1. Are You Ready For Equity Investment?
Don Gooding
Koltai & Co.

2. Five Types of “Investor Readiness”
Equity vs. Bootstrapping, Grants, Debt
Business Model Validation
Metrics Momentum
Ready for the fundraising process
Investors are ready for you

3. 1. Equity vs. Bootstrapping, Grants, Debt
Access to other cash
Equity is “most expensive” if you are successful
Product, business, market dynamics
Long, expensive development cost?
Long business development/sales cycle?
Many competitors, winner take all?
Are you a fit for equity investors?

4. 2. Business Model Validation
Technology
Readiness Level
Problem/Solution
Hypotheses
Product/Market Fit
Validate
Right side of Canvas
Left side of Canvas
Metrics that Matter
Investment

5. 3. Do You Have Metrics Momentum?
Revenue run rate
Total # of customers
Margins
Paying vs non-paying customers
MRR (Monthly Recurring Revenue)
Net Promoter Score
Churn/Retention
ARPU (Average Rev. Per User)
Viral coefficient
CAC (Customer Acquisition Cost)
Time spent using product
LTV (customer LifeTime Value)
CAC < LTV

6. 4. Are you ready for the 12 step fundraising process?
Find potential investors
(Informal) Initial contact with investors
Formal introduction of business concept
Pitch
Deep dive meeting
Resolve deal killers
Due Diligence
Term sheet negotiation
Syndicate formation
Investment document preparation
Closing / cat herding
Money in the bank

7. 5. Are Investors Ready for You?
Equity investment is growing all over the world
African equity market is developing, country by country
Many investors are one country focused
Tech vs. non-tech investors
Early stage vs. later stage investors
Equity vs. debt vs. hybrid

8. Are You Ready?
Have you answered the 19 questions in the accompanying article to convince yourself that equity is right for you?
Has your business model been sufficiently validated?
Do your metrics show sustained momentum?
Are you ready for the 12 step 6-12 month fundraising process?
Do you know what investors are ready for your industry, stage and country?