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Issues of a startup

Amit Shah

Experienced Investors and Entrepreneurs

U.S. Investment Team Amit Shah Yatin Mundkur Saurabh Srivastava Tom Dennedy Dr. Ajit Singh Dr. Akhil Saklecha

Venture Investing Experience Collectively invested $450+M in 100+ companies - seed and early-stage 74 exits with aggregate realized return of 4.2x 9 IPOs and 33 acquisitions Entrepreneurial Experience Co-founded 4 startups in the U.S. and India 4 successful exits with aggregate value of $610 million ZeitNet, PipeLinks, Equator, Daksh, Ross, Kaleida Backed by: Sequoia, Greylock, General Atlantic, Actis, Sony, Canon, Hitachi Operating Experience - public and private Cisco, Rockwell, AMD, DEC, Silicon Graphics, Cabletron, Compaq, Qualcomm, HP, Tata Motors Technology Background Played pioneering roles in seminal industries: Server Computing, Networking, Voice over IP, Video on Demand, IPTV, Digital Consumer Electronics 15 US patents

India Team
M. J. Aravind Ramesh Radhakrishnan Kumar Subramanyam EIRs Piyush Patel Phil Ferolito

Why? O Why a startup?

The trigger for doing a startup My boss sucks; I dont like my job; He/she made it; why cant I?

Always wanted to do a startup

Caution: Not sexy; most likely foolhardy Very, very hard work with incredible ups/downs Enjoyment is in hindsight

The actual Idea - Hammer in search of a nail - Intersection of experience, market understanding, ability to execute Is it a business? Feature Product Company

What is a Business Plan?

Not an excel spreadsheet or a word document or a PowerPoint presentation An innate and clear understanding of what you are going after Remember: if it is in the press it is too late Truly understand the market dynamics

The money

Most businesses should not raise venture money Do you really know why and how much money you need? Who do you raise it from? - Customers, partners, friends and family, angels, VCs - Government (Darpa, SBIC,)

The VCs
They are evil; dumb; do not understand my business; trying to screw me;
- All true - No different than a marriage
How well do you know the person?

- Look beyond the sexy early days and to the fat middle age and can you live with it? - Ecosystem

Secrets of a firm
What do they like? (These days) do they have the money? Which partner? Have they already done too many deals for the year? Is it their sweet spot? Can you finance future rounds with them?

Actually doing a startup Phases
Primordial Middle Ages Industrial Revolution Deliverance

Concept Early fools Extreme Energy Some lucidity

Middle Ages
Newer Skeptics & converts Energy / focus correlation Outside thoughts Confusion

Industrial Revolution
Scale Technology ready for customers Sales and Marketing starts ramping Internal Challenges
Job function confusion (mix of newer v/s older employees) Communications
Hallway conversations dont work Processes (unfortunately) needed

People dissatisfaction Inability to scale Some dont make it thru transition

Customer interaction starts
Initially Skepticism Goes to piddly stuff Some more selling and it becomes maybe If persistence, the customer converts

Personal goals (fill in)

Value Creation in terms of dollars and time Global/National/Niche company Create a paradigm shift? Companys DNA will reflect this vision