daniel kivatinos

Free Lunch Friday Notes August 6th 2010

Aug
14

NYCSeed‘s managing director Owen Davis came by the Rose Tech Incubator this week to give a talk on what investors look for in startup’s. Some of the key points Owen mentioned that I took away from the talk are below. (NYCSeed only invests in the 5 NY borrows).

Owen Davis of NYCSeed at the Roes Tech Incubator

FUNDING CRITERIA

To anyone doing a startup, “Time matters”. Owen mentioned that committing large amounts of time to R and D is a bad mistake.
Timing has to be in your favor, things have to be aligned. Your technology and the timing is key. You can build something great but is there a demand for it?

Owen recommends 2 person teams, I hear this magic number a lot, google, yahoo, etc. Startups with 2 founders is the magic number. It shows a demonstrations team work, difference in dynamic. With a team of two you have a sounding board.

Another key thing is to have a prototype complete.

Showing you have tech leads on as founders is the DNA of the company it is important. Moment by moment technology changes.

Angels and VCs like to see a good sized market, show a clear path to revenue.

TYPE OF STARTUP COMPANIES

Network Effect
-Hard to invest in these
-Risk
–e.g.: Gaming companies
–e.g.: iPhone apps
–e.g.: YouTube lost 40 or 50 million a year
-not real innovation

Application Oriented
-look at market
-build an application
–e.g.: ticketfly.com
–e.g.:quickbooks

Innovation
e.g.: google’s rank algorithm
e.g.: Advertising space, customer segmentation of ads
Investors believe or don’t believe in the innovation you have.

Some companies have pricing power, if coke raised it’s prices they would be ok.
If a copper wire company raised it’s prices it would take a toll on them

Some examples of companies that have a little higher prices are:
zappos.com has customer loyalty.
Amazon charges more then others.
Wholefoods charges much more then others.

Team
Having a good team culture is important.
Be honest and be transparent that is what is important.

WHAT MAKES A COMPANY FUNDABLE
Big Market
Team

A “good business” is not necessarily fundable.
A lot of great biz that will be successful without funding.

GOOD TRENDS
-how do u derive meaning out of data
-New ways to data mine
-Project management tools
-Online learning
-Digital advertising
-Billboard industry
-Local search
-Building a better Craigslist
-Building better Email

Free Lunch Friday Notes July 23 2010

Jul
27

We were honored this week to have David Rose talking about the direction that companies are going.

I took a few notes on what he had mentioned.

First he mention some great outsourcing resources:

David also mentioned that we should take a look at the books Wikinomic sand Three Moves Ahead a book by Bob Rice.

David S. Rose on pitching to VCs

Apr
18

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BootUpNYC 2009

Oct
01
Michael and I went to BootUpNYC 2009, it was a great experience, we met a number of great
people doing startups and looking to do startups. There were investors, workspace providers and people providing advice. The BootUpNYC is a must for anyone starting and running a business.
Photos of the night:
bootupnyc_2009_collage
Michael and I at the BootUp, me on the left and Michael on the right:
Danie and Michael
David Rose, an investor whom we had the honor to chat with:
Tokumbo Shobowale, Chief Operating Officer of the New York City Economic Development Corporation:
Darren Herman, entrepreneur and digital media evangelist:
Sanford Dickert, a social-media consultant:
Bruce Niswander, an entrepreneur and consultant with over 20 years of experience:
Rachel Sterne, CEO of GroundReport.com:

Pitching to Angel Investors and Venture Capitalists

May
21

1)
Tell a Story
(e.g:iPad+doctors)
(You have 10 seconds to get their emotional attention)

2)
Talk about product.
(e.g.:iPad product)

3)
Talk about how we are going to generate revenue.

4)
Your needs
e.g.:
2-3 biz dev people
Higher a PR agency
Bring on developers

5)
Money and how much you are asking for and the time.

6)
Exits for investors and us.

Taken from David Rose:
VC Pitches is about investing in the PEOPLE!
Angel pitches are ~15 minutes or under
VC pitches are less then 30 minutes
-1) You must show integrity
-2) You must show passion

Just some side notes, never say the following words to investors, they invalidate previous things you mentioned!:

  • Honestly
  • Truthfully
  • To be Frank
  • Frankly
  • Not for nothing
  • Realistic
  • Kind of
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