Session 3: Financing Sources Panel; Financial Projections
Thursday, January 23, 2014
6:00pm to 9:00pm, Room: 10-250

Part 1: Financing Sources Panel
You have identified the product/service and the market. You have settled on a business model and have done your financial projections. How will you finance the plan?

This session will cover: Bootstrapping the early stages. Funding from the 3 F's- Friends, Family and Fools. Angels- who are they and what are they looking for? Private placements. Customer financing. Consulting- getting someone else to pay for the development, provide a beta site and endorse your idea. Venture capital. Bank financing.

You will learn about the institutional constraints and needs of various funding sources. As a result you will be in a better position to determine if, when and how to approach these sources for financing.

This part of the program will feature a panel of experts representing different financing sources.

Speakers:

• Axel Bichara, General Partner and Co-Founder, Bolt.io (seed stage/accelerator)
• Amir Nashat, Polaris Partners
• Julianne Zimmerman, Co-Founder and Managing Director, Vodia Ventures (early stage)

Reading:

• "A Beginner's Guide to Venture Capital"  How is a Venture Capital Fund structured?  How are VCs compensated?  What does this mean for you?.
• Venture Capital Deal Terms  MIT Enterprise Forum presentation.
• "Thinking About Valuation"
• "Dilution – Here Is A Primer of Stock Vocabulary"
• "All Financing Sources Are Not Equal"
• "What Are the Terms? - Part 1: A Preferred Return"
• "What Are the Terms?- Part 2: Investors Need Some Control After Their Checks Are Cashed"
• "What Are the Terms?- Part 3: Run Don’t Walk To The Exit"
• Excerpts from: Venture Support Systems Project: Report on Angel Investors, MIT Entrepreneurship Center, 2000.
  The full report is also available: Full Angel Investor Report.

Part 2: Financial Projections
Armed with an understanding of the market for your products how do you figure out what financial resources you will need to bring a product to that market? This portion of the program will introduce some financial projection techniques based on actual business experience.

Readings:

• Chapter 10, "Figuring Out Financials" and Chapter 11, "Forecasting and Budgeting" from Tiffany, Paul and Peterson, Steven, Business Plans for Dummies, IDG Books Worldwide, Inc. 1997.
• Review the financial projections in the Virtual Ink plan.
  • Manufacturing and Operations Section of Virtual Ink Plan
  • Financial Statement in Body of Virtual Ink Plan
  • Detailed Financial Statements in Appendices of Virtual Ink Plan
• Download a copy of the Financial Template to be shown in the lecture.

Speaker:
Charlie Tillett
Sloan MBA; Former MIT 10K Participant; Serial Entrepreneur
Read his bio here.

Presentation Slides:

Business Plan Financial Projections