1. 1 How to Successfully Present to Investors Larry Chaityn Keiretsu Forum Lchaityn@keiretsuforum.com Kaminski-Partners lchaityn@kaminski-partners.com

2. Background E&Y, Cap Gemini, Oracle Keiretsu Forum Worlds Largest Angel Investment Group 24 Chapters, 900+ Investors Kaminski-Partners Merchant Bank (IB + Fund) Dan Kaminski, Harvey Krueger, Carl Page, Yechiam Yemini Life Sciences – Technology – Clean Tech Barclays 2

3. 3 The product matters far less to most investors than reactions of customers, the properties of the market, and the credibility of the team. Obsess about the product on your own time; present your business in all it s parts Marc Hedlund, Founder Wesabe

4. 4 Sequence & Flow Do a Demo 1st Then Tell a Story We have a focused mission We have a proven team to take us there We have uncovered a large problem We have solved the problem using this product with great technology inside We are going to market & sell it to these specific customers With these advantages over the competition We are working toward these milestones over the next few quarters In conclusion, this financing is a great investment opportunity.

5. 5 Your Company Name Logo Tagline Raising $X Copyright 2011 Keiretsu Forum NY

6. SUMMARY WHAT WE DO (Use an analogy that people understand) Fitness as a social game Copyright 2011 Keiretsu Forum NY

7. TEAM Highlight past accomplishments of the team (and advisors). Highlight past accomplishments of the team (and advisors). Why this is a world-class team with relevant skills to pull this off? Why this is a world-class team with relevant skills to pull this off? Why they can recruit from their networks? Why they can recruit from their networks? What have they done before that is special and relevant? What have they done before that is special and relevant? Have they done it before or are they learning on the job? Have they done it before or are they learning on the job? Copyright 2011 Keiretsu Forum NY

8. PROBLEM WE ARE SOLVING Who is the customer? do they matter? what problem does the customer have today? why is that a big problem, why is it their biggest problem? Who is the customer? do they matter? what problem does the customer have today? why is that a big problem, why is it their biggest problem? Emphasize the pain level and the inability of competitors to satisfy the need. Copyright 2011 Keiretsu Forum NY

9. THE SOLUTION What is your solution? why is it unique? why has nobody done this before? What is your solution? why is it unique? why has nobody done this before? What has changed that allows room for a startup here? What has changed that allows room for a startup here? software, or pictures Include a demo such as a screencast, a link to working software, or pictures Copyright 2011 Keiretsu Forum NY

10. TECHNOLOGY What is the technology behind the solution? How does the technology enable the solution to be differentiated? Patent status. What is the technology behind the solution? How does the technology enable the solution to be differentiated? Patent status. If big IP piece, one slide on the state of technology development If big IP piece, one slide on the state of technology development Copyright 2011 Keiretsu Forum NY

11. MARKETING Your total addressable market. In other words, what your revenue would be if you got 100% of your target customers paying what you expect? Your total addressable market. In other words, what your revenue would be if you got 100% of your target customers paying what you expect? Is this market big enough to yield a highly- valued company. Is this market big enough to yield a highly- valued company. How will you acquire them? How many have you acquired already? How will you acquire them? How many have you acquired already? Copyright 2011 Keiretsu Forum NY

12. MARKETING; Go to Market Strategy How will you get in front of the customer? Direct, Indirect, Distribution, etc. How will you get in front of the customer? Direct, Indirect, Distribution, etc. Integrated Social Networking & Mobile Strategy. Integrated Social Networking & Mobile Strategy. Is there a channel that can allow this company to get their product to customers profitably? Anyone in the way of this startup reaching their customers? Is there a channel that can allow this company to get their product to customers profitably? Anyone in the way of this startup reaching their customers? Copyright 2011 Keiretsu Forum NY

13. SALES What they will pay? What they will pay? What will it costs to service them? What will it costs to service them? What will it cost to acquire them? What will it cost to acquire them? Copyright 2011 Keiretsu Forum NY

