Finance for Startups, kick-off (Feb 7th 2012)

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Slides of kick-off Finance for Startups

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  • 1. Finance for StartupsMartin van Wunnik Xavier Corman07/02/2012Xavier Corman | Martin van Wunnik 1

2. Sponsors07/02/2012 Xavier Corman | Martin van Wunnik 2 3. Finance for Startups Introduction Company Setup Accounting Financial Plan Funding your startup Valuation / Dilution Workshops details Q&A Pizza07/02/2012Xavier Corman | Martin van Wunnik 3 4. Who we are ? Martin van Wunnik Xavier Corman07/02/2012 Xavier Corman | Martin van Wunnik 4 5. This presentation is available for free: http://www.meetup.com/Finance-for-Startupshttp://www.slideshare.net/xaviercorman07/02/2012 Xavier Corman | Martin van Wunnik 5 6. Creativity levelFinance & Accountinglevel07/02/2012Xavier Corman | Martin van Wunnik 6 7. Creativity level Reality checkFundingValue ? Investments, Costs, Revenues, Cash Financial Plan & Elevator pitch Organization/Company Finance & AccountingTeam/Partners level07/02/2012Xavier Corman | Martin van Wunnik7 7 8. Creativity level1.000 EUR 21% VAT (quarterly or monthly refund request/compensation) InvestmentsCash out: 1.210 EUR Cash in: 210 EUR (>3m)Profit impact: 200 EUR over 5yCostCash out: 1.210 EUR Cash in: 210 EUR (>3m) Profit impact: 1.000 EUR Discounted Cash Flows Finance & Accounting level07/02/2012Xavier Corman | Martin van Wunnik8 9. Why Finance for Startups ? If you dont think about the future,you cannot have one. John Golsworthy where you want to goYou need to know how you are supposed to go07/02/2012Xavier Corman | Martin van Wunnik 9 10. CASH 07/02/2012 Xavier Corman | Martin van Wunnik 10 11. Company Setup Why should I ? Capital Hats/Personalities07/02/2012 Xavier Corman | Martin van Wunnik 11 11 12. Why should I ?Limit your liabilities ! Professional touchFiscal 34% (24% for 3y)Succession ... Formalities & some costs (bank, notary, KBO/CBE, social secretary)Double entry accounting Revisor for in-natura contributions07/02/2012Xavier Corman | Martin van Wunnik 12 12 13. Minimum capital Legal BVBA-SPRL (min.1)CVBA-SCRL (flexible)18.550 EUR6.200 EUR (or 12.400 EUR) SA-NV (min.2):61.500 EUR REAL minimum = Business required !07/02/2012Xavier Corman | Martin van Wunnik 13 13 14. Shareholders Control (>51%)Absolute / Relative majority 40% - 60% 40% - 10% - 10% -10% -10% -10% -10%Voting Rights Class A & B Minority (blocking) interest Investors per phase (dilution)! Stock options:fiscal implications, buyer requiredvesting conditions : targets, period (4y)07/02/2012 Xavier Corman | Martin van Wunnik1414 15. Hats/Personalities Founders: 3 years responsibility07/02/2012 Xavier Corman | Martin van Wunnik1515 16. Accounting: notions Balance Sheet Bilan Balans Profit & Loss Compte de rsultat Winst-en Verliesrekening Cash-flow Trsorerie Schatkist Financial Plan Plan financier Financieel Plan07/02/2012 Xavier Corman | Martin van Wunnik 16 17. Accounting: Balance SheetACTIVE PASSIVEEquity(Capital/Kapitaal) Non Current Assets (Actifs Immobiliss/ Vast Activa)LT DebtsCurrent Assets(Actifs circulants/ Vlottend Activa) ST Debts07/02/2012 Xavier Corman | Martin van Wunnik 17 18. Accounting: Profit & Loss (P&L) COGS (Cost of Sales)Personnel CostsGeneral Expenditures Revenues (Sales)DepreciationFinancial cost Profit07/02/2012 Xavier Corman | Martin van Wunnik18 19. Financial PlanContent Assumptions Profit & Loss Balance Sheet / Investment Cash-Flow -> Cash needed Valuation of the project Profitability / return of the project07/02/2012Xavier