22573 INNOVATION AND COMMERCIALIZATION Day 4.pdf · Alternative Financing Sources Crowd Financing...

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22573 INNOVATION AND COMMERCIALIZATION

DAY 4

Alternative Valuation Models for Innovation

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• Video – ‘How To: Value a Startup Company’

• https://youtu.be/9dZtuXzJEuM

Alternative Valuation Models for Innovation

• Start ups• Value judgement

– Timing– Team– Idea– Business model

• First steps– P2S – path to sales– P2P – path to profit– P2C – path to cash flow– Much of the above solved the

financial planning phase• Much more qualitative than

quantitative• VC think in terms of portfolio of

investments3

Alternative Valuation Models for Innovation

• Second steps– Identify the cash flow break even time line in terms of

years– Use the traditional DCF method– Do not increase the discount rate to accommodate

risk beyond the relevant industry’s discount rate– Use sensitivity analysis of the cash flow break even

time line

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DAY 4: SESSION 2

Alternative Financing Sources

Alternative Financing Sources

• Source: http://startupguide.com/entrepreneurship/raise-venture-capital/

• Video - ‘Raising Startup Capital’ - <http://www.lynda.com/Business-Skills-tutorials/Raising-Startup-Capital/160363-2.html>

• Remember the importance of pre versus post money valuation -<https://www.youtube.com/watch?v=cTHvnmxFy4s>

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Alternative Financing SourcesCrowd Financing up to $100k•‘Charities’ – donates for no return•Reward type – pre-sale of products/services•Equity based – ownership of the innovation•P2P (peer to peer) lending could be used as a marketing tool•What is Crowdfunding? CrowdFunding planning? What, How, Why and when -<https://www.youtube.com/watch?v=8b5-iEnW70k>

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Alternative Financing Sources• Angel Funding from

about $100k - $2 mil• The following slides

have been printed by the permission of Mathias Kopp, Sydney Angels

• How to raise money from angel investors -<https://www.youtube.com/watch?v=aqRBN7qvyxs>

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12• Hence the portfolio approach

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84%

Alternative Financing Sources• Venture Capital

– Different round of financing

– Continuous dilution of ownership

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Alternative Financing Sources

• Relevant videos– This is a short 4 minute video. Watch it only if

necessary.• Ryan Allis on Raising Venture Capital (The Startup

Guide) - <https://www.youtube.com/watch?v=fvMlP4xNhws>

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DAY 4: SESSION 3

Debriefing and Q & A

Debriefing and Q & A

• Final guideline on the project• Next week Quiz between 9.00 – 9.30 am

on the topics of Day 4

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DAY 4: SESSION 4

Syndicate Group Work

Syndicate Group Work

• Watch the relevant videos if required• Try to value your innovation

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See you next time with your 10 minute pitch

and the full report to be handed in !!