Pitchbook kyodo

KYODO Consulting Group

The Investor Pitch

Presented by: Young Kwon

Date: 4/30/2014

2

Investment Paradox

Entrepreneurs

Getting to

Yes

Investor

Getting to

NO

3

Want different

Capacity Has funds

to invest

Successful Track record

Compatible Match of size/stage Geography

Friendly No directly competitive investment

Strategic Relevant

portfolio

The Right

Investor

Team Skills &

Track record

Platform Significant

Technological advantage

Market Sizable and

Addressable

Traction Early

customer

IP& Biz Model

Entry Barriers

The Right

Investment

Entrepreneurs want…. Investors want….

3 Levels of Engagement

Emotional Rational Financial

7 Signs the investor

Signs

the investor

is just not

that into you :-(


1 “I still don’t know

what you do”


2 “Isn’t your product a

nice to have vs.

A real market need?”


3 “Is your market really

big enough?”


4 “I still don’t understand

how you make money”


5 “Are you underestimating

your go-to-market costs?”


6 “Couldn’t your

competitors copy you?”


7 “Do you have the right

players on your team?”

Pitch principles

Connecting on an emotional, rational financial level

Storify

Create a well paced, logical narrative.. think storyboard

Disnify

Use visuals – frameworks, graphics and image.. But only

where they make sense… you are not keynoting a TED talk

Personify

Relate to the team’s personal experiences… investors are

in the people business

Simplify

Avoid too much detail, overused buzzwords and jargon

getting a term sheet after first meeting is not the goal

Quantify

Show how you make money for the investor. Show key metrics

Verify

Can you finish this sentence? As evidenced by … Back up

your claims wherever you can with visible proof

Components of the Investor Pitch

#1 Real

Problem

#3 Attractive

Market

#2 Unique

Advantage

#4 Compelling

Investment

Pacing your investor pitch

#1 #2 #3 #4

Start End

Real

Problem

Attractive

Market

Unique

Advantage

Compelling

Investment

3 min 4-5 min 4-5 min 3 min

*Note : Elapsed times are guidelines only

Answering the “So what?”

Focusing a Problem that Matters

No. 1

Real

Problem

Creating Impact

The Company & It’s Solution - Elevator Style

Core Value Proposition : Use a single sentence

Unique Benefit : Focus on one single aspect of

what you do(aka…. “The Big Idea”)

Metaphors : Try to create a cognitive connecting to

something people understand i.e. metaphor

“Cover = Uber for restaurants or Rent Frock

Repeat = Zipcar for Designer Fashion”

Emotion: Create a visceral response

(why are things still done this way?) Be provocative…

Nice to have’s aren’t investable

Start Min 3

Introduction

Key Message : We’re fixing the insanity of the status quo

Defining the Problem

Paint a picture of who has this pain

Current State : Show the insanity of how customers

address the issue today

Historical Evolution : What’s changed in the

customer’s mindset

Personas : Describe the main players in your

markets you address

Pictures : Every pictures tells a story

Start Min 3

Introduction

Key Message : We’re solving real pain… not “nice to haves”

Problem

Your solution to the Rescue

Describe WHAT you do and HOW you do it

Product : What is it

(screen shots, product photos)

Functionality : The Who + Do

Benefit : High level value

Category : Where do you paly? Start Min 3

Introduction

Key Message : Our solution is novel and easy to understand

Traction

Solution

Problem

Stage : What is the readiness of the solution?

What’s been Achieved to Data?

Show your ability to succeed : On lots of sweat… little $

Founded (year)

Employees offices

Advisors

Product Release(s)

Beta Users/Unique views/Registrations

Paying Customers

Partners (Technology/Channel)

Certification/Industry awards

Media Coverage

Patents

Start Min 3

Introduction

Key Message : Our team is committed and can execute

Traction

Solution

Problem

Creating Impact

The Company & It’s Solution - Elevator Style

Core Value Proposition : Use a single sentence

Unique Benefit : Focus on one single aspect of

what you do(aka…. “The Big Idea”)

Metaphors : Try to create a cognitive connecting to

something people understand i.e. metaphor

“Cover = Uber for restaurants or Rent Frock

Repeat = Zipcar for Designer Fashion”

Emotion: Create a visceral response

(why are things still done this way?) Be provocative…

Nice to have’s aren’t investable

Start Min 3

Introduction

Key Message : We’re fixing the insanity of the status quo


#1 #2 #3 #4

Start End

Real

Problem

Attractive

Market

Unique

Advantage

Compelling

Investment



Opportunity Awaits

Lots of Room in the markets to scale a Business

No. 2

Attractive

Market

Sizeable Market Opportunity

It’s very Big…. And you can get To IT

Size : What’s being spent today on problem? Build

from ground up. Can the market support multiple players?

