Silverpeak IB is authorised and regulated by the Financial Conduct Authority
February 2016
page | CONFIDENTIAL | 2Silverpeak LLP is an authorised representative of Silverpeak Capital Ltd, which is authorised and regulated by the Financial Conduct Authority
INTRODUCTION and CREDENTIALS
Disclaimer
CONFIDENTIAL
This presentation has been prepared exclusively for internal use and does not carry any right of publication or disclosure to any other party. Neither this presentation nor any of its contents may be used for any other purpose without the prior written consent of Silverpeak LLP, trading as ‘Silverpeak technology investment banking’ (“Silverpeak”).
The information in this presentation reflects prevailing conditions and our views as of this date, all of which are subject to change. In preparing this presentation, Silverpeak has relied upon and assumed, without independent verification, the accuracy and completeness of all information available to us or from public sources or which was otherwise reviewed by us.
5
Silverpeak advises innovative, fast-growing technology companies on M&A and financing transactions
Investment bank focused on technology
M&A and financings advisory for growth companies
Vast network of relationships
Global reach, based in London
Blue-chip investment banking service
Silverpeak + overview
FACTSHEET
3 partners with 60+
years of experience
in tech investment
banking
150+ deals and
assignments
completed
15-strong team
Regulated by the
Financial Conduct
Authority
Sponsor of
Go4Venture’s
Monthly Bulletin
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The Silverpeak + team
6
Our team has experience at globally recognised investment banks, and has advised on over 150 deals
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Kieran HallAnalyst Mercer Investments
BAML
MPhil Econ. (Cantab)
Luke EdisAnalyst Crossrail
MSc Finance (Durham)
BSc Physics (Leicester)
Suraj BakraniaAnalyst Jefferies
Barclays
BSc Math & Econ (LSE)
Arthur MaisonnierAnalyst Nordex
Aldebaran Robotics
MEng (ENSAM)
Jean-Michel DelignyManaging Director UBS Warburg
Broadview
MBA (Essec, Paris)
Pietro StradaManaging Director Broadview
Bain & Co.
MBA (INSEAD)
Paddy MccGwireManaging Director 3i
Worksmart
Corporate Capital
Structures
Matteo PozziDirector STAR Capital
Partners
Goldman Sachs
MEng (Turin)
Alexandre de GandtDirector Duff & Phelps
KPMG
Sistech SA
MBA (INSEAD)
Nils ZettelmeyerAssociate CatCap
MEcon
Indicates
Jean-Michel DelignyManaging Director
Jean-Michel is Co-Founder and Managing Director of Silverpeak. He is also thefounder of Go4Venture Advisers, which he successfully built up to a leading position in international equity private placements, especially in the software, telecom and digital media sectors. He has more than 20 years of investment banking and European technology experience
Jean-Michel was previously UBS’ European Head of Technology Investment Banking, where he:
– Set up the European operation of the bank’s Global Technology Group and led deal origination and execution across Europe, Israel and South Africa
– Was responsible for some of the firm’s major technology client wins (including Datatec, FI Group, Freeserve, ICL, Infineon, Marconi Comms, NDS, QXL and Siemens)
Before UBS, he was a Principal at Broadview International, where he worked on over 35 public and private transactions in the technology and IT services sectors
Pietro StradaManaging Director
Pietro is Co-Founder and Managing Director of Silverpeak. He founded Centerboard Partners in 2005, where he sourced and completed 20 mandates, such as trade sales, mergers and financings
Previously, he joined Torch Partners (a technology boutique investment bank) for two years, before re-launching Centerboard in 2014. Here, led the $18m fundraising for Calastone, backed by Accel Partners and Octopus Investments
Pietro was at Broadview (now part of Jefferies) and Corporate Development Director at LexisNexis (a division of Reed Elsevier), where he worked on several high-profile technology M&A andfundraising transactions including:
– The $162m acquisition of BCO Technologies plc on behalf of Analog Devices
Before his MBA, Pietro was a consultant with Bain & Co. and an electronic design engineer with OHB System
Silverpeak + leadership
7page | CONFIDENTIAL
Paddy MccGwireManaging Director, Cobalt
Paddy is Managing Partner of Cobalt Corporate Finance, the London based specialists with partners in the US and Germany, who advise European technology companies to achieve optimum exits and later stage fundraising
In the last year he has completed transactions in enterprise software, e-commerce, IT consulting, AdTech and FinTech
Paddy has extensive experience of creating value and successful deal making in the technology sector over 25 years. With Cobalt as a founding member, he formed the international M&A network Globalscope with active members in 38 countries on every continent except Antarctica. He is also Chairman of Worksmart, the market leader in people centric risk and compliance software.
