GlobalEntrepreneurshipWeekCambodia

EVALUATING A BUSINESS IDEA

AND

FINANCING A BUSINESS STARTUP

Emerging MarketsInvestments

EMI

By Mao Savin, Investment Manager of EMIសមាគមសហគ្រិគ�នវ័ យក្មេ �ង ម��ជាYoung Entrepreneurs Association of Cambodia

Contents . 1. Introduction to EMI

2. Evaluating a Business Idea/Westline Case

3. Financing a Business Startup

4. Q&A – Open Floor

IntroductionEMI is an investment manager managing a US$20-million Cambodia-Laos Development Fund (CLDF) investing and building SMEs in Cambodia and Laos.

What is EMI/CLDF?

Our investors are development finance institutions (DFIs)

Our portfolios ranging across the sector as follows

Since its inception, EMI has reviewed over 200 opportunities, evaluated about 100, conducted detail analysis of about 30 and invested in 8 opportunities.

High level review of over 200 opportunities

Evaluation of about 100 opportunities

Detail analysis of about 30

opportunities

8 investments

Introduction How Many Companies/Ideas Evaluated?

Evaluation of a Business Idea

There are six key areas that we focus on in evaluating any investment opportunities and they are as follows…

Market

•What is the market segment? Is there a demand? •Who are customers? •Sales process? Who make the purchasing decisions? •Other factors such economic, demographic…

Competitive Advantages

•Who are the competitors? •What is the competitive advantage? •Is the competitive advantage sustainable?

Timing

•Is the market ready? Is it the right time to start? •What is the status of the product/service? •How long it will take for sales to build?

Scale

•The economic model? •How big the business can be? •How value it can be? •What are the scaling requirements? Can we afford it? •Will the effort worth it?

People

•Vision, passion, commitment? •Can he/she make it work? •Is the team complete and strong? •Do I like him/her?

Exit

•How do I exit from the deal? •Time frame? •Will an exit fit with the team’s goals? •Is my hurdle return achievable?

Key Areas InvestorsEntrepreneurs to Evaluate?

Financing a Startup The “financing life-cycle” of a business typically goes through a number of stages with 3Fs the easiest to access and to begin with…angels probably second…private equity financing; however, is usually the first institutional financing stage.

Startup Financing Cycle

Key Takeaway

Your friends and family…are the easiest and most accessible investors… …but you can’t just go and ask them for $$$...you need a strong and rigorous business case to present them and let them see your passion, confidence and be your first supporter(s)…

If you are willing to dream, dream BIG…do all your best to realize your dream. …when you reach it…you will have another dream which is usually BIGGER…keep CHASING it enthusiastically…

What Are the Key Takeaway?

Determining whether an idea is a real business opportunity is not easy… …but this is the first task you need to do and do it seriously...

សមាគមសហគ្រិគ�នវ័ យក្មេ �ង ម��ជាYoung Entrepreneurs

Association of Cambodia

GlobalEntrepreneurshipWeek

Cambodia

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