The Crowd Funding Revolution What it is and Why it Matters

About me 2 President + Co-Founder at Fundable Crowd funding platform for small businesses. Founder at IdeaBuyer.com Online marketplace for intellectual property. President + Founding Team at Startups.co 400,000 Members, 20,000+ Active Accredited Investors Eric Corl Eric Corl | © 2013 Fundable.com

Our Company 3 Crowdfunding Platform for Businesses Funding at Scale 22 Employees ESPN for Startups Office Made for Entrepreneurs

Our Vision 4

Quick Tour 5

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Why Is Entrepreneurship Important? 9 -Pay 45% of All Private US Payroll -Create 90% of the new jobs in America -Create 4,000 new jobs on an average day -Hire 40% of high tech workers -Provide 55% of all jobs.

Important But Neglected 10 Less than 1/3 of professional investments are at the seed stage. Most companies cannot raise money from professional sources until they no longer need it. Big delta in the impact small businesses have and the funding available to them.

Traditional Funding Options 11 Friends & FamilyVenture CapitalAngel InvestmentsBank Loans Eric Corl | © 2013 Fundable.com

Funding Options 12 Friends & FamilyVenture CapitalAngel InvestmentsBank Loans Eric Corl | © 2013 Fundable.com $60bb

Funding Options 13 Friends & FamilyVenture CapitalAngel InvestmentsBank Loans Eric Corl | © 2013 Fundable.com $60bb$20bb

Funding Options 14 Friends & FamilyVenture CapitalAngel InvestmentsBank Loans Eric Corl | © 2013 Fundable.com $60bb$20bb

Funding Options 15 Friends & FamilyVenture CapitalAngel InvestmentsBank Loans Eric Corl | © 2013 Fundable.com $60bb$20bb $14bb

Friends & Family 16 Friends & Family Eric Corl | © 2013 Fundable.com Pro’sCon’s Quick to attainPotential Losses Typically hands offStrained Relationships

Angel Investments 17 Eric Corl | © 2013 Fundable.com Pro’sCon’s Larger ChecksBusiness Involvement SophisticationAnswering to Someone Additional Value Day Close 91 out of Every 10,000 co’s

Venture Capital 18 Eric Corl | © 2013 Fundable.com Pro’sCon’s Large ChecksLost Control Inside BaseballHeavy Dilution Earning Handcuffs 4 out of Every 10,000 co’s Industry Limited Rarely Seed Stage

Bank Loans 19 Eric Corl | © 2013 Fundable.com Pro’sCon’s No DilutionDebt Service Costs Quick ClosingPersonally Guaranteed Rare for Startups Brick & Mortar Centric

Funding Options 20 Friends & FamilyVenture CapitalAngel InvestmentsBank Loans Eric Corl | © 2013 Fundable.com $60bb 57% $17k $20bb.0091% $230k $22bb.0004% $800k $14bb.016% $145k

Why Are They So Low? 21 Geographically & Industry Limited Impersonal, Weighted Risk Biggest – Restrictions on the Public

Biggest Issue 22 It is illegal for the average person to invest in a private company. Prohibited by SEC restrictions. Millions of Potential Investors Cannot Invest

How Is This Changing? 23 Advent of Crowdfunding The Passage of the JOBS Act Re-Introducing the consumer into the funding process.

What is Crowdfunding? 24 crowd funding - Eric Corl | © 2013 Fundable.com the practice of funding a project or venture by raising money from a number of people, typically via the Internet.

Crowdfunding 25 Eric Corl | © 2013 Fundable.com Pro’sCon’s Validate Your BusinessCompetitor Exposure Build Traction Build Social Proof Publicity Gain Investor Interest No Dilution

Crowd Funding Now $1.4 BB Eric Corl | © 2013 Fundable.com 2012 $2.8 BB

Types of Crowdfunding 27 Rewards Equity Offer pre-orders Typically raising < $50k Anyone can back you No equity dilution Offer equity stake in company Typically raising $50k to $10MM Accredited investors only. Must issue stock in company.

The History 28 History The Internet The Legislation Eric Corl | © 2013 Fundable.com

The JOBS Act 29 Eric Corl | © 2013 Fundable.com Jumpstart Our Small Business Act Signed into law April 2012 ("the crowdfunding act“) Aims to decrease barriers to entry for startups Passed in the Senate Passed in the House

Two Main Impacts 30 1.It Removes the Ban on General Solicitation 2.It Gives Most Americans the right to invest in private companies. Eric Corl | © 2013 Fundable.com

General Solicitation 31 Before: Pitching equity raises could only be done privately to accredited investors or within entrepreneurs' personal, private networks After: General solicitation of equity raises is permitted. Effect: Entrepreneurs visible to thousands more investors More investment opportunities for everyone Anyone can own a piece of a company and diversify how they invest Eric Corl | © 2013 Fundable.com

Accredited Investors 32 Fact: 3.4mm N. Americans = accredited investors in 2010 Approximately 233.7mm N. Americans = accredited investors after JOBS Act Eric Corl | © 2013 Fundable.com

The #’s In Perspective 33 Americans Gambled Over $550 Billion Last Year American Public Has a Net Worth of $50 Trillion+

What It Does 34 Will Democratize Funding for Entrepreneurs Open Up Trillions In New Funding Will Bridge the Funding Delta Eric Corl | © 2013 Fundable.com

How It Impacts You 35 Helps more great companies get started and grow, regardless of where they are based. States Like WV will have a competitive advantage.

Examples of Crowdfunding CompaniesRaisedTime Fleksy $900,000 3 Months Training Mask $20, Days 3D-Vision $24, Days Seeds $25, Days 36 Eric Corl | © 2013 Fundable.com

Fleksy 37 Eric Corl | © 2013 Fundable.com Problem Solution Market Size Traction Team

BodBot 38 Eric Corl | © 2013 Fundable.com Problem Solution Market Size Traction Team

Start Crowdfunding 39 -Elevator Pitch & Description -Funding Goal -Compelling Rewards -Profile Visuals

Marketing 40 -Friends & Family -Community -Industry Bloggers & Journalists -Social Media Networks

It Isn’t Just About Funding 41 -Market Validation -Meet Potential Partners -Invaluable Press -Social Proof -Meet Potential Investors

Resources 42 Eric Corl | © 2013 Fundable.com LinkedIn: Linkedin.com/in/ericcorl 2012 Funding Review JOBS Act Infographic

Recommended Reading 43 How to Write the Perfect Pitch What Are Investors Looking For?