5000 business plans 50 deals 25 writeoffs
Post on 21-Oct-2014
192 views
DESCRIPTION
This presentation describes 5 key lessons I have learned in 25 years as a VC.TRANSCRIPT
![Page 1: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/1.jpg)
© Christopher Golis 2010 1
5000 business plans, 50 deals,
25 write-offsLessons learnt from 25 years in VC
Chris Golis MA MBA FAICD FAIM
![Page 2: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/2.jpg)
Christopher Golis 2010 2
Agenda
• Who am I?• 5 key lessons• Q&A
![Page 3: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/3.jpg)
Christopher Golis 2010 3
Who am I?
• Graduate of Cambridge, LBS, SIA• Started working in 1967• IT (general manager) Financial Services (VC)• Director of some 30 companies• Neverfail, Scitec/VeCommerce • Nanyang Founder in 1994, raised $140m• Fellow of AICD and FAIM• Author of 3 books
![Page 4: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/4.jpg)
4Christopher Golis 2010
1992
2007
1989
![Page 5: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/5.jpg)
Christopher Golis 2010 5
Who am I?
• Australia’s expert practical EQ• Emotions drive people; people drive
performance. • Workshop attendees:– Recognise the hidden 7 core emotions– Skills self- and social mastery
• www.emotionalintelligencecourse.com
![Page 6: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/6.jpg)
Christopher Golis 2010 6
Lesson #1: Do you have a Sustainable Competitive Advantage (SCA)
• Finished Cambridge 1967• Joined IBM North London working in Welwyn Garden
City• 2 years later joined start-up based in Oxford Circus• Went from this to this•
![Page 7: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/7.jpg)
Christopher Golis 2010 7
Computer Time International Limited
• Sold the night shift on other people’s computers
• 4 major customers• Decided to rent own computer (largest in the
UK)• Employed as systems programmer• Only 2 customers came across• In the tank after 9 months: Undercapitalised?
![Page 8: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/8.jpg)
Christopher Golis 2010 8
Why CTIL was always going to fail
![Page 9: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/9.jpg)
Christopher Golis 2010 9
Successful SCAs
• Cochlear• Resmed• Neverfail SpringWater• CBD printer
“If you don’t have a competitive advantage don’t compete.”
Jack Welch, former CEO General Electric
![Page 10: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/10.jpg)
Christopher Golis 2010 10
Lesson #2 Lease the Pencils
• Dialog International - 1969• Computer timeshare on IBM
computer $8 million capital 50/50
• $2m to set up Dialog UK• 100 terminals• 98 in-house application
programmers• 2 customers• Separate H/0 5 miles away
![Page 11: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/11.jpg)
Christopher Golis 2010 11
Lesson #3 Know the Game 1986
• Founders put in $50K - $50K• Govt. grant of $200K - $250K• Angels put in $500K - $1.5M• 1st VC round $1M - $4M• 2nd VC round $2M - $10M• List raising $10M - $50M
![Page 12: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/12.jpg)
Christopher Golis 2010 12
Visit to 5 of top 10 VCs in USA
• What is VC heaven?• ‘I have 3% of Tandem’
![Page 13: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/13.jpg)
Christopher Golis 2010 13
Funds are raised in stages
-3 -2 -1 IPO 102468
$M
-3 -2 -1 IPO 1
![Page 14: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/14.jpg)
Christopher Golis 2010 14
Founder’s ownership decreases
-3 -2 -1 IPO 10%
20%
40%
60%
80%
-3 -2 -1 IPO 1
![Page 15: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/15.jpg)
Christopher Golis 2010 15
Value of equity increases
-3 -2 -1 IPO 105
10
152025
$M
-3 -2 -1 IPO 1
![Page 16: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/16.jpg)
Christopher Golis 2010 16
www.yahoo.com
• 1994 David Filo & Jerry Yang start web-index• Late 1994 Sequoia Capital $1m for 25% $4m • Early 1995 5 VCs $9m for 20% $45m• Late 1995 Softbank $100m for 30%
$330m• Listed early 1996: $300m for 25% $1.2b• At valuation $100 b what are they worth?• 75% x 80% x 70% x 75% = 30%
![Page 17: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/17.jpg)
Christopher Golis 2010 17
Peg Technologies
Date Who Amount Val. $m
• 1990 Founder $100k $0.1m
• 2/99 SGDCL $0.75m $2.25m
• 12/99 Gowings $3m $18m
& SGDCL
• 6/00 IPO $12m $60m
What is founder now worth?
