SDSI SPRINGBOARD INVESTOR PRESENTATION

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SDSI SPRINGBOARD INVESTOR PRESENTATION
THERE ARE HELPFUL TIPS FOR MOST SLIDES - SEE
NOTES SECTION OR USE NOTES VIEW IN POWER POINT
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ROLE OF AN INVESTOR PITCH

• The objective of the investor presentation is to
  show that your venture is a great investment and
  that you and your team can and will make it
  happen.
• Every presentation is unique but each contains
  essential content in a logical progression that
  investors expect to see and hear.

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GETTING TO YES

• The hard reality is that real investors listen to
  /-1200 investor pitches a year and invest in
  fewer than 6 ventures. So most of the time they
  say no.
• Your objective is to keep them from finding a
  reason to say no.
• Saying or showing too much too early or the wrong
  things will result in a no.
• Focus your presentation at each stage, on the
  relevant content that will make an investor want
  to go to the next stage of the funding process.

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FUNDING ELEMENTS
hook that gets ask for Exec Summary

• 90 words or less
• from Ex Summary

Elevator Pitch
one page that gets ask for Invest Presentation
Executive Summary

• from Investor Pitch

• Oral Exec Summary
• for special events

Quick Pitch
Investor Presentation
15 minute ppt. that gets a Follow Up Meeting

• Plus /- 30 min QA
• Real presentations get
• hit with QA throughout

Much deeper QA that justifies DD
Follow-Up Meeting
Investor deep dives for issues

• Looking for reason to say NO

Due Diligence

• Serious negotiation
• , dilution, control,
• liquidation prefs

Term Sheet

• Must have professional
• representation

Funding

• Milestone driven

Controlled availability
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Tips to presenting

• 15 minutes is the target presentation time. Any
  more and investors will question your ability to
  get to the point in running the venture.
• You can have more than 15 slides, just dont
  spend much time speaking to many of them, they
  can come back later during QA.
• Do not read from your slides, maintain eye
  contact with audience.
• Remember YOU are the only one with the script, so
  if you forget something, or get it out of order,
  YOU ARE THE ONLY ONE WHO KNOWS UNLESS YOU REACT,
  JUST MOVE ON.
• Dont think out loud, frame your sentences before
  you speak.
• Uhm, is not a word we should use ever.
• Pauses between thoughts and sentences are NORMAL,
  and gives your audience the chance to digest and
  understand what you are saying.
• You need to breathe when you are speaking, so
  dont be afraid to end a sentence vs. using AND
  and keep talking trying to OVER EXPLAIN
  something.
• Monotone speaking is the best way to instill a
  lack of confidence in you and cause your audience
  to turn you off and start working on their mobile
  devices.
• Get to the point on every slide while presenting.
• Figure out what the most important thoughts or
  bullet points are, use voice inflections to
  emphasize key words or thoughts, make it natural
  to you or it does not work.

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Template Guidelines

• This template serves as an example modify as
  appropriate to make sure your companys story is
  represented effectively.
• The purpose and process of completing this
  template is to help you understand the nuances of
  your business that investors expect to see,
  however this template should not be translated
  directly into a visual presentation.
• There are explanatory notes for most slides
  please see notes section or use notes view in
  power point.
• Prepare back up (BU) slides for use during the
  QA. This tells investors that you are
  resourceful enough to anticipate their questions
  and have answers.
• Using your BU slides effectively is a practiced
  art.
• Pictures and graphics are often more effective
  than words
• Animation seldom works, sometimes videos work
• Avoid narrative on the slides when possible, use
  bullet points
• This template includes the SDSI branding - use
  Slide Master to create your own branding

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THE INVESTOR PRESENTATION TEMPLATE Slide Content
and Order Guidelines
THERE ARE HELPFUL TIPS FOR MOST SLIDES - SEE
NOTES SECTION OR USE NOTES VIEW IN POWER POINT
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COVER SLIDE

• Logo or product picture
• Tagline/value proposition
• Presenters name

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BUSINESS DESCRIPTION

• FOR sports and active lifestyle (SAL) industry
  stakeholders WHO are committed to the development
  of SAL business and the expansion of the SAL
  industry, SDSI IS the only nonprofit organization
  THAT provides mentoring, access to capital, elite
  level networking, collaboration, industry
  research and talent pipeline for the SAL
  industry. UNLIKE other membership based
  nonprofits, OUR organization is dedicated solely
  to driving the SAL industry and economy.

