1. A Recovering Entrepreneurial CFO
SPR Consulting, LLC

2. Personal Experience 33 Years Experience, 20 as a CFO/COO
Raised approx. $300M in private equity/venture capital
Drafted an S1 registration for an IPO
Opened 6 foreign offices on 3 continents with contracts in 40 countries
Sat on numerous boards of directors
Taught Finance and Mergers & Acquisitions in the graduate program at John’s Hopkins University
Personal Experience
SPR Consulting, LLC

3. Sean P. Roddy, CPA, CMA, CGMA, MBA sproddy215@hotmail.com 301-518-5410
Contact INformation
SPR Consulting, LLC

4. Outline Entrepreneurial market
Board of Directors (BOD) vs. Board of Advisors (BOA)
Raising equity & the IPO
My two cents
Outline
SPR Consulting, LLC

5. Entrepreneurial Market
Some entrepreneurial statistics
Key Areas of Focus
Cap Table / Capitalization
Meetings
Summary
Entrepreneurial Market
SPR Consulting, LLC

6. Entrepreneurial Market--Stats
BLS.gov
Entrepreneurial Market--Stats
SPR Consulting, LLC

7. Entrepreneurial Market--Stats
BLS.gov
Entrepreneurial Market--Stats
SPR Consulting, LLC

8. Entrepreneurial Market--Stats
BLS.gov
Entrepreneurial Market--Stats
SPR Consulting, LLC

9. Entrepreneurial Market—Key Focus Areas
Organizational Structure
Commingling Resources
Related Party Transactions
Fail Fast
Credit Cards
Payroll and Sales Taxes
Problems and Utilizing Professionals
SBIT/STTR Grants
Entrepreneurial Market—Key Focus Areas
SPR Consulting, LLC

10. Entrepreneurial Market—cap table & Capitalization
Keep it Clean
One Class of Stock
Few Shareholders
Family and Friends
Issuance of Shares
Operations—generate sales/RE
Debt
Grants
Friends and Family
Angels
Customers—as investors
VC’s and Private Equity
IPO’s, Reverse Mergers, PIPE’s
Entrepreneurial Market—cap table & Capitalization
SPR Consulting, LLC

11. Entrepreneurial Market--MEETINGS
Have an agenda
Determine frequency
Communicate responsibilities/expectations
Accountability—periodic evaluations
Listen and don’t waste time
Entrepreneurial Market--MEETINGS
SPR Consulting, LLC

12. Entrepreneurial Market--Summary
Finances and Equity
Meetings
Relationships
Communication
My two cents
Entrepreneurial Market--Summary
SPR Consulting, LLC

13. Board of Directors vs. Board of advisors
Duties & Responsibilities
Time & Commitment
Ethics
Summary
Board of Directors vs. Board of advisors
SPR Consulting, LLC

14. BOD VS BOA--SUMMARY Legal Aspect Ethical Aspect
Remember to ask yourself...
What value do I bring to the board?
Will I have the time to serve the board properly?
If you can’t answer these with a degree of honesty—then decline to serve
BOD VS BOA--SUMMARY
SPR Consulting, LLC

15. BOD Vs. BOA—Duties & Responsibilities
Directors
Advisors
Represent & Protect
Monitor
Render Advice
Appoint, Evaluate and Replace the CEO
Legal Duties
An informal outside group of experts
Provides support and advice
No power or binding legal authority
Owner keeps control of business
Serves at the pleasure of the owner
BOD Vs. BOA—Duties & Responsibilities
SPR Consulting, LLC

16. BOD vs. BOA—Legal Duties of a Director
Duty of Care
Duty of Loyalty
Duty of Good Faith (not a fiduciary duty)
Duty of Full & Fair Disclosure (newest, from DE)
Other Duties
BOD vs. BOA—Legal Duties of a Director
SPR Consulting, LLC

17. BOD vs. Boa--Time & Commitment
Directors
Advisors
Time
Board Meetings – 50 hours
Preparing for Board Meetings – 50 hours
Traveling & Receiving Director Education – 50 hours
Meetings
Golden Rule
Ego Trap
There are no standards for advisory boards. They are purely voluntary and the advisor serves at the pleasure of the founder.
If you’ve established one maximize it’s potential by using it.
BOD vs. Boa--Time & Commitment
SPR Consulting, LLC

18. BOD Vs. BOA--ETHICS Set the tone at the top
Courage, Candor and Conscience
…so long as the actions taken don’t involve fraud, conflicts of interest, or breaches of the duty of loyalty, and we made them in good faith with a reasonable basis for believing the action taken was lawful, informed and in furtherance of the company’s purposes…
BOD Vs. BOA--ETHICS
SPR Consulting, LLC

19. Raising Equity & the IPO
Things to focus on
The Private Equity Markets
The U.S. public markets
The IPO process
My personal experiences
Raising Equity & the IPO
SPR Consulting, LLC

20. Raising equity & The IPO—Things to focus on
Distraction
A Beginning
Dilution & Diversity
Use of Funds
Develop & Protect IP
Raising equity & The IPO—Things to focus on
SPR Consulting, LLC

21. Raising equity & the ipo—The Private Equity Markets
Major trends that have appeared since around 2000
Increase in costs and complexity of being a public company
Collapse of research coverage and liquidity for small capitalization companies
Market focus on short-termism that harms innovative companies with long-term time horizon projects.
These have been good for the VC and PE industry.
Per the NAVC, Q2 ‘18
Raising equity & the ipo—The Private Equity Markets
SPR Consulting, LLC

22. Raising Equity & the IPO—VC transactions per the NAVC Q2’18 report
SPR Consulting, LLC

23. Raising Equity and the IPO—Number of IPO’s in the U.S.
SPR Consulting, LLC

24. Raising Equity and the IPO—Number of Public Companies in the U.S.
5,100—1980
8,100—1996
4,300—2017
30--DOW
500—S&P
30,000,000--??
Raising Equity and the IPO—Number of Public Companies in the U.S.
SPR Consulting, LLC

25. MY two cents Entrepreneurial Pitfalls Source & Use of funds
Establish a Board
Raising Equity
MY two cents
SPR Consulting, LLC

26. Sean P. Roddy, CPA, CMA, CGMA, MBA sproddy215@hotmail.com 301-518-5410
Contact INformation
SPR Consulting, LLC