 It's my pleasure to welcome you to this Tech Connect, a webcast on entrepreneurship and innovation topics. Tech Connect is part of the Department of State's Global Innovation through Science and Technology, or GIST initiative. My name is Andrew O'Brien, and I am the Special Representative for Global Partnerships at the U.S. Department of State. The Secretary's Global Partnership Initiative is the entry point for collaboration among the U.S. Department of State, the public and private sectors, and civil society. We work to strengthen and deepen U.S. diplomacy and development around the world through partnerships that leverage the creativity, innovation, and core business resources of partners for greater impact. The State Department values global partnerships and programs like GIST because, as President Obama has said, we believe that entrepreneurs can create jobs that fortify relationships between countries, build global markets, and help fulfill the dreams of all who desire the freedom to make of their lives what they will. The GIST initiative is based on a simple idea. When young innovators have the skills and mentoring they need, they are more likely to take the risks that can turn their ideas into startups and ultimately successful businesses. Through a range of competitions, boot camps, and programs like this TechConnect, GIST provides skills development, networking opportunities, and financial advice. The GIST network extends through Asia, the Middle East, and Africa, and includes over 180,000 entrepreneurs. GIST works with U.S. and local experts to ensure that participants have the support that they need to help take their ideas and innovations to the marketplace. GIST celebrates those innovators and entrepreneurs who, even though they may fail, are willing to take a risk to make their dreams a reality. I'm excited to note that GIST, global partnerships initiatives, and other U.S. supported programs like these, will join with entrepreneurs from around the world at the 4th Global Entrepreneurship Summit in Kuala Lumpur, Malaysia in October. Events like the summit help channel the creativity, innovation, and potential of millions of individuals around the world to create economic opportunity for all. We hope that you will watch and participate in global entrepreneurship summit events either in person or virtually. I want to thank the GIST team here at State and at CRDF Global for their hard work in putting together this event. Most importantly, I want to thank our TechConnect panel of experts for joining us today to share their experiences and answer your questions. And now, I'm pleased to introduce Ovi Bajoran from CRDF Global, who is today's moderator. Thank you, Special Representative Ovi Bajoran. We're very excited to welcome our viewers today to today's Global Innovation of Science and Technology, also known as GIST TechConnect. Global conversation about raising capital for your venture. We have an incredibly knowledgeable and dynamic panel with us that includes four very successful entrepreneurs to help answer some of your burning questions about how to go about raising capital. Today's session of the GIST TechConnect will further the dialogue between the panelists and entrepreneurs, mentors and investors in the US, Middle East, Africa, Asia, Turkey, and Latin America to exchange experiences, perspectives, and trends in creating and advancing science and technology companies. We're very excited to continue the conversations we started with our previous three TechConnect sessions and Shari attended the prior run on bootstrapping capital, which have energized thousands of entrepreneurs in the GIST community around the world. I'm Ovi Bajoran and I'm the lead for the GIST initiative at CRDF Global. We are very proud to partner with the State Department in this initiative to empower youth around the world, to empower their science and technology ideas and transform them into viable ventures that catalyze economic growth. CRDF Global has been proudly supporting and working with technology entrepreneurs in more than 40 countries for the last 15 years. Today, GIST, our program is thrilled to host another virtual connex web chat that connects entrepreneurs, investors, and innovators across geographies by using technology. We have a number of thousands of viewers around the world in 15 viewing sites and this level of outreach has been possible because of the partnership between a number of key player organizations like the State Department CRDF Global but also our local partners in the countries that we work with. We would like to invite you to use the hashtag at GIST TechConnect when talking about the event today so that you share any of the lessons throughout the program with the network of entrepreneurs in your network and we are very interested to hear your thoughts and collecting your questions that you can ask your panelists but please feel free to start sending those questions now and throughout the program we'll organize them and ask them to our esteemed panelists. I'd also like to request that you take out some paper and a pencil and pen to jot down some of the notes because you never know what type of idea you may get from our speakers and from the conversation that may be very valuable for your own venture and you don't want to lose those insights or ideas. This recording will be available to watch again at any time after September 25 and will also produce a visual summary of all the content of the conversation that we'll be sharing with our online community. Today's session raising capital for your venture, how to advance your venture capital through raising capital and the different avenues and traditional methods like raising through crowdfunding, angel investing venture capital and to using any other means that will allow you to advance your venture. To jump start the conversation we are very fortunate to have some thoughts of Sir Ronald Cohen who is the father of British venture capital and also Fadi Ghandur, a board member of Oasis 500 and the founder of Aramex that is the first Arab company that got listed on Nasdaq. Let's see what they have to say about raising capital and building companies. The point that you raise is a very interesting one, whether a crowdfunding platform can connect a group of people who are spread out throughout the world with opportunities in a country that has particular significance for them and I think the answer is yes providing the results. I think it's something to be trying and I think it may end up having success. The difficulty is to deliver financial results and so I would favor crowdfunding platforms where there is an experienced leader of the round of finance rather than one where you connect a business with a sole investor with no presence on the ground and so on and so forth because the results are obviously difficult to achieve and somebody who is leading around in a company and is managing a venture fund for