WIP Yale Entrepreneurial Institute (YEI) Early Stage Capital Yale

WIP Creating the Most Possibilities to Excel Tech Boot Camp Start Something Venture Creation Program Summer Fellowship Program (Accelerator) YEI Innovation Fund 2 YEI is equipped to help students start scalable ventures by providing: 1.Funding 2.Resources 3.Mentors 4.Space

WIP 3 ~$2K Growing the Pool of Funds ~$15K ~$100K Academic Year Fellowship Promising start-ups have more opportunities to secure funding Funnel of Start-ups Time Student ventures are eligible for ~ $120K in funding YEI Innovation Fund

WIP YEI Funding Success  Started in 2007  More than 70 companies accelerated  3 companies acquired  $70M raised in outside funding  305+ jobs created  YEI grads have gone onto MassChallenge, Ycombinator, TechStars, etc.

WIP Successful YEI Teams Panorama Education  Aaron Feuer, Xan Tanner and David Carel  $4M Funding – Google Ventures, Zuckerburg, Yale  School systems engaged with students, parents and teachers participating in highly-focused, digital opinion surveys.  2012 YEI Summer Fellows 5

WIP Successful YEI Teams 6 Complex analytics for cloud computing Founded in 2010 by Faculty Member and SOMer 35 Employees Raised $17+ Million Justin Borgman, SOM ’11, YEI ‘10 Dr. Daniel Abadi, Computer Science

WIP NSF, NIH Academic Academia Small Business Investors Industry Valley of Death Resources Available ($) Discovery DevelopmentCommercialization Level of Technology Maturity From Angus Kingon Funding Technology Innovation SBIR AngelVenture CapitalSenior Debt

WIP Venture Capital Threshold Angel Capital Threshold Economic Development Funds Threshold NSF SBIR/STTR Threshold Technology Risk Market Risk People Risk Finance Risk Friends, Family (and Fools) Threshold What is your Enterprise Risk Profile? Senior Debt Threshold

WIP Bootstrap Techniques What you have in your pocket! Pros + Protection of Entrepreneur’s Equity + No Outside Oversight + Low Cycle Time and Transaction Costs + Certain Consulting Activities May Augment Technology Development Cons - Self-Funding Brings High Level of Personal Exposure -Consulting May Dilute Core Development Activities -Licensing May Erode Downstream Revenue Potential -Equity-for-Service Trades Dilute Entrepreneur Ownership

WIP Federal and State Funding SBIR, STTR ($3B available annually) and other grants Pros + Non-Dilutive + May Offer Federal Customer Entrée + Potential Adjunct to Development Roadmap and Business Direction + Clear Milestone Expectations + Validating of Technology Direction Cons -Government Funding Sources May Bring Less Business Expertise Than Equity Investors -If Grants Define and Drive Development Roadmap and Business Direction, Cancellation of Requirement Could Leave Business Without a Customer -Generally Insufficient to Bridge “Valley of Death” -May Not Be Anchored to End-User Requirements -Not All States Offer Incentives

WIP  BioHaven Event (November)  Office Hours – –Dec. 4, 11 – Merrie London from CT Innovations  SBIR “How To” – February *** Additional Resources Available 11 Yale Support for SBIR/STTR

WIP Angel Investment >2M individuals w/ Net Worth > $1M “Qualified Investors” May have investment motivations beyond Rate of Return (ROR) Various structures – Angel funds, Individuals, Super Angels Pros + May be Active Advisors + May Assist in Business-Building Activities + Less Structured Monitoring and Control than Venture Capital + Shorter Due Diligence Cycle than Venture Capital + Relatively Loose Terms and Conditions + Option Pool Likely not Required + May be Widely Accessible Cons -May be Active Advisors -Valuation Sensitive -High Expected Rate of Return (ROR) -Limited Ability to Support Follow-On -Availability / Access Subject to Macroeconomic Climate ** TERMS VERY IMPORTANT TO POSITION COMPANY FOR DOWNSTREAM CAPITAL**

WIP Venture Capital Private Equity Class Focused on Funding and Building Early Stage, High-Growth Enterprises Pros + Investment Validates Business Plan + Adds Significant Value to Business + Ability to Significantly Assist in Business-Building Activities + Well-Structured Terms and Conditions Designed to Balance Management and Investor Objectives + Assistive in Finding Follow-On Financing Cons -Extensive Due Diligence Cycle -Heavy Company Monitoring and Control -High ROR Expected -Moderately – Highly Dilutive -Expectation of Preferred Stock -Option Pool Required

WIP Strategic Partners Any alliance between commercial entities that furthers business interests (Formal to informal) –Financing –R&D –Marketing / Sales / Distribution Pros + Able to Add Meaningful Business Value + Able to Assist in Business Building Activities + Source for Technology, Market, or Business Model Validation + Numerous Industry contacts + Investment from Partner May Be Relatively Valuation Insensitive + Expect Lower ROI + courtship by Prospective Acquirer Cons -Restrictive Terms and Conditions -May Require Certain Preferences to the Business Partner -Can Sometimes Limit Attractiveness of Company for Future Investment

WIP Panelists “Advice for Accessing Early Capital” Kyp Sirinakis – Managing Partner, Rock Spring Ventures Adrian Horotan – Principal, Elm Street Capital 15

WIP Resources  National Venture Capital Association. Provides listings of venture capital firms and entrepreneur education.  Kauffman Foundation Entrepreneurship Resource Center. Education on the A to Zs of business, including venture capital.  National Associate of Seed and Venture Funds. Provides lists of state venture capital funds and other resources.  Angel Capital Association. Provides lists of angel groups.  Small Business Administration (SBA). Connecticut Innovations CVG