Paddy’s past experience includes 7 years at private equity group 3i, and at electronics group STC plc
Silverpeak + senior team
8page | CONFIDENTIAL
Alexandre de GandtDirector
Alex joined Silverpeak in 2014 from US-listed advisory firm Duff & Phelps, where he was a Director and played a leading role in setting up their M&A operation in France
Prior to this experience, Alex worked in the Corporate Finance teams of KPMG(Europe’s most active mid-market M&A advisor) and HSBC, where he advised clients including private equity funds, large corporates, growth companies and government agencies
− His advisory experience is further enriched by two hands-on developments of innovative businesses, one of which resulted in a successful exit to private equity post-turnaround
Alex holds degrees from the University of Bristol and La Sorbonne (Paris I), as well as an MBA from INSEAD
He is fluent in both English and French
Matteo PozziDirector
Matteo joined Silverpeak in 2014 where he focuses on M&A and fundraising assignments
– Recently Matteo advised Seatwaveon its sale to Ticketmaster and on the Artesian fundraising
He brings more than 10 years of experience in investment banking, private equity and financing
Prior to Centerboard he was an Investment Director at STAR Capital Partners, a mid-market European Private Equity fund, working on buyout investments across the telecommunication, industrials, transport and energy sectors
Matteo started his career at Goldman Sachs: he was an Associate in the GS Infrastructure Partners, a global infrastructure fund. Prior to that he worked on financing transactions in the Structured & Acquisition Financeteam
Matteo is fluent in both English and Italian (mother tongue)
Nils ZettelmeyerAssociate, Cobalt
Nils joined Cobalt in 2014 where he focuses on M&A and fundraising assignments
He has more than 5 years of experiencein advising on national and international M&A and fundraising. He has advised companies such as Publicis and EPAM on acquisitions and sold software companies to US-listed companies like Broadsoft and Actuate
Prior to Cobalt, he worked at CatCap, a mid-market Corporate Finance house focused on the internet, software, services and technology sectors in Germany
Nils holds a masters degree in economics with majors in game theory and finance
Our presence in the technology sector
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INTERNET & DIGITAL MEDIA ENTERPRISE SOFTWARE & SaaS ENABLING TECH. & SERVICES HEALTHTECH
eCommerce / Marketplaces
Digital Entertainment
Internet Infrastructure
Adtech
Fintech
ERP / CRM / HRM
Security
Databases & Content Management
Materials
Semiconductors / Components
Communication Infrastructure
Electronics / Robotics
Cleantech
Medical Devices
M-Health
Genomics
Diagnostics / Imaging
Healthcare IT
SUB-SECTOR SPECIFIC EXPERTISE
RECENT TRANSACTION EXPERIENCE
Silverpeak has deep sector knowledge and extensive execution experience in internet and digital media
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$11.8m Growth Equity
MAY 2014
$19m Series C
JANUARY 2014
$42m Growth Equity
and Recapitalisation
JANUARY 2012
€15m Series B
JULY 2013
has been acquired by
SEPTEMBER 2013
$8m Series C
FEBRUARY 2014
has been acquired by
OCTOBER 2014
has been acquired by
JUNE 2015
has been acquired by
NOVEMBER 2014
$8m Series B
MAY 2015
has acquired control
ofhas been sold to
AUGUST 2015 JULY 2015
has been acquired by
JULY 2015
has been acquired by
JANUARY 2016
has been acquired by
JULY 2015
has been acquired by
OCTOBER 2015
Broad scope of advisory services
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Growth Equity
Recapitalisations
Secondary Transactions
Venture Debt
M&A SELLSIDE ADVISORY FINANCINGS M&A BUYSIDE ADVISORY BOARD ADVISORY
Roll-ups
Corporates Seeking Strategic Acquisitions
Financial Sponsors
IPO Advisory
Valuations & Fairness Opinions
Portfolio Development
SILVERPEAK TRANSACTION SERVICES OFFERING
Trade Sales
Divestitures
Silverpeak advises on a wide range of transactions which are typically:
- Larger financings involving international investors
- M&A transactions for which our clients value our combination of local support and international reach
Blue-chip investment banking capabilities combined with hands-on senior attention
A wealth of relationships with key stakeholders in the technology ecosystem
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Selected logos shown for illustrative purposes
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IT consulting and professional services