example has the experience and the quality and size of team to be able to deliver results. As always, not only tech startups any startup needs, a founder needs to find a good team they need to show me a team. You can't claim that you are going to be the only founder. It's good that you do that unless you are the absolutely brilliant, brilliant, brilliant man and have an idea that is out of this world and you have discovered, I don't know, some incredible thing, you are not going to be able to build your business alone and even if you are I don't know, Einstein, you're not going to be able to do it by yourself. You'd better show how you're going to scale into new markets international markets. You'd better understand the complexity of expanding beyond your markets because outside of Europe and the US every startup is going to cannot have one market as its final destination. You need to show me traction. You need to show me that there is a client that believes in you that buys your product and thinks it's good and is going to come back and buy again and that's what builds the reputation. A client that comes back and again and again is what a reputation is all about. It is trust. You need to show me that. Wonderful insights from Sir Ronald Cohen and also from Fadi Ghandur. We see two different points and to build on one of them Crowdfunding is an exciting new way to raise capital for entrepreneurs both in US and international. Recently I was able to interview Slava Rubin who is the CEO and founder of Indiegogo. He was disappointed he couldn't join us today but I'm able to share with you some of the thoughts on raising capital by using Indiegogo that I found very interesting. Indiegogo has analyzed 150,000 campaigns that have occurred on their platform and have noted three aspects that matter. Number one is having a good pitch. Number two is being proactive and number three is finding an audience that cares. For example having a video alongside your pitch increases your contributions you get by 115%. For being proactive having a strong start-up outreach for example obtaining 25% of your funding within the first week makes you five times more likely to hit your mark, your target for the fundraising. The last point was finding an audience that cares which means moving from your current network to strangers in a way that makes you discoverable on the crowdfunding platform. Rubin calls this the proprietary algorithm or the go-go factor. When optimized, this factor helps you amplify out from your current network to others. It's just like a few insights from the experience of Indiegogo and actually we have one of the just-entrepreneurs, Hind Hobeka from Instabit and Brad met Hind at CS this year where she was listed as the seventh best device by Huffington Post at CS and she raised 75K using the crowdfunding platform. So it would be interesting to go through this as a mechanism throughout the program. Let's continue the conversation by seeing what our panelists today have to say in response to these thoughts. I'd like to first introduce Brad Feld who is joining us virtually through Skype today. Brad is the Foundry Group's Managing Director. He has been an investor and entrepreneur for over 20 years and prior to founding a Foundry Group, he co-founded Mobius Venture Capital and Intensity Venture, a company that helped launch and operate software companies and later became a venture affiliate of the predecessor of Mobius Venture Capital. With us in the studio, we have also an advisory board member at AXION USA and a seasoned entrepreneur in the US and emerging markets including Russia and Latin America. Shari has been at MIT Sloan School of Management for 10 years teaching about US venture capital investment and emerging market entrepreneurship. She actually teaches the raising early stage capital at MIT Sloan to the MBA students and I took the class a while ago. I have to disclaim this. Additionally we have with us Human Ratfar who is the founder of Chairman of ADDIS, the world's largest social infrastructure and data platform reaching 1.3 billion unique users monthly. Human is also an investor and entrepreneur with demonstrated experience in product development strategy operations financing and mergers and acquisition. Human was one of the I-Media's 25 most influential online marketing professional and we have with us Amir Alexander Hayson who is an entrepreneur in residence at MIT Entrepreneurship Center and accomplished entrepreneur with extensive experience in business development strategy, finance management, mobile application telecom and distribution. He has started three companies raised over 5 million from a different group of venture investors and build network that impacting the lives of millions of people in US, Asia, Africa and Latin America. As you see we have a very diverse and extensive set of experiences between our panel and I think this would be very beneficial for our entrepreneurs in the audience. To get us started I want to ask each one of our panelists to explain to our viewers how they think of the thoughts they just heard from Sir Ronal Co and Fadi Ghandur and their own thoughts on the ways to raise capital. Brad you are very successful so Brad let's start with your reflections on the thoughts of Sir Ronal Co and also Fadi Ghandur. I think that the thoughts were great but a mistake a lot of entrepreneurs make is that they believe that there's a single way to raise money or a single set of things that investors whether they be angel investors or venture capital investors are looking for. I think it's critically important that entrepreneurs recognize that there are lots of different types of investors and there are lots of different things that appeal to those investors and as part of the process it depends a lot on the stage of your company what you're going after, the market you're going after, the way your company is configured, where it's located understanding yourself first and then targeting specific investors that are going to have a higher affinity for your company is critically important versus applying a generic lens to any company in any fundraising. Great, great to hear this. Thanks Brad let's go to Shari now, reflections on some of the insights that we heard from the speakers. First of all I want to say thank you very much for having us here today this is a very important topic I know and I am delighted to have the opportunity to join you. I really wanted to suggest that building on what Brad has said particularly outside of the US there are such a broad spectrum of investors not necessarily investors, sources of capital so that it is essential that as an entrepreneur you understand the full range of sources of capital and this builds on bootstrapping but it also is are you aware of how government players are supporting and different kinds of initiatives. Today there are many different kinds of incubators that are providing both coaching as well