Addressability: What’s the reasonable market you

can serve?

Segments : Going Niche or broad? Global : identify other markets Proof : Use 3rd party analyst reports

Thought Leadership : Are you using primary research to gain insight? Charts : Keep it visual and engaging

Min 3 Min 10

Market Size

Key Message : We have unique insight into the market

Early Customers/Prospects

Nothing really matters till somebody buys something

Status : Closed vs. Prospects and paid vs. Free Trail

Categorize : Key segments etc

Contextualize : Why they bought

Evangelists : Customers quotes to validate market

pain and size

Min 3 Min 10

Market Size

Key Message : We have buyers who must have our solution

Customers

Personas : Describe customers characteristics

Logos : Categorize… Avoid “logo soup”

Making Money

Where does the growth and profit come from?

Key Metrics: Pricing, Avg. Deal Size

Registrations/Subs., Churn

Note : Costs to Acquire is perhaps the most

overlooked and important metric

Competitive Scenarios: Is your model sustainable

if competitors start stealing share?

Have you factored in potential of downward price

pressure over time?

Min 3 Min 10

Market Size

Key Message : We have validated our revenue model and can

demonstrate how it will allow us to scale the business

Customers

Revenue

model

Channels : What are the downstream costs to sell

and service the customers(is this built in?)

Registrations/Subs., Churn

Acquiring Customers

What’s your go-to-market strategy?

Visibility : Critical to success.. What’s your story?

Lead Generation Programs : What marketing

approaches will you use(stay high level – categorize)

Min 3 Min 10

Market Size



Customers

Revenue

model Sales Model : Direct vs. Channel (Do you have

partners? Have you built a wave for channels to ride?)

Marketing

& Sales

Systems : Do you have an infrastructure to scale

(CRM/Inbound Mktg. Platforms etc.)

Testing : Do you have cap

ability to test value prop./offers?

Stages : Do you have the ability to pivot from launch

to growth to maturity


#1 #2 #3 #4

Start End

Real

Problem

Attractive

Market

Unique

Advantage

Compelling

Investment



Opportunity Awaits

Many of the essential pieces are in place

No. 3

Unique

Advantage

Partners

Show how you can punch above your weight

Role : What value with they add to your solution

Research/Development/Sales/Support etc.

Reputation: Do you have the right players

in the market you are serving?

Category Fit : Do they have sufficient market power? Executive Sponsorship : Do you have buy in from Key people inside the channel? Incentives : Is the partner aligned financially to support you?

Longer Term : Is there competitive threat or potential M&A?

Min 6 Min 10

Partners

Key Message : Important market players buy into our vision and

want to work with us

Competition: Technolgy/Leadership

Creating barriers to entry

Technology : Validate how you are different?

How much market lead do you have? What degree

of leverage and scale do they create?

Process : Are there unique process elements of

how your technology works?

Patents : What is the focus of the patent and what

stage are you at? (provisional filling, patent granted)

Not a bad idea to mention any name brand attorneys

you work with)

Min 6 Min 10

Partners

Key Message : We’ve nailed a problem that is hard to solve.

It will be hard for competitors to catch up

Competition

Technology/Leadership

Licenses : Are there 3rd party components of your

Solution that are licensed? Do you have an exclusive

right to the technology?

Team & Advisory

The capabilities to execute on the plan?

Company Background: List experience in terms of

key companies each team member worked for

list “pedigrees” (notable exits)

Achievement : Focus on a key aspect of their

experience that uniquely qualifies them for the venture Min 6 Min 10

Partners

Key Message : We have assembled the right mix of people who

understand our target customers and the dynamics of the

marketplace. We have “know how” and “know who”

Technology

/Leadership

Team &

Advisors Planned Hires : Speak briefly to what primary role they

will play in the venture

New Hires : Where applicable, speak to any key people

you may be hiring to build out the team

Acquiring Customers

What’s your go-to-market strategy?