JULY 2015
has been acquired by
Ireland / Ireland
Advisor to System Dynamics
Next-gen orchestration SaaS for Unified Communications
JUNE 2015
has been acquired by
UK / Hong Kong
Advisor to Syntelligence
Workflow software for B2B sales persons
JUNE 2015
Venture debt and equity
financing
UK / UK
Advisor to Artesian
Virtual fitting rooms for clothinge-commerce websites
JULY 2015
has been acquired by
Estonia & UK / Japan
Advisor to Fits.me
Health and personal protection insurance software
JULY 2015
has been acquired by
UK / France
Advisor to Activus
BSS and analytics software for mobile operators in emerging markets
JULY 2015
has acquired control of
Mauritius / South Africa
Advisor to Digitata
Electronic ticketing software for transit, tourism and loyalty schemes
AUGUST 2015
has been sold to
UK / Japan
Advisor to Smart
Transactions Group
Mobile advertising network and supply side platform (SSP)
OCTOBER 2015
has been sold to
Denmark / US & Norway
Advisor to adQuota
Optical fiber protection solutions for FTTx and industrial applications
JANUARY 2016
has been sold to
UK / US
Advisor to m2fx
Silverpeak + completed mandates (selected 1/2)
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More than 150 closed deals and assignments to date
Online marketplace: secondary ticketing platform
NOVEMBER 2014
has been acquired by
UK / US
Advisor to Seatwave
Mobile engagement for consumer-facing companies
JANUARY 2014
$19,000,000 Series C
Ireland / UK, Switzerland & Belgium
Advisor to Brandtone
System integrator of fiber-based city and regional networks
AUGUST 2013
has sold its system
integration BU to
Sweden / Norway
Advisor to PacketFront Int’l
Cell-handling platform for medical applications and research
SEPTEMBER 2013
has been acquired for
€50,000,000 by
Italy / Italy
Advisor to Silicon Biosystems
Cloud-based event ticketing and management software
MAY 2014
Growth Equity Financing
Netherlands / UK
$11,800,000
Advisor to Ticketscript
Open source e-commerce software
JUNE 2014
$7,300,000
Series-B Financing
US & France / Finland & France
Advisor to Commerce Guys
Cloud based, real-time threat detection platform
OCTOBER 2014
has merged with
Portugal / US
Advisor to Anubis Networks
Silverpeak + completed mandates (selected 2/2)
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More than 150 closed deals and assignments to date
Drug delivery company specialised in delivery through autologous red blood cells
JULY 2013
€15,000,000 Series-B
financing led by
Italy / Italy
Focus Gestioni
Advisor to EryDel
Humanoid robots for consumer applications
FEBRUARY 2012
Majority investment
(+$100,000,000) by
France / Japan
Advisor to Aldebaran Robotics
Ultra-fast lasers for research and medical applications
JANUARY 2012
Majority investment
($42,000,000)
France / China & France
Advisor to Amplitude
Fabless semiconductors (manycore processors)
FEBRUARY 2014
$8,000,000 Series C
France / France
Advisor to Kalray
Some of the components of our added value…
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OUR APPROACH
We become an
extension of the
company and the Board
A “fresh pair eyes”
We enhance the equity
story and the
company’s positioning
in its marketplace
We prepare the
company for due
diligence, facilitating
the process with
buyers/investors
We provide perspective
and get management
ready
We help management
to think about their
own business in the
way buyers/investors
will early in the
process
Time leverage CEO and management focus on the business
Communicate the feeling of management’s “time preciousness”
Buyer/Investor selection and pre-qualification Knowledge of the investment community and identification of suitable buyers/investors
Relationships
Documentation and analysis Marketing materials preparation: cover email, teaser, presentation
Financial modelling
Help the company with the analyses that buyers/investors will ask for
Marketing and process management Introductions and follow-ups
Ability to identify the market feedback and address it
Control of information flow
Creating competitive tension
Expertise to negotiate and defend valuations Valuation analysis
Experience on precedent valuations and current market trends
Execution Management of multiple parties
Data room management
Negotiation of closing documents
A
B
C
D
E
F
…and some of our differentiating factors
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Hands-on senior attention throughout the process
Depth of experience: one of the longest established teams
Highest level of professionalism and expertise
