Powerhouse Games. Peter Præst worked 100% in the last 14 months with PHG and is the founder

Transcription

1 Capital for winners

2 Powerhouse Games Strong and very experienced founder Strong SW platform Low burn rate Contacts and initial interest from Nintendo distributor and MP3 player producers 30% of equity share How do Capital+ add value Customer / Channel Relationships Define the right focus. Support with negotiations on major contract. Microsoft Media Center contact Peter Præst worked 100% in the last 14 months with PHG and is the founder PHG has built a framework (platform) for efficient distribution to multiple hardware form factors Target market is handheld media player devices, Nintendo DS, Wii, Set-top boxes, mobile etc. Upside market: Mp3 players, Media centre, and other unexploited hardware platforms Total market growing rapidly and has multiple channels Management Team Recruiting Bandwidth Private Investor Profiling the need of the company, Interview with key candidates. Board member from IO Interactive Weekly meeting with Capital+ Access to IO Interactive 2

3 My CV Jakob Sand CEO of Capital+ SEED Capital Microsoft Dansk Internet Selskab University of Copenhagen media & language CBS E*MBA chapter 10 Marketing Sales Strategy Product innovation Software development Internationalization Start-up Internet, Software, Consultancy, Mobile, home entertainment

4 Investment size Development Introduction Growth Maturity Decline Successful Multiple X s The Private Equity market a fund for every stage Private equity because you are not on the stock exchange Fast, longer term, less fluctuation Venture Capital = higher risk & less equity share Venture Capital= high growth industries Visit for info on specific funds 5-10mio. 2-3mio. 0,2mio. BA & Gov. Capital+ Classic Venture Capital Buy Out Private Equity Time 4 *Source Ernst &Young: Global VC Insight 2007 & : EVCA Anuall investment analysis

5 High risk portfolio approach

6 Typical venture capital investment areas IT and telecommunication Bio (MedTech, Drugs etc). Nanotech Green/Clean tech High growth and high potential IP driven ROE - Return On Empowerment 6

7 10 typical misunderstandings 1. If I get venture capital they will own 51% or more! 2. If my product has no competitors I have a better chance of getting VC investments 3. The VC guys wants to step in and run my business on a daily basis 4. The VC will steal my innovative idea 5. It is best to let the VC decide on the strategy going forward 6. I (the king!) has to be CEO forever 7. Patents are expensive and not worth their money 8. A Venture Capital investment is a loan that has to be paid back and then I get my company back 9. I will stay in my well paid job until I get the right investor to pay me the same salary in the new start-up 10.The less money I ask for the better are my chances of success ROE - Return On Empowerment 7

8 Investment process Overall investment criteria fit Geo Industry ValueProp Technology, Market, Team, Patent, Phase fit Software as a Service Business, Tech & Patent Due Diligence Team Market Technology Scalability Price Software as a service covers solutions and offerings that deliver Founder software & and applications to the endcustomers Capital+ as create a service via the web. This can be either investment case b2b or b2c solutions, however our main focus is b2b solutions. Special attention is given to B2SMB services. ScoreCard KPIs ROI Milestones Budget IP quality Freedom to operate Radical new internet based solutions The so-called radical innovations leverage the internet as a distribution platform of technology and radically change ordinary business as we know it today. Commercial Financial Shareholder Sales & Marketing Term Sheet negosiation Did we pay the Can we keep Mediators and aggregators righ price? key persones? One of the most evident values of the ICT is the possibility for websites and solutions to connect Investment case inequalities between demand Balanced and supply Reporting efficiently. definition Scorecard levels Within (riskmng.) this area Capital+ focuses on portals offering new value to consumers globally by leveraging the internet portals. Formal Due Dilligence & Termsheet -> Investment Agreement Can we influences Home entertainment Can we exit? and gaming business? With LCD and flat screens ICT business has moved out of the office and into the living room. The most prominent example in the home applications market Deviations Actions is online gaming done through game consoles like PS2 and XBOX. Currentl potential infrastructure solutions are Shareholder CompanySheet Agreement emerging while software and content for home use is very small. Deal done Let s conqour the world Reporting Execution actions

9 Pitfall: The team Overall investment criteria fit Geo Industry ValueProp Technology, Market, Team, Patent, Phase fit Team Market Technology Scalability Price Founder & Capital+ Experience create investment case Results Business, Tech & Patent Due Diligence IP quality Personal power Personal insight Term Sheet negosiation ScoreCard KPIs ROI Milestones Budget Did we pay the righ price? Freedom to operate Can we keep key persones? Commercial Financial Shareholder Can we influences business? Can we exit? Sales & Marketing Investment case definition (riskmng.) Rule of thumb Attract customers Formal Due Dilligence & Deal done Balanced Scorecard Termsheet -> Attract employees Attract new investors Let s conqour the world Reporting levels Deviations Actions Investment Agreement Reporting Shareholder Agreement Execution actions CompanySheet

10 Pitfall: Market Overall investment criteria fit Geo Industry ValueProp Technology, Market, Team, Patent, Phase fit Team Market Technology Scalability Price Market dimensions Nice, Need, New or Never? Founder & Capital+ create investment case Business, Tech & Patent Due Diligence Term Sheet negosiation Investment case definition (riskmng.) Formal Due Dilligence & ScoreCard KPIs ROI Milestones Budget Freedom IP quality to operate Commercial Financial Shareholder Market size and accessibility Segmentation Did we pay the righ price? Competitors Can we keep key persones? Can we influences business? Can we exit? Balanced Distribution Reporting levels Deviations Actions Scorecard Go-to-market strategy (COS) Termsheet -> Investment Agreement Shareholder Agreement CompanySheet Sales & Marketing Deal done Let s conqour the world Reporting Execution actions

11 The Investment process Overall investment criteria fit Geo Industry ValueProp Technology, Market, Team, Patent, Phase fit Team Market Technology Scalability Price Founder & Capital+ create investment case ScoreCard KPIs ROI Milestones Budget Business, Tech & Patent Due Diligence IP quality Freedom to operate Commercial Financial Shareholder Sales & Marketing Term Sheet negosiation Did we pay the righ price? Can we keep key persones? Can we influences business? Can we exit? Investment case definition (riskmng.) Balanced Scorecard Reporting levels Deviations Actions Formal Due Dilligence & Termsheet -> Investment Agreement Shareholder Agreement CompanySheet Deal done Let s conqour the world Reporting Execution actions

12 Term Sheet Key business drivers Keep key personas Protection of investment (price) Control of the investment Exit

13 Key questions to thing prepare 1. Why would anybody pay for your product (how many are there?) 2. How will you reach the possible payers of your products? 3. How do you stay competitive (how easy are you to copy?) 4. Why are you and your team the right combination of competences? 5. What company is going to buy your company later? 6. Have you created a prioritized investment plan? 7. Du you know every detail of you business or do you have black spots? 8. Why do you need VC money? Have you tried the bank? 9. Are you prepared with printed slides for every meeting with you VC? 10.Have you prepared your self for a 3-6 months fund raising period? 11.Have you activated you network?

14 Go for it! - Today In a cloud of money anything is possible Cash is king! What if everything goes wrong! Nobody go bankrupt in Denmark (almost) Action = Success No more what if YOU can do a difference every day Start today! ROE - Return On Empowerment 16

15 Thank you! ROE - Return On Empowerment 17