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BUSINESS MODEL

• YOUR COMPANY
• Design
• Manufacture
• Assemble
• Stock

Users
P
P
Supplier(s)
Distribution
P
P
Users

Users

P

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OFFERING

• Seeking 700,000 in Convertible Notes at 4
  interest
• Convertible into Company equity at a 25 discount
  to value established by qualified financing
• No further financing is anticipated
• Anticipated investor exit within 5 years which
  will achieve a 9 X return

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THE STORY

• 60-90 SECONDS OF YOU
• Narrate your personal story about what caused you
  to want to
• start this venture
• Appropriate photo or video in the background

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PRODUCT PAIN SOLUTION

• Explain why people will see compelling value in
  your offering
• Describe very specific target customer
  suffering today and how intense a motivation it
  is for them to seek a solution
• OR describe the desire you will create and how
  strong
• it will be, ex., people did not know they
  desired iPods and iTunes
• Now describe the solution(s) your offering
  provides in direct relation to the pain(s)
• Describe what will compel people to buy
  considering their alternatives
• NOTE doing nothing is an alternative

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MARKET OPPORTUNITY

• Target Customer
• Demographics
• Personas (2-3)
• General Traits

TAM XYZ Million Athletes Growth Rate xyz

• Target Market
• Stage I Southern California
• Stage II United States
• Stage III International

SAM XYZ Million Youth Athletes

• Goal Objectives
• Capture .01 of SAM to achieve goals.
• 5 YR target goal of business Model

XYZ Target Demographic 10-16yrs

• Assumptions (examples)
• Each customer will have an average spend of XYZ
• Each customer will reach 5 other users

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GO TO MARKET
Give your marketing campaign a name. Bring it to
life! Goal Identify your 5 year revenue goal

• Goals Objectives
• State goals and objectives and make them
  measureable. For example
• Build Awareness Education
• Drive Acquisition
• Develop Loyalty Repeat Business

• Customer Acquisition
• Identify how you will acquire your customers
  (i.e., Web, Retail)
• Give example of general path to conversion (i.e.,
  mktg campaign, drives people to web, web drives
  ecommerce)
• Average cost of acquisition
• Lifetime customer value

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GO TO MARKET CONTINUED

• Strategies Tactics
• Describe strategies tactics to reaching goals
  and objectives (these build awareness and drive
  acquisition). For example
• Stage I Regional
• Mobile
• Social Media
• Print Digital Media
• Strategic Partners
• Sponsorships / Partnerships
• Blast Team Influencers
• Traveling Road Show
• Stage II National
• Measure, Adjust, Re-Deploy

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COMPETITOR OVERVIEW
Value Components Your Company Competitor 1 Competitor 2 Competitor 3
One X X O X
Two X O X X
Three X O X O
Four X X O X
Five X X O X
Six X O X O

• Commentary (Use this space to highlight key
  strengths weaknesses)
• Point 1
• Point 2
• Etc.

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SUSTAINED COMPETITIVE ADVANTAGES BARRIERS TO
ENTRY

• Describe the key differentiators that will
  protect the enterprise for
• the next 12-18 months or longer
• Patents, describe status and key IP
• Trademarks, Trade Secrets
• Strategic Alliances
• First Mover advantageland grab
• Entrenchment
• Stickiness

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PRODUCT VALIDATION

• Show that your offering actually works and has
  appeal
• Actual sales, customers (quantify)
• Results of market test, customer experience,
  clinical trials
• Letters of Intent (to purchase, distribute, etc.)
• Memorandums of Understanding (to join forces,
  etc.)
• Significant testimonials
• Other validations