Wide-ranging understanding of technology – including IP-rich businesses
International team with experience and familiarity in cross-border deals
Strong belief in the companies we work with
Significant “investment” with companies ahead of signing mandates
Maximum transparency on team members & resources for each transaction
Open & frequent communication to establish trusted personal relationships
Upfront due diligence and preparation that pays off in the final outcome
We are always available for our clients
Many of our
mandates come
from referrals
& introductions
from clients or
parties we have
previously
worked with (or
“against”)
Contents
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Silverpeak + overview p 4
M&A advisory
- Sellside p16
- Buyside p20
Fundraising advisory p24
Approach buyers
Supervise management meetings and assist with Q&A
− Set up management meetings
− Manage A vs. B-list, e.g. present
first to some friendly B-list buyers
to test impact of management
presentation
− Facilitate preliminary DD and Q&A
Review LOIs
− Receive LOIs, counsel with respect
to the adequacy of proposals
− Negotiate preliminary terms
− Select buyer(s)
Silverpeak sellside M&A scope of work
Analyse company & market
− Data gathering
− Analyse addressable market
− Review company positioning & USPs
− Review and refine a 3-5 yr bus.
plan and financial model
Create marketing materials
− Prepare materials and pitch
− Valuation analyses
− List of potential buyers (A-list and
B-list)
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Flexible execution in
each situation to
adapt to market
conditions
Value-added
preparation phase
enhances valuation
and probability of
success
Understand likely
drivers of interest
for each potential
buyer
Flawless process
management and
control of
information flow
achieves maximum
competitive tension
We provide an end-to-end investment banking service to complete the deal successfully
Manage final due diligence
− Support preparation of electronic
data room and manage DD process
Terms negotiation
− Negotiate key value affecting
items in final Share Purchase
Agreement
Legal drafting & closing
− Coordinate with other advisors
− Assist generally in closing the
Transaction
Negotiation and closing(c. 2 to 3 months)
Go-to-market(c. 3 to 4 months)
Preparation & positioning(4 to 8 weeks)
1 2 3
Clear identification of deal rationale: potential revenue synergies
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Thanks to its strategic
and financial knowledge,
Silverpeak value add
includes:
Identifying areas of
value creation in M&A
transactions
Optimally presenting
the drivers of value to
the counterparties
Quantifying and
crystallising the
maximum value during
negotiations
PRODUCTS
New products
(for both)
Target’s products Buyer’s products
CU
STO
MERS
New
clients
and
segm
ents
Long-term
synergiesMid-term synergies
Targ
et’
s clients
Mid-term
synergies
Target as isShort-term
synergies
Buyer’
s clients
Short-term
synergiesBuyer as is
UK market leader in electronic ticketing software and services for concessionary bus and rail travel
CORE PRODUCT PORTFOLIO
Ticketing transaction processing engine
Built to ITSO specification
Card and customer lifecycle management
Multi tenant, enterprise grade, fully integrated with HOPS
TECHNOLOGY-BASED SERVICES
Tools providing behavioural customer insights, incl. route mapping & usage analysis
Portals: white-label ticketing portals (micro-sites) for bus and rail operators
Cloud ticketing: retail network to purchase and top-up smartcards through partnerships including:
100% 100%
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SELECTED CLIENTS
TRACTION
70 million transactions processed per month
60-70% market share outside of London
HOPS integrated to 28,000 smart readers
OWNERSHIP FINANCIALS
Revenues 7.3 7.5
Growth (1%) 2%
EBITDA 1.4 1.5
Margin 19% 20%
2014(A) 2015(B)
FACTSHEET:
Founded: 2002
Employees: 90
Locations: ChippenhamManchesterCardiff
Business model:SaaS delivery, sold via multi-year licenses
Awards & Certifications: FYE 31-Dec, £m
Silverpeak was engaged by Smart Transactions Group following multiple unsolicited approaches for ACT
‒ Indications of interest did not seem to reflect true strategic value from the Board’s perspective
ACT is an established market leader in the smart ticketing market and ITSO software development
‒ Additional investment required to accelerate development of next-generation product portfolio and kick start next stage of growth plan
