LIGHTER CAPITAL © COPYRIGHT 2015

Funding OptionsFor Growing Technology CompaniesAWS Loft, San Francisco

BJ Lackland CEO, Lighter Capital@bjlackland

LIGHTER CAPITAL © COPYRIGHT 2015

About BJ LacklandLighter Capital: CEO since 2012 

Power Efficiency Corporation: CFO & DirectorPublic energy technology company, raised $20M in equity financing, $5M in various debt financings

Summit Energy Ventures: VP & Director (Partner)$25M venture capital fund focused on Series A & B rounds, PIPEs, convertible debt

Other: Active angel investor and consultant to early stage companies. Senior finance and marketing leader at tech startups, EnCompass Globalization and webStrategic.

MBA and MA in International Studies from University of Washington

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BJ Lackland, CEO Lighter Capital

15+ years financing early stage tech

companies, either as an entrepreneur or investor.

Over $50M raised or invested

LIGHTER CAPITAL © COPYRIGHT 2015

About Lighter Capital

52%25%

21% SaaS

SaaS + Service

Tech-enabled services

Digital Media

›100+ financings across 70+ companies

›Almost 80% are SaaS

›Revenue Based Financing for tech companies

›$50k-$1mm+ funding per company

›Technology + Capital = Better for Entrepreneurs

LIGHTER CAPITAL © COPYRIGHT 2015

› The best of debt and equity – aligned interests with no dilution

› Essentially a royalty agreement until a fixed $$ amount paid

› Monthly payments = fixed % of revenue

› Fits SaaS very well

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What is Revenue-based financing?

1 2 3 4 5 6 7 8 9 10 11 12 13 14Period

Company revenueLoan payment Criteria:

› Revenue: $15k-$1m/ month

› Profitability: Not required, but clear path to profitability

› Multiple Customers

› Recurring Revenue/Customers

› High management ownership

› U.S. focus

LIGHTER CAPITAL © COPYRIGHT 2015

Today’s Agenda

The funding landscape

Your funding paths and options

Preparing for funding

Q&A

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LIGHTER CAPITAL © COPYRIGHT 2015

The Funding Landscape

Cost of Entry

Speed of Innovation

More Startups

Angels/VC

Larger Funds

Series A is The New B

Other Sources

Corporate Venture

Debt + Crowd funding

LIGHTER CAPITAL © COPYRIGHT 2015

VC Backed Non VC

Revenue$5m

Series B

Corporate Venture

Established

Ideation

Launch & Traction

Growth & Scale

Breakout

Series C

Debt

Equity

Tech Banks

Series A Revenue-Based

Financing

Blended

Series A

Series B

Tech Banks

Series C

Revenue-Based Financing

Tech Banks

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Funding Paths

Bootstrap / Friends & Family

Incubator / Angels

LIGHTER CAPITAL © COPYRIGHT 2015

Bank / Debt Revenue-Based Finance

Venture Capital

Guarantees &Controls

Financial CovenantsSometimes Personal

Guarantees

No Financial CovenantsNo Personal Guarantees

Partner in the Business (Board Seat, Voting

Rights)

Added Value Low / None Medium High

Dilution None / Low None High

Payment Flexibility

Low: Fixed Payments

Medium: Variable Payments

High: No Payments

Speed 4-8 months 4 weeksHighly variable. Typical 3-9 months of focused

effort

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Funding Option Comparison

LIGHTER CAPITAL © COPYRIGHT 2015

1. Equity Valuation? What % to give up for the capital?

2. Control/Partnership Who makes key decisions?

3. Value Add More than just money? Accelerate value?

4. Risk Tolerance Personal assets?

5. Timeframe/Distractions How long will raising funds take?

6. Horizon Exit strategy? Build to exit? Build and hold?

7. Culture Is there alignment? p9

Selecting a Funding Path

LIGHTER CAPITAL © COPYRIGHT 2015 p10

Know Your Numbers› Actual historical › Projections & assumptions› Key SaaS metrics› Capitalization

Document Your Company› Executive summary› Investor deck › Supporting slides / deep info› Product demo

Get Ready for Funding – the ChecklistTake Action

› Activate your network › Legal + accounting prep› Keep momentum / sense of

urgency

LIGHTER CAPITAL © COPYRIGHT 2015 p11

Financials› MRR (Monthly Recurring

Revenue)› Burn rate› Zero cash date

Customer Metrics › Acquisition costs: CAC, CAC

Ratio, CAC Payback › Customer value: ACV, LTV› Churn

Key SaaS MetricsGrowth

› Monthly and annual revenue growth rates› MRR/ARR growth rate

› 40% rule: is your growth outpacing your burn?

Market/White Space › Market size / disruption› Competitors

LIGHTER CAPITAL © COPYRIGHT 2015

› $10,000 in AWS credits valid for 2 years › Free access to the AWS Essentials 1 day web-based or instructor-led

training (normally $600/course), plus 8 tokens for self-paced labs (normally $30/lab)

› One year of premium AWS Business Support (up to $5,000)

› Free access to 1:1 virtual office hours with AWS solutions architects

› Special offers from other companies that help startups, including Chef, Bitnami, Amazon Payments, SOASTA, Podio, CopperEgg, CloudCheckr & more.

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Access the AWS Activate Program with Lighter Capital

LIGHTER CAPITAL © COPYRIGHT 2015

Q&A

Visit Our Websitewww.lightercapital.com

Apply Onlinewww.lightercapital.com/apply

See If You Qualifywww.lightercapital.com/how-it-works/see-if-you-qualify

Learn More about Lighter Capital Download the Funding Options Whitepaper

bit.ly/1FBAtFs