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STRATEGIC RELATIONSHIPS

• Describe strategic relationships you have or will
  form to
• Provide needed resources and markets
• Give credibility and comfort for you customers
• Overcome regulatory barriers
• Manage IP issues
• Provide a ready exit

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DISTRIBUTION PLAN / Margin Analysis
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FINANCIAL OVERVIEW (proforma highlights)
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DEVELOPMENT TIMELINE
(What does the investor money buy when?)
Mass Production
Market Development II
Pilot Test
Operating Milestones
Ramp Up Production
Market Development I
Strategic Planning
EXIT
BREAKEVEN
Financial Milestones
2012
2013
2014
2015
2016
Investment
1M
500K
Burn
120K
450K
(How much money needs to be spent when?)
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MILESTONES
WHAT ? WHEN? INVESTED? IMPACT/RESULT?
Past
Past
Past
Past
Future
Future
Future
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ASSUMPTIONS AND RISKS
ASSUMPTION/RISK List some critical assumptions or risks that may affect the realization of revenue and profit projections .in decreasing order of probability (do not include natural disasters, acts of war and such) POTENTIAL IMPACT Across from each assumption, describe the negative impact of each MITIGATION Across from each, now describe what you are doing to mitigate or de-risk
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TEAM

• MANAGEMENT TEAM
• Photos, names, working positions (rather than
  titles)
• NO CEO unless held that title at successful
  company
• Founder is customary
• Startup experience
• Qualifications that suggest success
• ADVISOR TEAM
• Especially important if management has little
  experience or no start up successes
• Photos, names, company logos
• Successes in bringing start-ups to profitability
  and
• exit in your market space and technologies

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VALUATION AND EXIT
Potential Acquirers include Company Strategic
Value Company A Enhance Product Line Company
B Patented Technology Company C Provide
access to New Channels
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SUMMARY

• Three to five points that tell the audience why
  your venture is a great investment
• Superior financial returns quickly
• Advantaged product/service with enough target
  customers who will be compelled to buy
• Product/service validation proof
• Solid barriers against competitors
• The team who will make it happen
• Others

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ENOUGH! for the Intake Panel

• Does not have to be perfect but you have to be
  coachable
• and your venture has to have minimum
  viability to be
• accepted into the SDSI Springboard process
• To be coachable you have to have listen,
  understand,
• not be defensive, do what you agree to do well
  and on time
• Minimum viability means you have completed
  every slide
• in the template (not all the backup slides
  yet!) well
• enough so the Intake screeners see venture
  potential
• Once in, you will get guidance to further
  develop your investor
• presentation from experienced business
  strategists
• One-on-one
• Through milestone panels

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BACKUP SLIDES the real AUDITION

• The investor presentation, when done properly, is
  only 15 minutes
• However, the QA will run 30-60 minutesBULK OF
  THE TIME!
• This time is used to dive into the details that
  are important
• to the investors and that you only skimmed
  over initially
• Many of your front slides are used during QA
• Backup slides are used as needed during QA
• So it is all about anticipating the questions,
  preparing the
• backup slides, finding them quickly, and
  using them to illustrate
• and illuminate the answers you give

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• MARKETING
• 1. BEFORE AFTER List buyer conditions before
  and after
• buying your product/service
• Show what was lacking and what got better?
• Now prioritize from most to least compelling

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• MARKETING
• 2. VALUE PROPOSITION. The most compelling reason
  for a
• a potential customer to buy your
  product/service
• Choose the most compelling Before After case
• Articulate a MANDATORY must have reason to
  purchase
• State the benefit to the customers balance sheet
• Combine the above into a succinct, single
  statement
• Must articulate a value proposition statement for
  each
• customer type separately

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• MARKETING
• 3. DIFFERENTIATION
• Describe what is truly about your product or
  service.
• Describe what your product does that does not
  exist in the
• marketplace today
• Verify those claims with independent data
• Describe what makes that difference sustainable
• Describe how competitors will be held off and
  for how long