as sources of capital. So understanding the VC approach and the negotiation between a profit focused investor as well as understanding at the earliest stages in particular how important, how possible is it to find other sources of capital beyond just capital? I think that when you look at the venture dynamic in particular one of the things that is interesting to me about entrepreneurs is that so often financing is seen as a goal in and of itself. So in particular I remember many times in the valley people often ask you the question how much have you raised and who has put in money and I think one of the points as we are discussing capital sources is also to think about the amount, the timing and whether you need it. So raising financing is not a goal in and of itself. It's pretty much jumping onto a treadmill where you have to jump to the next level and I think right now is one of the most exciting times to be an entrepreneur. I remember and I haven't even been out that long but when we had started we were actually racking servers we had to raise far more capital when we had started and so I look now and business can start to say that they had never done before. You have not only more sources of capital I mean crowdfunding was nonexistent at the time. The phenomenon of super angels and the proliferation of angels was far less at the time but I also think now as an entrepreneur you have more channels for customer acquisition you have the app stores which didn't exist just a few years ago. You have Facebook, you have Twitter, you have Pinterest and more people are online. There is over 2 billion people online. So in particular I know I've focused more on online businesses but this phenomenon is really pervading I think all businesses the internet is fundamental everything. I think entrepreneurs should consider as they're looking at financing sources how much do I need is more and more of a question and I think less at the beginning actually is better and better as a general rule of thumb than you're comfortable with and it's just something that I've started to see as a recurring theme that I hope entrepreneurs will take into consideration as they're considering financing. So just to echo some of those sentiments the best way to rate the best source for raising money is revenue from your customer and as you just mentioned there are a lot of ways you can get straight to the customer, get storage on the Amazon cloud and start generating revenue. That's actually what I did with United villages in the early days is found a customer who is willing to give me half of the project fee up front and I took that check, deposited it and started the company. We were profitable from day one. So there is this kind of fascination with raising money and okay I'm going to start the company and now I've got to raise money well take one step back and say who am I ultimately creating value for? It's the customer and is there a way that I can create a minimally viable product especially for software companies without having to raise that much capital because let me tell you investors can give you a headache very quickly so raising outside capital has some strings attached. So I would definitely and the other comments we heard from the gentlemen were focused on the team and I think that's absolutely right because ultimately especially the earlier stage of venture is the more you're just investing in the people and their ability to adapt to a changing environment and market. There's this quotation, no good plan survives the battlefield and I completely agree with that. You can have the greatest idea you're going to go through pivots, you're going to, I can assure you that the brilliant idea you've come up with is not going to end up being exactly what you thought it would be after engaging with the customer. So I think those were some good points to get the conversation started. Great, thank you all. Brad back to you. You are a very successful US venture capitalist and also an accomplished author. Your last book, Venture Deals which I know Shari is using to share class at MIT Sloan is a must read for any entrepreneur. What I would like to ask you as a VC as an investor what are some of the criteria you use in assessing the viability of a venture investment? I'm going to answer this two ways, one from a perspective of the venture firm I'm part of which is Foundry Group and one from the perspective of Techstars which is a mentor driven accelerator that I helped co-found and I'm answering it two ways to illustrate that there is no absolute answer. It's what I said at the beginning. And I'll just reinforce that, the last couple of minutes of comments around what's the best way to raise capital, should you bootstrap, should you raise the least amount. I just strongly disagree that there's an absolute answer. I think it's extremely situational and very, very context specific and I think it works both ways. It's context specific for the entrepreneur and I think it's context specific for the potential investor. So in the case of Foundry Group, my partners and I, there's four of us, we invest all around the US in software and technology companies. We invest early. We don't have to be the first investor but if you've raised more than $3 million you're probably too late for us and we have a set of themes which we talk about very extensively, not just on our website but wherever we go, that define the stuff we invest in. If you're outside of that universe we wouldn't invest in you. So early stage within our themes within the United States, assuming you're within that category of things that we define as our construct, we then as part of the evaluation process go extremely deep on two things. The entrepreneurs and the product and our decision criteria is almost entirely around our desire to work with the entrepreneurs and their desire to work with us and our view of their obsession about the product that they are creating. That's how we evaluate. It's not a spreadsheet exercise. It's not a size of market exercise. It's not a what's your five-year projection exercise. We know all of this dynamic because of the themes that we invest in. So that's how Foundry Group thinks about it. Text stars, which were also deeply involved in. Text stars is a mentor-driven accelerator. It invests a small amount of money, $120,000 in companies that then go through a 90-day program that's incredibly mentor focused. In the context of text stars we say there's four criteria. People, people, people, and the idea. The idea is essentially price of admission. You have to have an idea to even be in the conversation. But then the evaluation dynamics for text stars are all about the people and what that founding team aspires to do, wants to do, is capable to do and actually does during the interaction while they're applying and being evaluated by the text stars program. Great. Thank you very much, Brad. I think the importance of actually