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Common Elements of Debt Financing. Typically governed by a loan agreement – a “promise” to repay the debt, a promissory note A fixed credit limit = amount of the loan Interest rate fixed or variable The loan’s time period Payment dates for principal and interest Any late payments Fees charged by the lender Collateral description Prepayment Other requirements such as monthly, quarterly or annual financial reports Interest expense and out of pocket costs to get debt financing are deductible expenses Key: has no ownership in the business and doesn’t participate in its earnings

Additional Documentation Ownership formation Cash infusion or cash injection Collateral Business plan Financials Lease Personal guarantee Other pertinent business items

Investors: FFF, Angels, & VCs Friends, Family, and “Fools” Individuals & Angels Venture Capitalists An Investor will expect a Return on Investment (ROI) and will take a stake (equity) in your company. Some investors may exercise a board seat, engage as advisors, offer access to their networks, and actively support the growth of the business while others may be “silent” partners.

Angel investing: Risk profile of various asset classes Seed funding/FFF Angel investing (JumpFund) Private equity Commercial real estate Return on investment (%) Small cap U.S. equities Large cap U.S. equities Corporate bonds/ MBs Money market funds U.S. Treasury bills Risk (Low to high) Source: Adapted from Golden Seeds “Angel Investing Series 2013” www.thejumpfund.com

Investment Criteria Common Themes: Strong management team/founder Scalability Market Potential/Differentiation Customer Discovery/Early Traction Exit potential: 10-20x return on investment within 3-5 years JumpFund: Woman-owned, C-level position, significant equity in company Scalable to min $20mm within 5 years; strong ROI potential Sustainable revenue model; customer traction; market opportunity Located within SE region

Chattanooga & Regional Investor Landscape Seed Capital: Brightbridge (Women Entrepreneurs Center), TSBDC, ACE (Access to Capital for Entrepreneurs, N.GA), Pathway Women’s Business Center (Nashville) “Angel” Investors: Individuals, JumpFund, Blank Slate Ventures, Solas Ventures, Chattanooga Renaissance Fund, Spartan Ventures Angel Capital Group (Knoxville), Angel Roundtable (Nashville Area), Lighthouse Fund (Knoxville), JumpStart Foundry (Nashville) Venture Capital: LaunchTN (Incite Fund), Nashville Capital Network, LampPost Group, Meritas Ventures (Tullahoma)