Smart ticketing represents a substantial market opportunity, with more than 5.2bn bus and 1.6bn rail journeys per year in the UK
‒ Growth opportunities in ticket bundling (transit with tourism ticketing, merchandising and payments) on a single card
Optimised the upfront positioning of ACT by
emphasising its leadership and recurring revenues
Approached a targeted and pre-qualified group of
potential buyers, leveraging existing relationships
Identified areas of interest for buyers and targeted
information flow accordingly
Secured detailed LOIs on terms acceptable to STG’s
shareholders
Co-ordinated the due diligence process and assisted in
the detailed final contract negotiations
Strategic value reflected in the price
Improvement on Board expectations
A highly satisfied client
The deal forms a key component of Fujitsu’s ongoing strategy to invest in the UK transportation market and to build intellectual property in this area
PROCESS RESULTSBACKGROUND
CLIENT TESTIMONY
“Smart Transactions Group decided to appoint a specialist technology investment bank after receiving unsolicited offers for the ACT business”
“Silverpeak's process delivered a number of additional offers for the business on terms that were attractive to Smart Transactions Group”
“Their assistance and knowledge in both the market and the sale process was critical in shaping the deal we completed with Fujitsu”
“We are delighted with the outcome and would recommend Silverpeak to any technology business looking to sell”
PETER MATTHEWS:
Chairman of the Board
1
2
3
4
Electronic ticketing software for transit, tourism and loyalty schemes
AUGUST 2015
has been sold to
UK / Japan
Advisor to Smart Transactions
Group
Contents
page | CONFIDENTIAL 20
Silverpeak + overview p 4
M&A advisory
- Sellside p16
- Buyside p20
Fundraising advisory p24
Initial approach and interest to engage
Identification of value creation opportunities
Selection of higher-probability candidates
Silverpeak buyside M&A scope of work
Reviewing companies’ existing market screening work
‒ Additional mapping of identified growth segments and geographic markets
Prioritisation of potential targets
Preparation of individual approaches
Presentation materials
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Financial and strategic advisory aligned with our client’s acquisition programme
Valuation, analyses and modelling
Negotiation of transaction terms
Transaction team coordination (incl. legal, accounting, tax, HR)
Transaction
development and
process management
Preparation
phaseTransaction
execution1 2 3
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Reference buyside process and indicative timing
22
Combination of
strategic insight and
deal-making skills
Close engagement
and communication
throughout process
− The preparation
phase can be
expedited based on
existing work /
objectives
Strategic-driven
acquisition planning,
with a focus on
identified targets
Timeline from start
to finish: 4+ months
depending on sellers’
& targets’
engagement
Timeline (c. 4+ months)
Kick-off, meet w. management, strategic review
Market segmentation, segment prioritization
Shortlist of prioritized profiles
Initial approaches (rolling)
Meetings
Exchange of information
Indicative offer, LOI
Due diligence
Contract negotiations
Closing
Post-acquisition
Integration
Mark
eti
ng a
nd n
egoti
ati
on
Pre
para
tion
Typical Deliverables
Market research, initial list of targets
- Market map for expansion
- Long list of targets
- Valuation analysis
- Criteria matrix
- Prioritized company profiles
- Presentation materials of
client
- Status report
- Introductory email
- Non confidential presentation
- NDA
- Confidential presentation
- Contribution analysis
- Synergies model
- Valuation analysis (refined)
- Merger model
- Waterfall analysis of client and
merged company (in private-
to-private deals)
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Buyside process considerations
23
Management of information flow
- Repository of information
Status report to be prepared and circulated bi-weekly
(dependent on number of targets pursued)
Corporate checkpointsTiming
Project
Communications
Confidentiality
Set up a confidential project name
Project team, people in the know
- Communication strategy for non-informed personnel
External communication
- Sensitivities of clients and competitors
Standard NDA
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Approach investors
Supervise management meetings and assist with Q&A
− Set up management meetings
− Manage A-list vs. B-list, e.g.
