Cliff_Lardin_AEM_437_Presentation

Cliff_Lardin_AEM_437_Presentation - Cliff Lardin...

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Cliff Lardin Entrepreneur In Residence AEM 437 Talk February 26th, 2008
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2 About Cliff Entrepreneur in Residence A position within the Johnson School Active involvement with dynamic company/idea teams Revolving one-year post ending June 2008 Available to anyone in the Cornell Community Principal at Cayuga Venture Fund Founder of CYAN Data Systems; Minigram.com; Bright Island, LLC Senior Engineer, Varian Semiconductor (Nasdaq:VSEA); IT Director, Flowers Foods (NYSE:FLO) Cornell MBA ’07, BA ’06 Amherst College ’93-’95, Independently educated prior to Amherst
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3 Agenda Overview of Funding Sources Angels Grants Loans Venture Capital Boot-Strapping
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4 Debt vs Equity Debt is considered “less expensive” Hard for startups to get debt Most startups must sell equity for $ The result: over time, founders own less and less of the startup A fact of life for high-growth companies
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5 Different Options for Different Companies Is the business high-growth? Leveraging technology that requires further development? .for a while… What about bank loans? Not without cashflows… Not all business fit the “VC model” (e.g., restaurants)
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6 Agenda Overview of Funding Sources Angels Grants Loans Venture Capital Bootstrapping
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7 What is Bootstrapping? Got a credit card? Cashflows had better be near-term! Service business and consultancies can go this route
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8 Bootstrapping – a good idea? Can severely limit growth when compared to equity financing Most people will say “no” (almost) ALL VCs will say “no” A reasonable first step for a VC-backable startup Seldom successful for high-growth companies
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9 Agenda Overview of Funding Sources Angels Grants Venture Capital Boot-Strapping
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10 Bank Loans Not for startups (except for SBA candidates) Think “line of credit” from Wachovia Real business, 100 employees, $30M in revenue PPE for collateral
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11 SBA Loans Small Business Association ( www.sba.gov ) Offered through normal banks, guaranteed by SBA Amounts up to $2M (normally max is $1M) SBA has no money, just guarantees Banks want to see BOTH cashflows and collateral
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This note was uploaded on 02/19/2009 for the course AEM 4370 taught by Professor Leiponen,a. during the Spring '08 term at Cornell.

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Cliff_Lardin_AEM_437_Presentation - Cliff Lardin...

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