Corman | Martin van Wunnik 19 20. Financial Plan in 10 min Dont waste your time in developing a hugefinancial plan before to be sure that yourproject is viable ! In many case, in less than 10 minutes, you cansee if your idea worst something. How to make a very quick financial plan ?07/02/2012Xavier Corman | Martin van Wunnik 20 21. Financial Plan in 10 min /questionsWhat are your revenues ?What are your costs ?What are your investments ? How many persons for your project ?07/02/2012Xavier Corman | Martin van Wunnik 21 22. Financial Plan / Prerequisites & Assumptions Financial plan for 3 to 5 years Monthly or Quarterly base Excel or Calc is your friend Start by listing your main assumptions07/02/2012 Xavier Corman | Martin van Wunnik 22 23. Financial Plan / Tips for assumptions Office: 25 m/person Price of offices: EUR 100/m/year + 15 % formaintenance Insurances: 1 % of revenues Marketing: define a % of revenues + startinginvestment Dont forget lawyers, accountant, socialsecretary, office supplies07/02/2012 Xavier Corman | Martin van Wunnik 23 24. Financial Plan / Profit & LossRevenues (Sales)COGS (Cost of Sales) General Expenditures COSTS Personnel CostsFinancial cost DepreciationCASH CASH-FLOW IF NEGATIVE DRAINProfit07/02/2012Xavier Corman | Martin van Wunnik24 25. Financial Plan / InvestmentsList all your scheduled investments YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 507/02/2012Xavier Corman | Martin van Wunnik 25 26. Required Cash-Flow07/02/2012 Xavier Corman | Martin van Wunnik 26 27. Funding Some remarks Principles Options07/02/2012Xavier Corman | Martin van Wunnik 27 27 28. Funding, FinancingAnd entrepreneurs? They seem to have confused the definition ofentrepreneurship altogether.Entrepreneurship, they mistakenly believe, equals financing!This is wrong.Over 99% of entrepreneurs who seek funding get rejected.Yet, the entire world is focused on the 1% that is "fundable."http://www.readwriteweb.com/start/2012/01/the-other-99-of-entrepreneurs.php07/02/2012Xavier Corman | Martin van Wunnik 28 28 29. http://www.ideaowl.com/blog/2011/06/microconf-2011-3-surprises-and-learnings-from-best-conference-ever/07/02/2012 Xavier Corman | Martin van Wunnik 29 30. Interest Returns 100102 Bank 1000..1000 Stock market100100 F.F.F.100107 Bank100130 BA / VC07/02/2012Xavier Corman | Martin van Wunnik 30 30 31. 100+7=107 Bank Principal & InterestAble to pay back over timeGuarantees07/02/2012Xavier Corman | Martin van Wunnik 31 31 32. How to finance your start-up ?07/02/2012 Xavier Corman | Martin van Wunnik 32 33. 07/02/2012 Xavier Corman | Martin van Wunnik 33 33 34. Valuation The value of any business is the present valueof the future income stream You sell future virtual profits for present realmoney07/02/2012Xavier Corman | Martin van Wunnik 34 35. Valuation Exit Money s ue iqhn Tecuph- tc CaSweat Money Year 1 Year 2 Year 3Year 4Year 5 Year 607/02/2012 Xavier Corman | Martin van Wunnik 35 36. Valuation - What is dilution ?07/02/2012Xavier Corman | Martin van Wunnik 36 37. Next Workshops Venues still to be defined (Brussels)07/02/2012Xavier Corman | Martin van Wunnik 37 38. There is no free-lunch* Each workshop = 90 EUR vat incl. WeStartup members: 50 EUR (VAT incl.) MAX 10pers/workshop 2 hours + Slides + Foods & Drinks* Milton Friedman07/02/2012Xavier Corman | Martin van Wunnik 38 39. Questions & Answers Free download: http://www.slideshare.net/xavierCormanhttp://www.meetup.com/Finance-for-Startups/messages/boards/07/02/2012Xavier Corman | Martin van Wunnik39

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