Where Money Meets the Talent

Where Money Meets the Talent Jouko Ahvenainen / June 19, 2013 Singapore

Grow VC Group ++ www.growvc.com ++

@growvc ++ Innovating Investing ++

Copyrights © Grow VC Group 2013

Jouko Ahvenainen ++

•  Serial-entrepreneur and startup investments

•  For example, mobile, media, advertising and data analytics startups

•  Worked in Asia, Europe and the US

•  Columnist at Telecom Asia •  Grow VC Group Founder and

Chairman •  uk.linkedin.com/in/joukoahvenainen/

Grow VC Group ++

•  2009 Grow VC Company was created o  to build #1 global equity crowdfunding online platform under

www.growvc.com domain

•  2010 growvc.com service was launched o  pioneer in equity crowdfunding

•  2011 Company expanded o  team of 50+ people spread across the globe o  develop the business globally within the equity crowdfunding

market segment. o  online platform was developed extensively to meet global and

local startup ecosystem requirements and startup lifecycle thinking

Group History ++

•  2012 Grow VC to Grow VC Group o  Grow VC Networks model was launched as public BETA. o  along with the JOBS Act passing in the US adding clarity to

emerging market, a bigger strategy switch was done to add focus on all of the company activities

o  the company was restructured to Grow VC Group with several different business units, companies and operational teams

•  2013 Acting as Grow VC Group with independent units o  all units focus on executing their own business in their

specific business area o  Grow VC Group reputation and synergies between units are

utilized where relevant

Group History ++

Finance and Services Infrastructure Investment Portfolio

Entities ++

Grow VC Group Strategic partnerships and group

investment portfolio management

www.growvcgroup.com

Grow Advisors Consulting and investment bank type

services for crowdfunding ecosystem www.growadvisors.com

Mutual Seed Fund Crowdfunding co-investment fund,

works with many crowdfunding services www.mutualseedfund.com

Crowd Valley Turn key solution to start crowdfunding for any assets, equity or lending www.crowdvalley.com

growvc.com Startup ecosystem platform and leading global marketplace to invest money or work in early phase startups www.growvc.com

ChangeLab23 Design & build digital product, where customer experience is at the heart www.changelab23.com

Core Businesses 2013 ++

Other Business Vertical Startup Ecosystem Other Business Vertical

Funding Networks

Non Funding Networks

Platform Businesses ++

Full solution: investment community, tools, payments, backoffice and reporting – set up in a minute

3rd Parties can start crowd funding p2p investment market place on our platform ++

Mobile Monday & Grow VC Co-operation ++

Portfolio samples: Lost in Translations Inc. ++

•  Easy to use tool to make and maintain language versions of web services and mobile apps

•  Different services levels for translations, including crowd sourcing

•  Silicon Valley based company, with strong customer demand globally, including Asia

•  Enable any company to offer their services easily in any language

•  www.lostintranslations.com

Portfolio sample: Skimmler ++

•  Easy for any publisher to make its own Facebook or mobile reading application

•  User can follow several publications in one place

•  Much more is coming in the beta launch: tools to help reading, find relevant content and follow publications around the world

•  www.skimmler.com

Startup funding ++

1.  Since 2008 it has been especially difficult to raise money to VC funds 2.  Traditional VC funds starts with approximately USD 2M investments 3.  Basically all countries look for new growth and see that traditional industry is not

enough 4.  When VC’s have had issues to raise more money, it also cause issues to fund

companies that are already in their portfolio 5.  Capital efficiency has increased, i.e. startups can start with smaller capital 6.  Many governments and local organizations invest to build better startup ecosystems

locally and also want to participate in funding or attract investors to operate locally

7.  Crowd funding and ‘open market places’ are emerging 8.  There are also more local business angel networks, and e.g. governments have

created some tax schemas to attract more people to invest in startups 9.  There are several new models to get money, like crowd funding, angels, local

support, and incubator programs. But issue is also, how to get these to work together

10. Many startups focus very much towards the US, when it has offered the best funding and exit market. At the same time emerging markets could offer e.g. easier routes to make revenue and organic growth.