14. 20092011201220132010 (K) Copyright 2011 Keiretsu Forum NY ADOPTION CURVE (Projected) Registered User Adoption Curve: Launch – 2013

15. COMPETITION Matrix of the competition with the two variables that matter on the X and Y Matrix of the competition with the two variables that matter on the X and Y How is the company positioned in the landscape with all the other companies I've seen? How are companies in this category valued? Do I know about competitors that these guys don't have listed? How is the company positioned in the landscape with all the other companies I've seen? How are companies in this category valued? Do I know about competitors that these guys don't have listed? Copyright 2011 Keiretsu Forum NY

16. COMPETITION SPECIFICS The top 2 or 3 competitors, one/two liner on their story (funding, etc), one/two liner on why you beat them. The top 2 or 3 competitors, one/two liner on their story (funding, etc), one/two liner on why you beat them. Do I believe these guys can win? Who are the two or three competitors to focus due diligence efforts on? Do I believe these guys can win? Who are the two or three competitors to focus due diligence efforts on? Copyright 2011 Keiretsu Forum NY

17. MILESTONES Each round of financing targeted at meeting certain milestones to increase the value of the company. Each round of financing targeted at meeting certain milestones to increase the value of the company. Current status & prospective milestones for the next 1-3 quarters for; product, team, marketing, sales. Current status & prospective milestones for the next 1-3 quarters for; product, team, marketing, sales. What hypothesis did you test in the last round of financing and what were the results? What hypotheses will you test with this round? What hypothesis did you test in the last round of financing and what were the results? What hypotheses will you test with this round? What happens when? beta, first customer shipment, break- even cash flow, etc. What happens when? beta, first customer shipment, break- even cash flow, etc. Copyright 2011 Keiretsu Forum NY

18. FINANCING How much went in so far, when, at what price? How much went in so far, when, at what price? How much are you raising now and at what valuation, how big is the unallocated pool? How much are you raising now and at what valuation, how big is the unallocated pool? Cap Table: Who are current investors, how much do they own, who is on the board, Cap Table: Who are current investors, how much do they own, who is on the board, Copyright 2011 Keiretsu Forum NY

19. 19 Use of Funds Sales List the team & $ Marketing Specific marketing initiatives Expectation per initiative: Adoption Expectation per initiative: Revenue Etc Copyright 2011 Keiretsu Forum NY

20. 20 CONCLUSIONS What the company could accomplish if these current plans are realized 20 Copyright 2011 Keiretsu Forum NY

21. 21 Appendix Comparables Valuation Mechanics

22. COMPARABLES Companies in and around the space, valuations, revenues, gross margin Companies in and around the space, valuations, revenues, gross margin Will this be a valuable company if they execute? Will this be a valuable company if they execute? Ideal: There are obvious big, well-valued companies around who would try to buy the company. All valued at very high multiples, but an underserved segment that allows a startup to build a valuable company Ideal: There are obvious big, well-valued companies around who would try to buy the company. All valued at very high multiples, but an underserved segment that allows a startup to build a valuable company Copyright 2011 Keiretsu Forum NY

23. Valuation Mechanics Startup valuation is part art and part science; and, Your company is worth is what the market will pay for it. Based on industry success metrics Platforms 100,000 registered users = some traction 1Million registered users = industry interest 23 Copyright 2011 Keiretsu Forum NY

24. Valuation Mechanics DCF Little to no cash flow history Cost to Replicate doesnt fully capture the future potential doesn't reflect the value of intangibles like the brand Market Multiple looking at recent sales or offerings of comparable companies very difficult to find accurate data Copyright 2011 Keiretsu Forum NY 24

25. Valuation MechanicsStage of Development StageInvestorsValuation Concept/Business Plan Friends/Family$250K-$1M Technology Developed Angels/Seed VCs$1M -$5M Launch/Early Customer Traction Seed VCs, Series A VCs $5M - $15M Scaling & Adoption (Negative EBITDA) Series A, B or C VCs$15-$30M+ Rapid Expansion (Positive EBITDA) Exit (M&A) or IPO$40+M 25