2/3 x 5/6 x 4/5 = 40/90 = 44% of $60m = $26.7m
![Page 18: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/18.jpg)
Christopher Golis 2010 18http://www.youtube.com/watch?v=WX2METdzjxU
![Page 19: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/19.jpg)
Christopher Golis 2010 19
Entrepreneur’s objective
Shareholdings
Founder49%
Inv 151%
Not this!
![Page 20: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/20.jpg)
Christopher Golis 2010 20
But this!!
Shareholdings
Founder40%Inv1
12%
Inv212%
Inv312%
Inv412%
Inv512%
![Page 21: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/21.jpg)
Christopher Golis 2010 21
Lesson #4 Steve Gilbert’s 3 stages of Entrepreneurship 2002
• Stage 1 – come up with idea & start the business
• Stage 2 – rapidly grow the business• Stage 3 – manage the far flung empire
![Page 22: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/22.jpg)
Christopher Golis 2010 22
Andrew Demetriou
• Best Sports CEO in Australia• Great Stage III manager High IQ High EQ• Had to be replaced as Stage I CEO
![Page 23: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/23.jpg)
Christopher Golis 2010 23
Lesson #5 Grab the gold ring
• 1975 Chris Golis & Lonely Planet• 1980 Gordon Bell & DEC• 1994 Sheridan Forbes & Yahoo
![Page 24: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/24.jpg)
Christopher Golis 2010 24
Australia’s big problems
• Too risky to send the elevator back down• 6σ • Only 2 or 3 markets – need an export strategy
![Page 25: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/25.jpg)
Christopher Golis 2010 25
No Elevators
“If you have done well in your chosen career, it’s your obligation to send the elevator back down. Inspire and give opportunities to others on the way up.” Jack Lemmon as quoted by Kevin Spacey AFR 23 October 2010
• 700 state & federal laws about directors’ liability
• Why I am not a director
![Page 26: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/26.jpg)
Christopher Golis 2010 26
6σ
6σ = 3 in a million
![Page 27: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/27.jpg)
Christopher Golis 2010 27
Population Centres New York-Northern New Jersey-Long Island 19.1 Los Angeles-Long Beach-Santa Ana 12.9 Chicago-Joliet-Naperville 9.6 Dallas-Fort Worth-Arlington 6.4Philelphia-Camden-Wilmington 6.0 Houston-Sugar Land-Baytown, 5.9Miami-Fort Lauderdale-Pompano Beach 5.5Washington-Arlington-Alexandria, 5.5Atlanta-Sandy Springs-Marietta 5.5Boston-Cambridge-Quincy 4.6
Sydney Newcastle Wollongong 5.5 Melbourne -Geelong 4.3
![Page 28: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/28.jpg)
Christopher Golis 2010 28
Q & A
• Why did you choose this seminar before all the others you could have attended this month?
• What was the #1 thing that impressed you in my profile?
• How did you find out about today’s event?
![Page 29: 5000 Business Plans 50 Deals 25 Writeoffs](https://reader035.vdocument.in/reader035/viewer/2022070301/5445c586afaf9fe32a8b4654/html5/thumbnails/29.jpg)
Christopher Golis 2010 29
Call to Action
• Readers are leaders: Buy E&VC• Contact Chris Golis [email protected]• www.emotionalintelligencecourse.com• 1 day workshops:– EQ in Selling: The Most Useful Sales Technique I
have ever used– EQ in Management: Lifting Your Level of Emotional
Intelligence