Resource Night Recap: Financing Early-Stage Ventures

Each week you can read a recap of the previous session. This week, the Buerk Center for Entrepreneurship’s Amy Sallin recaps a class focused on financing early-stage ventures. If you have questions about the lecture series, or any of the Buerk Center’s student competitions, email Amy at [email protected].

Resource Nights topics have taken us from what it takes to be an entrepreneur, to finding your inspiration, to examining various market strategies. Last night’s session started us down the path of financing an early-stage venture. Instructor John Zagula, a savvy VC himself, framed the “physics of money” with three theories—the box, the pickle, and the pie. Check out the class video and slides for last night to learn more about pickles, pies and boxes and their relation to startup financials!

Christy Johnson, CEO of Artemis Connection, is a consult and a savvy investor herself. Christy is passionate about economics and gave a great big-picture view of what venture capitalists look for in an investment at a macro-economic level, then ran through an exercise in developing a financial picture with VC funding in mind. Following the macro view, Ethan Rudin, CFO for Napster, walked the students through the micro-economic view and talked about the actual day-to-expenses of running a startup.

Hearing about the potential for VC funding is always exciting and inspirational. However, the reality for very early-stage companies—particularly student teams—VC and angel investment is often several years down the road, if at all. And before a major investment, most angels and VCs prefer to see that both the founder and their families believe enough in the business to put in their own money first.

Most early ventures begin with an investment from the founders, plus friends and family—meaning personal loans from parents, grandparents, and anyone else you can convince to back you. And don’t forget that actual revenue is often the fastest way to finance your company! Christy talked a bit about bootstrapping her current endeavor, and a big plus for this method is that you retain ownership and control of your business.

Christy summarized her view on entrepreneurship with a few points that are key for early-stage teams:

• Entrepreneurship is a great opportunity to learn about business, the industry and yourself. It might not make you rich, but life satisfaction is amazing.
• Start something: prototype, test, validate your learnings
• Diversity yields higher returns. Focus on your corporate culture from the beginning—it gets created whether you focus on it or not.
• Play to your strength and build the smartest team around you. And be savvy about co-founder relationships—it’s as serious as getting married

NEXT LECTURE: JANUARY 16

The next topic is Setting Up for Success—managing time, people, structure. Guest speakers will be Steve Yentzer, manager partner at DLA Piper, and Jennie Ellis, founder of Recruiting Bandwidth. While legal and HR issues aren’t the most exciting part of entrepreneurship, it’s essential to understand these needs early. From filing the basic corporate paperwork to agreeing to terms with your co-founder to hiring your first employee, you need to know this foundational information. Knowing John, next week will be informative and fun!

Thursday, February 16, 6:00 pm in Paccar Hall, Shansby Auditorium (room 192)

OFFICE HOURS WITH EXPERTS—Don’t miss out!

Registration for appointments is open now via the MentorConnect website. Teams entering the Environmental Innovation Challenge and Business Plan Competition should take advantage of this time to get feedback from these mentors—book an appointment now! Office Hours appointments are only for student members of teams preparing to enter the EIC or BPC.

Thursday, February 16, 3:00-­5:00, Dempsey Hall 211, Herbold Innovation Lab.

John Plaza (Strategic Planning)

With more than 20 years of experience in the renewable energy, clean technology, and aviation sectors, John Plaza has a proven track record of launching highly successful startups from the ground up, obtaining funding from leading private equity and venture capital firms, successfully growing operations, and structuring mission-critical partnerships and alliances.

Josh Binder (CleanTech, Manufacturing, Engineering)

Experienced executive and business segment leader with a record of success leading organizations to develop, launch and support technical products. Experience includes general management, operations, and P&L roles. Recognized ability to crossbreed technologies from multiple fields to drive business success.

COMPETITIONS

Read why students call the competition experience “the best thing they did in college” on the Buerk Center blog.

DEADLINE TO SUBMIT TO ENVIRONMENTAL INNOVATION CHALLENGE February 20, Monday by Midnight
Team Registration

Upload your ­5–7 page Business Summary by 11:59 pm Monday, February 20. No late entries accepted. The top 21 teams will be notified by Wednesday, February 27 if they have been selected in the Screening Round and will go on to compete in the final round Challenge on March 30.

BPC PANEL: Insights from Past BPC Participants

Thursday, February 23, 5:00–6:00 pm in Bank America Executive Ed Building, room 320

Get a jump-start on your BPC planning with this interactive session featuring students who experienced the trials, tribulations and thrills of taking part in the Business Plan Competition. Don’t miss the opportunity to learn from these past BPC superstars!  Since this is the hour prior to class I’ll order pizza to power us through the evening, so please RSVP!

Taking part in this interactive panel are:

• Ryan Ahern, JikoPower (EIC 2015, BPC 2015, 2016, J+F Accelerator 2015)
• Carrie Ferrence, Stockbox Grocers (BPC 2011, J+F Accelerator 2011)
• Brian Mogen, MultiModal Health (BPC 2014, 2015, 2016, J+F Accelerator 2015)

AND MORE RESOURCES

• Use MentorConnect to contact experts in a variety of industries who can help you prepare.
• View past executive summaries online from EIC participants (Resources tab, scroll down to Other Resources); and BPC participants (scroll down to the Learn by Example section).
• Stop by the Buerk Center to look at a wide variety of executive summaries entered into the EIC and BPC.
• Review the Judging Criteria for the BPC Screening Round as you work on your 5–7 page executive summaries. Helpful hint: Use the Submission Checklist to help guide you through the judging criteria.
• Check out our Startup Resources webpage.
• If your team needs legal assistance consider applying to become a client at UW’s Entrepreneurial Law Clinic (ELC). The ELC is an innovative clinic that teams law and business students with pro bono attorneys and advisers to provide early stage legal and business counsel. Check out the ELC website for details, application and deadline.