Visibility : Critical to success.. What’s your story?

Lead Generation Programs : What marketing

approaches will you use(stay high level – categorize)

Min 3 Min 10

Market Size



Customers

Revenue

model Sales Model : Direct vs. Channel (Do you have

partners? Have you built a wave for channels to ride?)

Marketing

& Sales

Systems : Do you have an infrastructure to scale

(CRM/Inbound Mktg. Platforms etc.)

Testing : Do you have cap

ability to test value prop./offers?

Stages : Do you have the ability to pivot from launch

to growth to maturity

Competition Example

We have everything that the market leaders are not:

Simple, Fast, Easy, Secure, Addictive, FREE.

Personal and Biz

Drag and Drop

Bank Feeds

Easy Set-up

Free

Multiple Business

Invoicing

Cloud Based

Collaborative

Intuitive interface

YOU Comp 1 Comp 2 Comp 3 Comp 4

Team Example

A Team of experts

Chris Bryson, CEO

Aeroplan, Warrillow &Co.

Marc Faucher, COO

Blackberry partners fund

Amr Hiram, VP IT

SAP, Red Iron

Diego Maniloff, Lead Data

Scientist MIT


#1 #2 #3 #4

Start End

Real

Problem

Attractive

Market

Unique

Advantage

Compelling

Investment



Opportunity Awaits

Many of the essential pieces are in place

No. 4

Compelling

Investment

How you will Make Money

Key Metrics that Explain the Bottom Line for Investors

Key Numbers : Revenues, Expense, EBITA

Customers, Headcount

Burn Rate: What is the net cash out month

Assumptions : Be prepared to defend them Scenarios : Be able to speak to impact of various scenarios (i.e Cost of acquisition is x % higher than forecast or lack of conversion from free to premium)

Min 10 End

Financials

Key Message : Our venture clearly offers a superior return for

our investors.

The Ask

Value & Deal Structure/Term & Use of Funds

Investment Structure/Terms: Type of instrument

(Convertible Debt, Equity) and what are the terms

of the deal

Amount : What’s been raised and what is left in the

round? Use of Proceeds : What milestones will you

achieves(with the investors money)

Min 10 End

Financials

Key Message : Our structure and terms should meet you

investment criteria

Offer Details

Runway : What amount of time does the current

money buy (can you hit breakeven or is new round

required?)

Pipeline : Be prepared to speak to who is committed

so far and who are you approaching.

You must show momentum – ‘herd dynamics.”

Valuation : Be careful about “premature” discussions

discussions regarding pre-money value-don’t price

from the podium!

A Recap : The 4 Components of the Pitch

#1 Real

Problem

#3 Attractive

Market

#2 Unique

Advantage

#4 Compelling

Investment

In the End…. The Investment is in You

A dozen attributes smart investors' look for in startup teams

1. Honesty

2. Vision

3. Resourcefulness

4. Logic

5. Drive

6. Humility

7. Leadership

8. Critical Thinking

9. Commitment

10. Patience

11. Credibility

12. Agility

Gives straight answers to investor questions

Demonstrates customers insight/though leadership

Can make an investor’s dollar go far

Makes wise, pragmatic decisions quickly

Genuine passion for early stage & ability to excite

Coachable an seeks help to address weak spots

Has the ability to attract and lead a winning team

Challenges assumptions and spots the false ‘+s

Not just involved – sweat & or capital invested

Tolerance to the ambiguity of innovation

Well research. Uses data to back assumptions

Decisive. Cuts losses & pivots at the right time


1. 쉽고 명확한 설명 최대한 간결, 명확하게

2. 구성원의 역량을 어필 조직, 구성원의 경험, 활동들

3. 회사의 비전

단계별 운영방안

4. 경쟁사와의 차이점 부각

차이점, 당사의 비즈니스가 특별한 점

5. 하나의 틈새 시장 공략

모든 분야가 아닌 틈새 시장 집중 초기 포지셔닝

6. 재무제표에 대한 이해

돈, 시간, 조직운영에 대한 방향

7. 명확한 이점 and 한계점 여러분의 비즈니스가 왜 중요하기 그것이 시장에 어떤 이점을 주는지 현재 부족한 점 향후 어떻게 극복해 나갈 것인지 설명

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