realizing there are different types of investors and there's no perfect solution. That's the reason why we want to have a really meaningful conversation with our speakers because I guess it takes a lot of time to actually do the research, initial research, to be able to identify if, for example, Brad through your Foundry Group or through the text stars, you are the type of investor that an entrepreneur would like to approach. I think identifying the priorities and the areas of mutual interest in terms of the specific niches, industries, topics of interest, I think is very critical. And even the different types of sources of capital and what stage they kind of intervene, they come in the process is very critical and we hope to kind of go deeper in these topics through the program. I would like to move now to human. You are a prominent DC entrepreneur and successful who successfully raised capital in US. What was your specific experience in raising capital and some of the things that you have learned the easy way or the hard way, mostly the hard way along the way? So when I look back at the experience and again I think one of the things that the terms Brad used which I will echo is context specific and part of that context could be time. So when we had raised capital there were different windows in time A through D so we've raised quite a bit of capital, well over $60 million over the course of the history of the company. But when we look back at that so for example when we had started and when we first raised our A it was 2005-2006. At that time and we were in the business of social when there was a beginning of social MySpace was the crux of that ecosystem. Facebook was kind of a glimmer in the eye and Twitter was really non-existent frankly in terms of being a global phenomenon as we know it today. And so when you look at that there was a lot of really excitement around social but it was still unknown. So the types of investors that we attracted were very very different than the investors that we attracted when you went forward to say the later stage rounds where that ecosystem had matured it had changed from an environment where there was not a lot of concentration in the competition in terms of the major social networks to a world where it was polarized frankly at the time around Facebook and investors were much more sophisticated they understood the marketplace they had done a couple of turns of investments in social and seen what they liked, what they didn't like and even interact with customers to see what their take was about businesses specifically interacting with social networks which was an area where we were focused on at the time. So I guess one of my big lessons that I would impart just based on this context specific theme that Brad introduced was I think it's critical that entrepreneurs are aware of the time and the market that they're investing in and positioning properly against waves for example and this is very particular and I'm kind of gearing it mostly towards web investments and what have you so the last thing you want to do for example and I'll use social gaming and not to pick on that category but I think people who were riding the beginning of that wave had a very different experience raising capital both in terms of the amount of time and the types of investors attracted versus people who were probably at the tail end and I think knowing where you are in the evolution of a marketplace is critical the one point I would say though which was really really interesting and I think this was echoed you had said something about this and this is team and I think this is critical across rounds so when you're at your A or your seed the entrepreneur or the investors in my opinion that we've worked with on the reverse side when I invested in companies team is pretty much as we discussed all the risk to it because you may shift your product you may pivot and what have you so the end of the day you're investing in the entrepreneur's ability to adapt grow and quote-unquote figure it out I think as you evolve towards the B the C the D and you know if you go that far to some sort of IPO yes the team is absolutely the crux but now you have you know a dynamic marketplace that you probably understand a little better there's going to be union economics that you can assess and actually go into kind of the private equity excelware evaluation and so I think entrepreneurs when you're looking at that from a fundraising perspective just as a general lens make sure that you understand if you're in the early stage to emphasize and make sure that the investors understand either your competency your passion you know your team dynamic like why are you qualified there and that often comes through naturally unfortunately so either you kind of got it or you don't but I do think doing that versus I've seen these huge decks where they have these amazing financial projections and it's not even the five year but even I think now the new cool thing is and maybe this came from the lean start-up paradigm with that's been introduced but here's my customer lifetime value and look at how great the union economics are going to look and you know well you can ask them the natural question what's your sample size you know 100 customers out of a 100,000 person marketplace are not going to necessarily be indicative of a trend per se so just knowing where to lean knowing what how to position your business relative to where both in terms of the financing process but also in terms of evolution in the market I think is a very critical set of skills that at least I took away Thank you Human. Shari as a teacher of raising early stage capital at the MIT Sloan School you have trained hundreds of entrepreneurs on the topic additionally you work significantly with MIT G-Lab and from your own experience in the emerging markets I think it's very relevant what are some of the differences you see in raising capital in US versus internationally any interesting case studies that you would like to share with us So thank you and the first thing that I would like to say is in based on this topic about raising venture capital raising capital for your startup I really want to underscore the importance of Brad Feld's book I brought it this morning it's called Venture Deals we will in an hour cover as much as we can but I use it as the textbook in my course because I think it does the best job of actually getting at the nuts and bolts the very sort of fundamentals while also giving insight into how a smart and very successful VC thinks about the companies he invests in and there are also nice sidebars from the point of view of the entrepreneur so go find it on Amazon and read it because it should be part of your library now to answer your question about how things differ I would really focus on outside of the US know your ecosystem in the US we're really incredibly lucky to have such a rich and dense entrepreneurial