the rise of the angels (and the entrepreneurs) - bangalore - dec 2012
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@paulsingh #unpluggd
PAUL SINGH
@paulsingh・paul@500startups.com・resultsjunkies.com
THE RISE OF THE ANGELS (AND THE ENTREPRENEURS)
@paulsingh #unpluggd
500 STARTUPSGETTING TO KNOW
BECAUSE WE’RE KIND OF A BIG DEAL
PAUL SINGH
@paulsingh・paul@500startups.com・resultsjunkies.com
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EARLY STAGE STARTUPS
HAVE CHANGED
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STARTUP COSTS LOWER THAN EVER
BUT SCALING STILL COSTS MONEY
CLOUD, OPEN SOURCE AND ONLINE DISTRIBUTION DRIVING
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WEB GETS BIGGER.WORLD GETS SMALLER.
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TRACTION IS THE NEW INTELLECTUAL PROPERTYPLATFORMS (SEARCH, SOCIAL & MOBILE) PRIMARILY DRIVING THE CHANGE.
NO LONGER “GOOD ENOUGH” TO DEPEND ON TECH DIFFERENTIATION.
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CAPITAL INCREASINGLY COMMODITIZED
RISE OF THE ANGELS, YO!
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NEW REALITY: MONEY FOLLOWS
FOUNDERSRISE OF THE ENTREPRENEURS, YO!
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SIGNALS ARE EVERYWHERE
BIG DATA + OPEN SOURCE ANALYTICS = NEW TECHNIQUES FOR VC
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SIGNALS ARE EVERYWHERE
BIG DATA + OPEN SOURCE ANALYTICS = NEW TECHNIQUES FOR VC
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TRANSPARENCY ISSIGNALS ARE EVERYWHERE
BIG DATA + OPEN SOURCE ANALYTICS = NEW TECHNIQUES FOR VC
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WALL STREET BEAT US TO IT
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UBS PROPRIETARY SATELLITE PARKING LOT FILL RATE ANALYSIS POINTS TO AN INTERESTING CADENCE INTRA-QUARTER AND POTENTIAL UPSIDE TO OUR VIEW.
“
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TWICE A WEEK A SMALL HELICOPTER CIRCLES OVER CUSHING’S TANK FARMS ON AN OIL INDUSTRY SPYING MISSION.
“
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WALL STREET ISN’T ALONE
THESE TECHNIQUES ALREADY USED TO UNDERWRITE IN-VITRO FERTILIZATION LENDING, PAYDAY LOANS, SUBPRIME AUTO LENDING, HOME/PERSONAL/AUTO INSURANCE AND MORE.
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WE CAN DO IT, TOOSURPRISE!
IT TURNS OUT,
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+ “GUT” + TRUSTED MENTORS + MUCH, MUCH MORE DATA.
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WE CAN DO IT, TOO.
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WE CAN DO IT, TOO.
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WE’RE DOING IT, TOO.
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VENTURE CAPITAL IS OPEN TO ATTACK BY DISRUPTIVE NEW BUSINESS MODELS AND TECHNOLOGY.
“
-- NAVAL RAVIKANT (@naval)
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EARLY STAGE VCIS CHANGINGHAS CHANGED
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STATE OF THE ART IN EARLY STAGE INVESTING IS NOT
VERY SOPHISTICATED
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UNBUNDLING OF ADVICE, CONTROL
AND MONEY
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USED TO BE ABOUT CAPITAL, JUDGEMENT
AND DEALFLOWTODAY, IT’S ABOUT ACCESS.
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(500) CHECKLISTProduct solves a problem for a specific target customer
Capital-efficient businesses - operational @ <$1M funding
Primarily internet-based distribution - search, social, mobile, local
Simple revenue models - transactions, subscriptions or affiliate
Functional prototype before investment (or previous success)
Small but measurable usage - some customers, early revenue
Small but cross-functional team - engineer, design/UX, marketing
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(NEW) FINANCINGS
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(NEW) FINANCINGS Standardized terms
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(NEW) FINANCINGS Standardized terms
No fixed amounts, no closings, no leads
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(NEW) FINANCINGS Standardized terms
No fixed amounts, no closings, no leads
Continuous, not discrete rounds
@paulsingh #unpluggd
(NEW) FINANCINGS Standardized terms
No fixed amounts, no closings, no leads
Continuous, not discrete rounds
Prices beginning to float
@paulsingh #unpluggd
(NEW) FINANCINGS Standardized terms
No fixed amounts, no closings, no leads
Continuous, not discrete rounds
Prices beginning to float
No Board seats at the earliest stage
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(NEW) FINANCINGS Standardized terms
No fixed amounts, no closings, no leads
Continuous, not discrete rounds
Prices beginning to float
No Board seats at the earliest stage
Herd mentality and oversubscriptions
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BY ITS NATURE, THE INTERNET UNDERMINES ANYONE WHOSE STATUS DEPENDS ON PRIVILEGED ACCESS TO INFORMATION.
“
-- MICHAEL LEWIS
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Demo Day Videos ⟹ livestream.com/500startups
Sample Pitch Decks ⟹ slideshare.net/500startups
Venture Capital 101 ⟹ venturehacks.com/archives
Investor Thoughts:
Brad Feld ⟹ feld.com
Fred Wilson ⟹ avc.com
Chris Dixon ⟹ cdixon.org
Mark Suster ⟹ bothsidesofthetable.com
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YOUR KEY TAKEAWAYS
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YOUR KEY TAKEAWAYS
Focus on Traction.
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YOUR KEY TAKEAWAYS
Focus on Traction.
Learn to Communicate and Inspire.
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THE RISE OF THE ANGELS (AND THE ENTREPRENEURS)
PAUL SINGH
@paulsingh・paul@500startups.com・resultsjunkies.com
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