present first to some friendly B-
list investors to test impact of
management presentation
− Facilitate preliminary DD and Q&A
Review offers
− Receive term sheets, counsel with
respect to adequacy of proposals
− Negotiate preliminary terms
− Select investor(s)
Silverpeak fundraising scope of work
Analyse company & market
− Data gathering
− Analyse addressable market
− Review company positioning and
USPs
− Review and refine a 3-5yr bus
plan and financial model
Create marketing materials
− Prepare materials and pitch
− Valuation analyses
− List of potential investors (A-list
and B-list)
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A typical process is
structured in 3 phases:
1. Preparation and
positioning
2. Go-to-market
3. Negotiation and
closing
We provide ongoing
support and time
leverage to the
company during the
transaction:
Project management
Periodic meetings/calls
to review advancement
(status report)
Coordination with
other consultants
General advice
We provide an end-to-end investment banking service to complete the deal successfully
Negotiation and closing(c. 2 to 3 months)
Go-to-market(c. 3 to 4 months)
Preparation & positioning(4 to 8 weeks)
1 2 3
Manage final due diligence
− Support the preparation of
electronic data room and manage
DD process
Terms negotiation
− Negotiate the key value affecting
items in the final Investment
Agreement
Legal drafting & closing
− Coordinate with other advisors
− Assist generally in closing the
Transaction
page | CONFIDENTIAL 26
Providing unparalleled PE and debt financing advice to growth companies
formal engagement
Selected logos only
Late-Stage / Pre-IPOSeries CSeries BSeries ASeed
VC Firms
Banks
Equit
y
Working Capital Financing
Venture Debt Funds
Government & Sovereign Funds
Conventi
onal
Invest
ors
Family Offices
Hedge Funds
UHNWI Funds
Angels & Networks
(Wealth Managers)
Government & Sovereign Funds
Incubators /
Accelerators
Crowd Funding
Corporate Venture & Strategics
Debt
• Venture debt
• Term Loans
• Mezzanine
• Other productsBanks
GP /
LP
Str
uctu
re
PE Firms
LESS C
ON
VEN
TIO
NA
LLESS
CO
NV
EN
TIO
NA
L
Public Equity Funds
Informal support
“Polluting” the market ahead of the process
Selling to investors like selling to clients
Missing the numbers during the process
Speak about valuation and pricing too early when there is not
enough interest
Not enough managers involved; too many employees involved
Provide too much or too little information
Mistakes that Silverpeak will allow you to avoid
page | CONFIDENTIAL 27
Fundraising
usually takes
longer than
expected
Companies often
think that they
already have
good
presentation
materials for
investors
Process requires
careful thinking:
small things can
make the
difference
Starting the process without sufficient financing
Starting too late increasing the risk of running out of money
Starting too early without sufficient demonstration points
Overplaying the cycle: rushing for fund raising when not ready
Go-to-market story too high level
Business plan dependent on new revenue streams that have not
been demonstrated
Limited or no exposure to strongest competitors or global players
Lack of exit planning
Wrongtiming
Weakstory
Mismanaged process