What's a good startup ? - Founder and Investor Point of View
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What's a Good Startup ?
Tips from Jeremie Berrebi, Angel investor in 300+ companies and Founder/Cofounder of 11 companies
2. About JeremieBorn in Paris, Jeremie Berrebi is one ofthe most famous French entrepreneurs inthe high tech industry who began hiscarrier as a journalist for ZDNet andfounded, or cofounded, 11 companies todate.Since 2010, Jeremie is considered themost active angel investor in the world.Having invested directly, or indirectlyvia Kima Ventures, in more than 300companies in 25 countries.He’s still investing 1 to 3 companies aweek all over the world.Jeremie was voted the ‘Best Seed/Angel Investor’ in Europe in 2014 atThe Europas.Jeremie has already sold companiesto Google, OpenTable, LinkedIn,OutBrain, Jive Software, Incomm,ShareThis, Naspers, Fotolia, TNS etc…Jeremie Berrebi is living in Bnei Brak,the main Jewish Orthodox city inIsrael and part of the CharediCommunity. 3. Having a real andbig vision/story 4. Be passionate about a VERYLONG (5 to 10 years) journeymore than the moneyFORGET ABOUT EXITS! 5. Find an idea related to apassion you love andthat helps a lot of people 6. Answer a very big needthat you have yourself! 7. “I find out what the world needs,then I proceed to invent.”Thomas Edison 8. Think and talk aboutbenefits for yourcustomers, not features 9. Execution is KeyIdea => 5% 10. Make an AwesomeProduct 11. Think about a potentialBusiness Model (AcquisitionCost<Potential Revenues) withpotential for very big and fastgrowth 12. Build the right team• Find the right cofounders you already know well• Define exactly what’s the role of each one.• Write a Cofounder agreement.• Begin with a test period• Build a Killer, Experienced and Passionate Teamwho shares your vision. (Don’t hire robots) 13. Create Barriers to Entry 14. Ready? 15. Multiple types of startups• If you’re launching an app or software• If you’re building a new complicated technology• If you’re building a hardware company/IoT 16. If you’re launching anapp or software 17. Bootstrap as muchas you can• No paid office to begin• Be a coder yourself! and use Freelancers for difficult tasks(Odesk)Avoid employing people!• Build a Minimum Viable Product (MVP) => Remove as manyfeatures as possible• All productivity tools are now free (Google Docs, Skype)… Youjust need a computer!• Most of big companies have a Startup Program (SVB, ZenDesk,Amazon, Google, RackSpace etc…) 18. It’s taking a lot of time tofind the real product fit• Don’t raise money too early• Iterate, iterate and iterate• Measure and write down your 3 KPIs (includingRETENTION) every DAY! 19. But what if I’m reallyworking on building anew technology? 20. New Tech Financing• Build an awesome cofounding team+top AdvisoryBoard• Find potential awesome employees ready to jump• Try to build and show an awesome prototype• Show your experience and expertise in the currentfield• Raise enough money to launch your product in themarket. 21. What about a hardware/IoT company? 22. Hardware company• Build a team who have already built hardware• Develop a prototype• Find potential customers/channels ready to pre-order• Launch your product on Kickstarter and Indiegogo• Raise at least $1M after your successfulcampaign. Hardware is hard & expensive 23. Raising Money 24. When do I need to raisemoney?• When you’ve found that you’re answering a realneed with a real product (and resolve retentionproblems)• When you want to push the accelerator in ONEdirection• When you need more people to serve yourcustomers. 25. When do I need to NOTraise money?• When you’re still iterating, iterating, iterating…• When you still don’t know what your companywill look like in 1 year• When you have no very satisfied customers…• When you need to raise only because you needa salary 26. What is an investor checkingbefore investing in a company?• How nice is your deck? How big and clear is your vision?• Are you answering to a real need? => Are potential customers and users waiting foryou?• Do you know how to promote/sell the product? (Potential chicken and eggproblems) How much money do you need?• How innovative is the technology?• What’s the entry barrier?• Did I find the right and best team to make this company big?• How many months of runway will the company have with the current investment?What will be their status after all these months?• How do you plan to use the money raised? (big salaries, great sofas, big office,hiring an expensive sales guy, lots of travel…) 27. Don’t lie to your investorsbefore or after a round!NEVER! 28. Consider your investors’money as yours 29. Update your investors with 3 to 5lines every weekThey will be your best ambassadors 30. Good luck!– Jeremie Berrebi (@jberrebi)www.berrebi.orgThanks to Michel Sassano & Vincent Jacobs for their comments
- 1. What’s a goodstartup?Investor and Founder point of viewJeremie Berrebi (@jberrebi)November 2014www.berrebi.org