10 Points about startup funding ++

New finance regulation ++

§  The team has invested three years into the crowdfunding industry globally, and positioned itself in the ecosystem globally "

§  The team has been part of the US Delegation in Transatlantic Economic Forum, had cooperation with Singapore Government Investment Company, "

§  UK Trade and Investment, and is a founding member of Crowdfunding Regulatory Intermediary Association (CFIRA), Crowdfunding Professional Association (CFPA), National Crowdfunding Association (NLCFA), European Crowdfunding Network, cooperation with Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA) "

§  We have a jumpstart on any direct competition with 400+ existing business customers, ranging from small communities to large networks of communities like the World Bank "

We build this market ++

Peer-to-peer Less fat middle-men

global transparent

open collaborative

efficient scalable

Read & write, participatory, conversational: markets are conversations, marketing is a conversation, business is a social science!

A new language:

Co-creation + networked economics + communities of interest can be and are, proven & powerful platforms and processes to stimulate innovation and commerce

Startup funding ++

•  It is to get different funding models to work together o  Transparent models, fair agreements and opportunties o  ‘Market value’ o  Continuity for the next funding rounds

•  Different Investors offer different kind of value added o  Better to make difference between money investment and

competence each investor or other member brings

•  There can be several co-investment models, passive or active

•  It is typically important to build co-operation with business angels, VC’s and incubators

Different funding models and Ecosystem ++

Companies make sourcing and get investments all the time: the question is how to get crowd involved to this and develop models to make the sourcing and investing market more effective

Nothing new but totally new ++

Crowd funding 1

Market Place

P2P Lending

Companies / Assets Market Places Investors / resources

Co-investment and co-lending ++

1. Funding round or loan application

•  A company opens a funding round or apply a loan

2. Crowd funding or

p2p lending

•  Crowd, i.e. ordinary people, can offer an investment or loan, and if enough money available, the company gets money

3. Co-investment or

co-lending

• A bank or investment company can join to a deal, i.e. make co-investment or participate the loan

Group Level Synergies ++

1. Direct investments o  An investor invest directly in a company, become a shareholder,

company can have hundreds of small shareholders 2.  Investments through an instrument

o  An investor can select a company he/she invest in, but the actual investment is done by an investment company that aggregate all investments together, the investment company is the shareholder

3. Crowd funding of investment instruments o  Crowd funding model is used to raise capital in a fund and the fund

makes investments 4. Co-investment models

o  Different models to make co-investments with crowdfunding

Investment models and crowd funding ++

•  Co-investors can be e.g. business angels, VC’s, or funds

1. Co-investment partners a.  Partners follow p2p, typically no automated investments, but use

crowd to filter investment opportunities b.  Leading investors offers cases to crowd, and crowd follow them

2. Syndicate models o  Can have two models as above, but formalized co-investment

models with pre-defined models, shares and responsibilities

3. Built-in investment instruments o  Investment instruments that are built to work with the p2p

investments, e.g. automated co-investment o  The instruments can be like traditional funds or modified versions

Grow VC co-investment models ++

•  Grow VC is building a special co-investment instruments •  The instrument and concept is built especially for the p2p co-

invesments

•  The instruments are built to work with p2p models, crowd can filter cases, or p2p bring leverage to fund investments

•  Investors can join the instrument online, by defining their investment criteria like total sum and the number of companies (diversification)

•  The instrument is launched in six months

Mutual Seed Fund ++

•  It is important to think the whole startup and funding ecosystem and all its components

•  Peer-to-peer is here to stay, equity crowd funding is just starting to grow

•  P2P is not to replace all other models or solution for needs

•  It is crucial to build an ecosystem where different investment models work better together, including p2p – new solutions are needed

•  P2P is not only for startup funding, it will have influence on the whole finance sector to make it more effective

Future ++

“You don’t have to be Steve Jobs, to be an entrepreneur”

”You don’t have to be

Bill Gates to be an investor”

”Everyone must start somewhere”

Jouko Ahvenainen jouko@growvc.com

+44 7889 833 165 (UK) +1 646 363 6664 (US) +852 8120 7854 (HK)

Grow VC Group ++

www.growvc.com ++ @growvc ++

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