ecosystem where all of the pieces are here they are in nine foot neon and as an entrepreneur you can take for granted access to capital smart mentorship a regulatory infrastructure that works and will do what you need to do an IP system that will protect innovations that you come up with when you're operating in a lot of the markets that I think our audience is today some of those pieces may or may not be there some of them are growing some of them are just getting started being able to identify the folks who can be within your community of support who can help point you to the investors maybe they are institutional investors maybe they are angels who wouldn't necessarily be known to you maybe they are part of the diaspora of folks who have moved on to different countries but who care very much about being able to support entrepreneurs back in their home markets you won't necessarily be able to find all of those on your own knowing your ecosystem building your connections to the points who are there in your markets today I work in the RG lab I work with a number of accelerators incubators groups not unlike tech stars in Senegal CTIC DTBI in Tanzania we work with founders Asia in Malaysia we have the opportunity to work with a number of interesting groups across Latin America these are folks who help connect they provide mentorship and coaching but I think just as important they help you to identify and connect your own dots to the ecosystem that will be most important to you as you figure out your funding strategy but also your business model your revenue model identifying the right customers and push forward on product development Thank you Shari and we had the example of Fadi Ghandur who actually invested in Maktub and basically Maktub was acquired by a few years ago and I know that the founders of Maktub now are very actively involved in actually supporting the local entrepreneurial ecosystem so I think it's very critical to identify some of those successful entrepreneurs connecting with them and sharing your story so that actually you may have a chance to actually build the second RMX or Maktub in the local environment now Amir, you are a successful entrepreneur with United Villages and you managed to assemble a very diverse set of investors for your venture if you could share with us some of your experience in terms of the types of investors that you are able to attract to power up and develop your ventures and how you involve those investors to help you build the venture Absolutely, well as an entrepreneur you have to raise money however you can and get outside of your box and I think as we're hearing from the other speakers really kind of see what is happening in the investment market who's funding what, what are other ventures like yours and who do they get funding from? I think also a lot of it is about showing up to events, conferences where, you know, once you've got your kind of hit list where are those investors speaking? You can send people emails, they're never going to read them, you can build big business plans no one's going to look at them, if you get in front of someone and you can actually chat them up and they see your face and that passion and they gleam in your eyes, they're going to remember you and that's the kind of impact that you need to make and that's actually how I was successful in raising my first round was actually an investment conference called Investors Circle and it was actually here in DC and I connected with our lead investor and got him to sit down with me for a cup of coffee and he really listened to what I had to say and that's how things took off but you know, raising money from angels to finding out about a project that UNDP was funding in Paraguay and managed to put a proposal in for that and got funding as a vendor in a light item of a budget for this project of UNDP in Paraguay so that's an example of raising money from a multilateral institution as a for-profit entity. Of course we raise money from venture capital, I think there's been enough talk about that but there's also corporate venture capital where I think is really an excellent source of funding because you are actually getting more than money you are actually getting a distribution channel or services in kind and a number of different assets will come along with that corporation's investment which is why they are making the investment we did this with a company in India called Oxygen which now has taken over United Villages and I am now setting up Oxygen's US subsidiary but they really that made a lot of sense because United Villages and Oxygen 1 plus 1 was 3 and I think that's a source of capital that's often overlooked by entrepreneurs is going to the corporate VC and strategic capital route. I think one of the common things that I've seen and I'm hearing here that I just want to emphasize for entrepreneurs is businesses, especially the capital raising, people emphasize the process and who you go to and pitching and all of these things but the thing that I'd like to kind of underscore is that businesses are built on people people are the ultimate platform whether it's from the founders all the way up to that 100 sales person or your investors and I think a lot of the appeal that I've seen and I'm early on the investing side in terms of being an angel but when I've had the most success and seen the most successes a word that was used a lot here in different contexts was passion and I think entrepreneurs need to remember that at the end of the day knowing your business better than anyone else and connecting with people for lack of a better word emotional level with the understanding that this is what you're going to do and showing that you can go that extra mile that shouldn't be understated and when you're going through and building your business a lot of navigating isn't about reading on the web and all these other things the best tool that you can use is pick up the phone have an advisory board that guides you through where is the macro economy where are the stages well you can pick up the phone if you call 10 smart guys you'll probably get 80-20 some sense for where to go so I would encourage not to forget your blocking and tackling your fundamentals and entrepreneurship when you're emphasizing this process don't forget those it's just about people and relationships and making sure that you call enough of them it's almost like that sales mentality whether you're raising money or actually selling or whatever the problem is people are kind of going to be the lifeblood that are going to get you through it Excellent insights and as part of the interview with Fadi one other thing he mentioned that actually you are actually kind of raising capital by recruiting your first team so he had troubles at the beginning when building Aramax because the talented people that actually he wanted to involve in his venture they were kind of they went for more stable jobs