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• MARKETING
• 3. DIFFERENTIATION continued
• Describe the benefits these differentiators will
  bring to customers
• and your business competitiveness
• Tell how it will save and how much
• Tell how it will make money and how much
• Tell how it will increase the size of the market
• Tell how it will decrease risk for customers

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• MARKETING
• 4. MARKET SEGMENTATION The size of the market
  must be
• described
• TAM is the Total Available Market
• Describe the total size of the market in the area
  of the
• product or serviceNerf football is the total
  sports
• equipment market
• SAM is the Served Available Market
• Describe the size of the market segment that the
  company
• will actually addressNerf football is the
  segment of the
• TAM that desires a soft football that will not
  injure
• children or cause damage
• segment is a group of buyers who are similar in
  that they
• Have the same problem
• Have the same buying criteria
• Would see each other as credible reference in
  making a
• buying decision

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• MARKETING
• 5. COMPETITIVE LANDSCAPE Helps frame your
  product/service
• and your chances for success. For each
  segment
• Identify the incumbent playersinclude
  workarounds, apathy,
• your target customers internal abilities
• Describe how entrenched is the status quo
• Describe why your competitors are the current
  best solutions
• Describe how the competition has framed
  themselves
• Show your competitors position statements
• Demonstrate how your message is different and
  compelling

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• MARKETING
• 6. BUSINESS MODEL DETAILS
• Identify the segment with the most compelling
  need relative to
• your differentiation in the competitive
  marketplace (this is the
• SAM)
• Show the possible revenue streams for that
  segment
• Show and justify your pricing that fits that
  segment
• Show your pricing relative to the competition
• Explain the likely revenue mix that could be
  achieved
• Explain the most suitable/available channel(s)
  to market
• Show a graphic of how good flow to each customer
  segment
• detailing how and how much money come back to
  you

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• MARKETING
• 7. GO-TO-MARKET PLAN. Tactical issues regarding
  reaching
• your customers and developing sales
• Show the buying processhow purchases are made
• Identify the real buyers and their motivations
  to buy
• What information resources do they use to make
  buying
• decisions
• Explain how you will identify, qualify, acquire
  and convert
• customers
• Explain how your marketing tactics will move
  potential buyers
• through the buying process
• Explain how the buyer prefers to buy and
  therefore how you
• will have to sell
• Identify and justify your sales channels, show
  how they will
• increase your sales, be compensated, be valued
• Prioritize your channels and explain the order

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• MARKETING
• 8. BUDGET Show the cost of acquiring customers..5
  year timeline
• Now that you have developed the go-to-market
  plan, a price for the
• cost to execute on the plan must be developed.
• Develop and show the budget with detailed line
  items with
• researched quotes and bids.
• The budget must include enough capital to
  provide a six-month
• runway of execution on the go-to-market plan.
• Any media programming, P/R, advertising, trade
  shows,
• conferences, and events must be included.
• NOTE the cost of acquiring customer must
  decrease over time

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FINANCIALS Proforma PL Cash Flow
Profitability -- s in 000s Yr 1 Yr 2 Yr 3 Yr 4 Yr 5
Revenue 100 500 2,000 10,000 20,000
COGS(Var. Costs) 50 175 600 4,000 7,000
Gross Profit 50 325 1,400 6,000 13,000
Operating Exp.
- Marketing 40 150 500 2,500 6,000
- Payroll 50 100 350 1,500 2,000
- Other 10 75 100 500 1,000
Tot. Op. Expenses 100 325 950 4,500 9,000
EBITDA lt50gt 0 450 1,500 4,000
Cash Flow -- s in 000s Yr 1 Yr 2 Yr 3 Yr 4 Yr 5
Beginning Cash Balance 50 420 210 350 1,000
EBITDA lt50gt 0 450 1,500 4,000
Working Capital (change) lt70gt lt200gt lt300gt lt800gt lt1,200gt
Investment (change) 500 0 0 0 0
Capital Expenditures lt10gt lt10gt lt10gt lt50gt lt300gt
Ending Cash 420 210 350 1,000 3,500
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FINANCE Actual Comparables
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IP DETAILS
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TECHNOLOGY DETAILS
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PRODUCT DETAILS