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Venture capital Andrew farquharson

Venture capital Andrew farquharson. What Is Venture Capital?. Actively investing money in young companies to catalyze their growth Examples of VC-backed ventures:. 2. Entrepreneurship: Hallucination or Vision?.

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Venture capital Andrew farquharson

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  1. Venture capitalAndrew farquharson

  2. What Is Venture Capital? • Actively investing money in young companies to catalyze their growth • Examples of VC-backed ventures: 2

  3. Entrepreneurship: Hallucination or Vision? • If you can’t convince others to share your vision and to start allocating resources toward it, you’re wasting your time. • Probably. 3

  4. People Matter • No one builds a company alone • Innovation comes from the collision of ideas • It’s hard to win in business. A team of A players will be about 10X as productive as a team of B players • Top performers have fun together • Marketing and engineering need to integrate 4

  5. Not every company needs Venture Capital • Operon: sold for $150M • Made-to-order custom DNA synthesis • No VC Funding – raised $200K from angels 5

  6. What VCs Look For 6 • Opportunities that offer large returns • Markets that are larger than $500M • Credible founders • Obvious commitment to the venture • Competitive advantages • Exit horizon makes sense • Right corporate structure • No surprises in diligence • Good chemistry with entrepreneurs

  7. Founders and VCs • Entrepreneurs • Mindset: see no problems – only opportunities • Unrealistic value expectations • Short-term view of financing • Do not prioritize investor returns • Want to maintain control • View the business personally • Investors • Mindset: focused on IRR and multiples of capital • View management, clinical & financing as major risks • Considers ownership important for all parties • Control by outside board • Want early exits 7

  8. Top Fundraising Mistakes By Founders Valuation expectations No skin in the game Wrong team/advisors Defensive, poor listeners Overhype Claim no competition Paranoid about confidentiality Fall in love with technology See a milestone “just around the corner” Sell the product, not the investment Entrepreneur’s rose-colored glasses Spectacles worn by a serial investor 8

  9. Why Did I Enter Venture Capital? 9

  10. Today, billions suffer one or more chronic diseases

  11. Pharmacologic Therapy for Epilepsy • Treats underlying pathology without sedation • Senses and prevents seizure progression • Delivers drug over 5 years • Current drug market: $16B/year Market 3M patients suffer from Epilepsy in the US Assuming $30,000/device and 100,000 patients/year: US market is about $2B Similar market sizes exist outside of the US 11

  12. Thank you Andrew Farquharson

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