You have to burn money to earn money (or not?

)
Dr. Florian Resatsch FI Mentor, 2011

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What I am NOT
going to do today...

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...replacing your business administration studies!

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What I do
instead?

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Answering
a few questions
1. 2. 3. 4. Build a foundation Making money Spending money Summary

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How plan do you
to make money?
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well you don t need to if you scale fast enough in a B2C business ;)

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You HAVE to make money

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you have a lot of options:
‡ sell (products, saas, deals, etc.) ‡ advertise (on/offline, mobile) ‡ build (tools, software) ‡ matchmake (bidding, auctions) ‡ combinations (freemium, etc.)

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1.

Build a
foundation
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Answer a few questions:
1. 2. 3. 4. 5. 6. What market you are in? (B2B, B2C, Sales-cycles) Do you actually sell stuff? What is your products price point? What are your customer acquisition cost? What are the values and assets you create for investors? Gather key metrics/numbers for your product, market, etc.

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2.

Making
money
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Build YOUR financial model:
1. 2. 3. 4. 5. Build a REAL model Build an INVESTMENT model When do you expect first revenues? How much money you need upfront? Don t underestimate your cost basis

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Investors Angel Investors ‡ Show market size ‡ Proof of concept (you HAVE clients) Potential
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Investors Venture Capital ‡ Number-driven ‡ Milestones

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Investors

The German Stick

http://www.flickr.com/photos/_timl/1074294231/in/photostream/

Hockey Stick

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Investors

The American Stick

http://www.flickr.com/photos/_timl/1074294231/in/photostream/

Hockey Stick

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What are you scaling first?
Users (Reach) Clients (Money)

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What are you scaling first?
Users (Reach) Active Users/Clients (Retention)
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Clients (Money)

Your key metrics
‡ Every company has their ³own´ set of key metrics aside of ‡ revenue ‡ user growth ‡ # of clients ‡ etc. You find your key metrics if ‡ you think about what drives the company ‡ and what you CAN influence ‡ (If you don¶t user your metric to make decisions it is worthless) Then determine the best milestones.
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A very good presentation
http://www.slidesh are.net/dmc500hat s/numbers-notnapkins-simplestartup-metricspresentation

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Important facts you need to know
‡ ‡ ‡ ‡ Cost per Acquisition Average Revenue per User Churn Rate Customer Lifetime Value

« it might take time as a startup to determine these numbers

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3.

Spending
money
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Costs

Rules ‡ Don t underestimate ‡ Be realistic ‡ Always check the cash flow

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Costs
‡ ‡ ‡ ‡ ‡ ‡ Legal costs Travel expenses Utilities Insurances Bookkeeping Licenses (Software) ‡ ‡ ‡ ‡ Communication costs Rent Office products Events

‡ Marketing ‡ Affiliate ‡ SEO/SEM ‡ News/PR ‡ Offline Advertising

‡ Salaries (+30%) ‡ Management Team ‡ IT ‡ Product Manager ‡ Marketing ‡ Sourcing ‡ Operations ‡ Support
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4.

Summary
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Summary
‡ Test Test Test ‡ Try your business model and fail early

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Kontakt

KONTAKT florian@friendticker.com 0179 200 6180 friendticker proudly produced by: servtag GmbH Rosenthaler Str. 2 10119 Berlin Germany www.friendticker.de

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