investors?negotiate with investors to value the company?

No way

Timing/Plan B

2. Fundrais

Team

General Information

Size

Projections

Source

collaborate with investors in determining the strategic direction of the company?consult with investors to augment/change senior management, to include the CEO?

Revenue ($K)Operating cash flow ($K) **

Exit opportunity

Expected invest

Are senior managers and founders willing toAttitudes and expectations

Potential acquirersYears to exitExit enterprise v

consult with investors to raise additional capital?

In placeExperience

ultimately cede control of the business to investors?

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Targeted funding round ($K)

Months of operations funded

Firm/Group Prosp. c ampion Source of referral

Company Date Valuation Comments[1][2][3][4][5]

Amount

mpleted

Access

Targeted investors

Rationale

Last Post-money valuationExpected "step-up" for next fundraising

Mitigating actions

Cost

Top five objections to invest

Comparable transactions

Milestones to achieve

Desired Pre-money valuation

Risk management

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Term Details

Value Proposition 1This is the total of all benefits which a vendor promises to a customer in return for an associated payment (or other Essentially this can be stated as what the customer gets for what the customer pays.

Prototype Product2

In software development , a prototype is a simple working model of a product or information system. It ias part of the development process. a prototype is a "hand-built" model that represents a manufactured, yet easily replicable, product in sufficient detailthe design.

Alpha Product 3

Beta Product 3

Commercial Product A product that is ready to be sold to the customer.

Operating Cash Flow 4Operating cash flow is the cash that a company generates through the running its business. It is a measure of a busiindicator than earnings because a company can show positive net earnings (on the income statement) and still not bflow that pays the bills! One method for calculating operating cash flow is OCF = EBIT + Dep

Market Definitions 5

Potential market - those in the total population who have interest in acquiring the product. Available market - those in the potential market who have enough money to buy the product.Qualified available market - those in the available market who legally are permitted to buy the product.

Target market - the segment of the qualified available market that the firm has decided to serve (the served mPenetrated market - those in the target market who have purchased the product.

Sale 6Sell your company to another company or personal buyer. Usually involves both a transfer of ownership and a transcompany is sold, the role of the previous owners is usually negotiated along with the terms of the sale.

IPO 6I nitial P ubilc O ffering - this is the first sale of stock by a private company to the public. While the IPO transfersmanagement team in place before the IPO will typically still be in charge of the company post-IPO.

Redemption 7If you've raised $ from institutional investors lately, chances are good that you did so by issuing "Redeemable Prefeelement means that your investors can redeem their shares for cash down the road. Redemption rights are very rarelsuch a harsh effect on your balance sheet.

These are both early versions of a software product that may not contain all of the features that are planned for the fgoes through two stages of testing before it is considered finished. The first stage, calledorganization developing the software. The second stage, called beta testing , generally involve

3. Detailed Explanations

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3. Detailed Explanations

Pre-money valuation 8,9

A pre-money valuation is a term used in private equity or venture capital that refers to the valuation of a cfinancing.External investors, such as venture capitalists and angel investors will use a pre-money valuation to determine how their cash injection to an entrepreneur and his or her startup company. For example, if an investor makes a $10 millreturn for 20% of the company's equity, the implied post-money valuation is $50 million. To calculate the pre-moneinvestment is subtracted from the post-money valuation. In this case, the implied pre-money valuation is $40 millioThere are several ways to determine valuation for your startup. Know that with most of these methods may be diffiend of the day you may need to rely on the fairness of your investor to propose a valuation that is consistent with otconsistent with other relative valuations in his/her existing portfolio.

Post-money valuation 10A post-money valuation is a term used in private equity or venture capital which refers to the valuation of a companinvestment or financing. If an investor makes a $100 million investment in a company in return for 20% of the commoney valuation is $500 million.

Expected "step-up" for nextfundraising 11

The time to think about your next round is right after you close financing. From the moment you start burning yourround. your next round?

1. Determine your runway: How many months of cash do you have? Based on this plusneed to start pitching to potential investors? This will give you a time horizon for your visualization. If you need to b

now, this will be the planning horizon for the milestones you need to achieve to be investor-ready.

2. Prepare the pitch: Actually complete your investor deck as if you were raising that round today. Describ

3. Go back in time: The last step is to work back from that future visualization and figure out the strategies make that picture of tomorrow a reality.

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1 http://en.wikipedia.org/wiki/Value_proposition2 http://searchcio-midmarket.techtarget.com/sDefinition/0,,sid183_gci1000947,00.html3 http://www.webopedia.com/TERM/a/alpha_version.htm4 http://www.investopedia.com/terms/o/operatingcashflow.asp5 http://www.netmba.com/marketing/market/definition/6 http://www.inc.com/resources/startup/articles/20060301/tfaley.html7 http://startupcfo.ca/8 http://en.wikipedia.org/wiki/Pre-money_valuation9 http://www.startupventuretoolbox.com/Valuation%20Advisor.htm

10 http://en.wikipedia.org/wiki/Post-money_valuation11 http://startupcfo.ca/2008/04/visualize-your-next-financing-round.html

References

http://en.wikipedia.org/wiki/Value_propositionhttp://searchcio-midmarket.techtarget.com/sDefinition/0,,sid183_gci1000947,00.htmlhttp://www.webopedia.com/TERM/a/alpha_version.htmhttp://www.investopedia.com/terms/o/operatingcashflow.asphttp://www.netmba.com/marketing/market/definition/http://www.inc.com/resources/startup/articles/20060301/tfaley.htmlhttp://startupcfo.ca/http://en.wikipedia.org/wiki/Pre-money_valuationhttp://www.startupventuretoolbox.com/Valuation%20Advisor.htmhttp://en.wikipedia.org/wiki/Post-money_valuationhttp://startupcfo.ca/2008/04/visualize-your-next-financing-round.htmlhttp://startupcfo.ca/2008/04/visualize-your-next-financing-round.htmlhttp://en.wikipedia.org/wiki/Post-money_valuationhttp://www.startupventuretoolbox.com/Valuation%20Advisor.htmhttp://en.wikipedia.org/wiki/Pre-money_valuationhttp://startupcfo.ca/http://www.inc.com/resources/startup/articles/20060301/tfaley.htmlhttp://www.netmba.com/marketing/market/definition/http://www.investopedia.com/terms/o/operatingcashflow.asphttp://www.webopedia.com/TERM/a/alpha_version.htmhttp://searchcio-midmarket.techtarget.com/sDefinition/0,,sid183_gci1000947,00.htmlhttp://en.wikipedia.org/wiki/Value_proposition