in the big organization so he had to convince each one of them that he has a very reliable business idea he brought them on board and he actually started to build the company with them so to build on the passion and actually selling your vision your idea to your future team members to actually the investors but also to the customers and the second point that he mentioned the importance of actually attracting a very good investor he attracted a reputable US company that took a participation in his company that in addition to the money actually they added additional credibility on some of the markets that he was looking to invest so I want to ask you all for your perspective on the kind of the value of the investing of the investor beyond just the money that are involved you mentioned Amira at the beginning that is not just the money so from your perspective is like as an entrepreneur when you look at the various types of sources of capital and the different types of investors let's see that you are actually you did your research and you found those entrepreneurs that invest in the specific areas that you are interested in they are interested in what other things should the entrepreneur look at in an investor that potentially that may invest in their company let's start with Brad I think I'm going to answer it very very simply we can keep moving around because I'm sensitive to time and I'm going to frame it high level and then I think let's go deep on the specific conversation but I'm just going to reinforce this framing that the questions are questions that sort of aim at a specific answer and I think that when we go around the table we're going to get three very different answers based on what we've heard so far on the specific question and so rather than me give a very specific answer on it let's go around and sort of get everybody's quick view of it and then wrap up from there in terms of the dynamic because I think this comes back to the idea that the entrepreneur has to be very very deep in understanding what's going on and deep in understanding what they're doing as well as what they're trying to get from the investors that they're approaching so let's go around the table to start with Amir you want to say? Well I think before you approach these investors you have to make sure that you're not spinning your wheels that you actually there is a checklist probably if you read this book I'm sure that kind of checklist there are some things that are pretty clear that they're looking for right and don't bother wasting your time unless you can address check marks and I think those check marks are in some ways what I look at is creating this snowball effect you have this idea starts off as an idea gradually you ask someone to join your advisory board who's an expert in that field now you find another programmer who's willing to do it prototype and put it in some of his time now you talk you get an introduction to a potential customer and they give you a letter of intent okay now it's starting to roll so it's part of this is just about creating that snowball effect and getting others to believe and put their little stamp on your idea and say you know what I think this is pretty good if you get enough of that it's just the way Google works right if you get enough people who say hey I think this is good you start to rise to the top of the rankings so part of being successful in raising money is having enough of that snowball effect going when you start to talk to the investor and I think the second part of it is you know raising the amount of capital that is appropriate for the risk level of your venture in the early stages I think that you have a business plan has a ton of assumptions in it but what are two assumptions one of the key assumptions that you could prove with $50,000 I like to call this the critical experiment and I think that is that's critical to launching any new venture is de-risking it by taking one or two of the key assumptions and what can you prove with $50,000 that will de-risk the venture and build more credibility and get you ready for your next larger round great let's start getting questions from the audience so all of them great insights now we have live questions from Ala Khalife from Jordan who asks is crowdsourcing for all ventures and at what point do we know that we are ready for crowdsourcing any one of you? I think you had a pretty active response well we should all join in I think everyone would agree that crowdsourcing isn't for all ventures crowdsourcing makes sense necessarily if it's something tangible if there are crowdsourcing doesn't make sense for component parts for things that are far less easy for the guy in the street to understand there's lots of ways to shape it but there are certain things that if you can feel it touch it understand there's a direct benefit that a human being a guy who's not a Brad Feld understands is much better not a component part not something intangible great let's move to the next question from Eunice Casimi from Morocco what are some of the do's and don'ts of a meeting with investors geez wow so we can do a separate show on this but I mean it's tough to say their actual rules I think I'll give you a couple quick ones that come to top of mind I've never seen any a VC or a professional investor sign NDA so I would encourage don't run bull charging in there depending I would always do find out what the first meeting context is are you in a coffee shop are you in a office who's going to be at the meeting so that you can actually prepare adequately I've seen far too many times someone whip out this big presentation and household you through this really in the wrong situation where the investor is trying to get to know you get coffee and it's like the meeting before the meeting like do I like this guy and then do I want to have a meeting with them so understand what the tones of the meeting are I think those are two things that are pretty easy ones for at least the initial outset I would add to that don't tell an investor the other investors that you're talking to you don't want them ganging up on you until you actually have a signed term sheet and a lead investor going you know they'll say who else are you talking to and if you tell them well it's a very small world and they probably you know investors really know each other very well so they pick up the phone and what do you think of this then they start to have the leverage so that's one thing I learned the hard way another thing is in your early stage like in a pre-revenue product development kind of stage don't raise equity raise convertible notes raise convertible notes with discounts on the series A with warrants for series A when you're at that early stage your first 500,000 do not sell equity your company is not worth anything you're going to get taken you're going to have your shirt taken from you raise convertible that investors are pretty open to this usually and that's actually how I managed to raise about $600,000 that went into a very favorable valuation in the series A great next question is from Orhan Çelik from Turkey for an internet start up outside of the US what would be a better strategy to focus on local markets or start thinking globally from day one so Turkey is a big market you know some countries right if you're in Uruguay you are building globally from day one but larger markets you know Brazil Brazil doesn't have to go abroad if you're a Brazilian entrepreneur if you're in Uruguay you do Turkey is a big sophisticated market with high internet penetration and relatively high income I would say that in fact you have the luxury of being able to build and succeed inside before immediately looking to grow always have that as part of your framework of going global later but you have the luxury of being able to grow internally just one quick point to add to that I think always answer that I would answer those questions with the question because it really depends on what your product and market is to end the stage of the market so for example if you're starting social network number 10 and it's a year after Facebook I would give you different advice where it's four years after Facebook or if you're starting a business to business operation that's let's say like a living social or a group on I'd give you different advice than if you're you know a national business or international business like maybe like a Twilio for example that's API driven so I think it's critical for you to kind of mind through and figure out who you are and ultimately what your end goal is in the context of the market because otherwise you might pace yourself the wrong way. Brad do you want to add or no. No okay next question is from Faisal Shamsuddin from Malaysia what motivates angel investors you're most welcome to join in when you want to participate Brad. I'm happy to answer this point because I've made about a hundred angel investments and I'm involved in lots and lots of angel deals. I think the best angel investors are motivated by personal relationship that they develop with the entrepreneur so there's a spectrum again there's no absolute but the angel investors that are are you know most active most engaged and most helpful are the ones who are excited about working with you and helping you on your journey. They're called angel investors for a reason versus called devil investors. They're supposed to be an angel they're supposed to be helpful to you and there are plenty of angel investors who are devils who will torture you who will ask for you know ridiculous endless amounts of information as they evaluate whether they want to invest or not but again if you can find those angels that have a personal affinity for what you're doing for you for your business and for helping you on your journey those are the best ones. Great great point this is a question from Bakur Tamirat viewing at the US Embassy how do we person persuade international investors to invest in startups from countries like Ethiopia where VC is not prevalent so for countries that are outside and off the radar of typical US folks this is where you have to dig into the diaspora. This is where you have to find the guy who is in the US but whose family or connections to Ethiopia motivates him to stretch beyond what would be his normal parameters. It is hard it's really hard and for now for many markets it really is a function of developing local sources of capital with the hope that the next stage will be finding more and greater not just US but regional investors as well who are looking to understand opportunities inside Ethiopia. Thank you Shari the next question is from Bilal watching at the viewing part of the US Embassy in Algiers recognizing that every entrepreneur will be turned down by a potential investor at some point how do you continue and move on after or no. Any good experiences you can share. Nobody's ever said no to you guys I mean you know the obvious answer to that question is if you believe strongly enough in your idea your product you're not going to let the rejections stop you and I think that is one of the things I tell students at MIT who want to start companies and have ideas as a test sometimes I challenge them I say you know what just don't do this just you went to MIT just go get a good job you know don't mess around with this startup thing it's too hard and if they come back to me say you know Amir I really want to do this that's the kind of determination that is the kind of drive that it takes because you are going to be rejected several several times and not just by investors by talent that you want to hire by you know partners you want to partner with but it's that that that gumption and that single mindedness that I think is common I think among most successful entrepreneurs and using no as fuel is actually something that a lot of entrepreneurs learn the art and science of so okay why yeah so because no inside that no might be buried the secret to the yes so why did you say no well you're I didn't understand the market sizing or you know there's a million questions there and even it's like sales so entrepreneurs I think need to become geared in this sales mentality of instead of saying no and moving on and grinning and bear it okay well let me learn from that and I found actually oftentimes when you start to work with investors in particular and they start seeing you break down the problem you know they're encouraged and they actually want to continue to work with you because they like okay this person is actually trying to figure out the answer that's a great point the next question is from Renat from by Jan can we start raising money from angel investors and crowdfunding at the same time I mean you should raise money you should keep as many you know pots on the on the fire as you can you know I think obviously there's some limit to that but try to go after as many possible funding sources business plan competitions you know grants I think for that first round getting that for that first 50 to 100 hardest and you have to tap any resource that you can great the next question is from Abdel Wahed from Morocco how can we trust the investor and tell her or him or idea how I can protect my intellectual property while raising capital let's give this question to Brad you want to take this one yeah I think it I think it is a very controversial dynamic that I put in the category of entrepreneurs worry about this way too much in investors are in the business of investing in companies not stealing the idea from the entrepreneur and sure you know you hear cases of that happening every now and then as Hoopin said you know don't go in guns blazing and ask a VC to sign an NDA that's the best way to not have a conversation get started I'm a strong believer especially in software and technology and giving your ideas oxygen getting your ideas out there getting more people to hear and respond to them so being more open you'll learn so much more from people by sharing your idea by talking about it by using the activity and exercise of trying to explain it to people and getting their feedback not just their intellectual feedback but their emotional and physical feedback you know the body language that you get from it um entrepreneurs who are secretive and I you know I this is a continual phenomena you know I'm thinking specifically something that happened about 30 days ago I got a you know a 2000 word email from somebody from an entrepreneur who just called called me which is fine I get those emails all the time and it was a 2000 word email and it was almost substance free you know it talked about this amazing thing he was working on but it didn't actually tell me anything and I responded with can you tell me something about it just so I have a clue whether it's something I would respond to or not and well no I'm not really to tell you anything about it or not but I want to you know get to know you better I'm like look when you're ready to talk about the thing you're working on that's when you should engage with it. Back to me yes great great points from Ramad from Pakistan what sort of documentary presentation it's best to impress and convince angels or VCs to invest in a startup what sort of things you you like to see as an investor let's Kuman. I think it depends again on your stage and the context I've seen depending on how hot a market is how good entrepreneurs people invest a hundred thousand dollars in a start up over a cup of coffee so it really depends you know it's different are you talking to someone who's worth a billion dollars or someone who's worth fifty million dollars and so you'll see different people respond to different material but as a general rule of thumb I think a good portfolio I think to build is make sure you have a two to three liner so you can describe in an email make sure you have a one-sheeter that you can attach like an executive summary make sure you have a 10-deck slide and then again it's going to be all stage dependent so if your series you know A I'm going to tell you something different than D if you're in D you better have your financials and everything in order because they're going to invest in a different thesis but if you're in A it may be more some technical architecture what have you but I think those couple pieces of information I've seen pretty universally at some point along the process tend to be helpful I would also just add a video it can really make a big impact it's a short demonstration video that shows the product shows maybe the customer using it even if it's not real that can go a long way and know your customer you know this is in many respects the most important sales call that you'll make so know your customer know their likes know what they're expecting as we talked about try and anticipate the more time that you have spent into understanding what they'll be looking for from you and can deliver that the more likely you'll be successful and one last thing I can't believe I forgot it so shame on me this show is just how suited out I've gotten over the years have a really good demo of if you have your stuff ready great but let you know the thing that I get activated on is when you see an entrepreneur like go through their product and actually bring it to life a little bit now maybe you're not at this stage in its slide where but have some sort of way of demonstrating what where we're going so that it's not this just you know hypothetical world of markets and you know I get one percent look how big my company's worth of you multiply times the six times valuation I think great all great insights and we got a lot of questions after the program I'll be sending it to you some of the questions we could not answer we we I'm afraid we are run we are out of time thank you very much to all of you all the wonderful panelists for your wonderful insights and also to everyone viewing special thanks to hosts around the world for mobilizing their entrepreneurial communities we can continue to help each other and also our local entrepreneurship communities by staying involved with just you can find out more about our next events and we have the next one on Tech Connect on Sales and Networking and we have the founder of Ustream and also Chris Schroder with us please visit our website and join our Facebook community that's very large what just does is builds the capacity and strengthens our ecosystem in Africa, Asia, Africa, Middle East and Turkey this initiative that's built it's led by U.S. State Department and CRDF Global identifies and supports most promising entrepreneurs from around the world and builds their skills through and networking and also provides financial advice we have specific activities like the just tech eye competition the just boot camps and we will be having the tech eye final as part of the Global Entrepreneurship Summit and the Tech Connects like this one that are interactive webcast that connects the entrepreneurial communities around the world with experts from U.S. the on the ground start up boot camp provide very in depth training and mentorship and recognition to entrepreneurs from around the world just did one in East Africa in Tanzania in May and we have connected about 2.5 million young people through entrepreneurship resources through various resources at the State Department and also CRDF Global we train about 3,500 start ups and our global network has about 188,000 entrepreneurs the members of just are very eager to take on the challenges and joys of building their entrepreneurial ventures and actually make a difference around the world generate jobs, generate revenue, become role models for their local community to close I would like to emphasize how important it is really to test out your ventures and go out there talk to your customers like we discussed in the program the history of success is full of entrepreneurs that have tried and failed and tried again numerous times is that really good ones that don't give up never give up and you continue to push your idea they continue to work at their idea and then create a venture that makes it successful this doesn't happen overnight it's a lot of work you need to talk to a lot of people you need to attend different events conferences, talk to investors we just know that you can do it as entrepreneurs and it's all about making the most of any opportunity you are presented and we hope that the tools that we are providing can help make your dream more true we hope to see you again soon at the coming Tech Connect this fall on November 18 you can sign up already on our website and the last thing you can sign up for our newsletter you will find the link to the right of your screen to stay informed about the next Tech Connect and the other activities until then take care and keep in touch thank you