Silicon Valley. Where Startups Are Made and Where to Find Investments

Today, as promised, will tell you how to make $1,000,000 per year and does not bend on the hill uncle. It goes on forex or trade in moonshine festival bards, our story is about startups. It’s a sect of people who go in T-shirts with the names of unknown sites / services, and tell pitch his brilliant ideas while you are traveling in the elevator. As in every sect, the startups have their own guru and teaching, according to which the highest level of enlightenment — is access to the IPO. But before that startups need to go through seven circles of funding to build an office in Silicon Valley and buy a two-bedroom house for $1.5 million in Palo Alto. Then we can safely say that you have attained moksha.

There are many ways to become startups, but we will talk about the classic it best fits into the concept of the American dream. It all starts in college (mostly good), when young people are ambitious and full of hope. They do not want to devote his life to monotonous office work and service soulless corporations. Often this is added a romantic desire to create something useful for society. Then only one way out — to create their own business to other people devote life work for you.

The case remains for small — to select business idea. Of course, it is not easy, and for creative individuals this can become a real torture, because sometimes ideas surplus even worse than their absence. As with all his “children” to select the favorite, there stupor and begin the real suffering. “I love everyone that sings well, and this runs quickly, they are also all different and beautiful in its own way.” As a result, it is easier to go to work in a suррket merchandisers, ketchup permutations of salary changes. In this regard, jealous man with one idiotic “child” is, perhaps, not very clever, but only one, and it will work round the clock, otherwise it will not be a full citizen. We hope you understand the basic idea of ​​the metaphor novice startups should choose one idea and devote himself to its development, without being distracted by better fed topic.

Speaking of debility. There is another category of startups who fanatically fixated on one single holiday ideas and believe that it will change the world. Because they are afraid to talk about it, even people who will bring the idea to the next level. This fear of “theft” completely unsubstantiated. Start-ups simply do not realize that the idea itself is worthless. This is for two reasons. The first — any idea easily copied. After starting the project is likely to have a month or two there will counterparts. So much more important to have a good team and prudent marketer. The second reason — the genius idea can become its main enemy. If people never had such a thing, you have to spend a lot of time and money to explain the essence, in other words — to create a market. Because investors prefer startups that solve existing problems.

You have chosen thought and idea (admittedly, no matter what), confirmed that it is better than counterparts. It took several weeks. Everything goes fine, you’re in sweat, little sleep, eat poorly, rarely wash, but you’re happy. You own 100% of the company’s perspective, there is only one small problemki — if you are not a child prodigy or Asian, the startup can be delayed a little… a year and a half. To shorten this period, you will need an assistant. And since the money you have is not, then only pay what you can — it’s the company’s shares, as Assistant automatically becomes a partner, often equal — 50 to 50. What do you think, who wants to waste their time on smaller percentage if the vague future, and idea, we found virtually worthless. Usually partners startups become roommates in a dormitory, school friends or acquaintances of the conference.

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Discussed the role of each partner, work on the project continues with renewed vigor and twice as intense. Next control point will come in a few weeks or months, there is no clear boundary, but the symptoms are easily recognizable. Everything starts with the fact that instead of computer code and badly dressed girls you snytymetsya food. And not “Mivina” you eat last month and luxurious steak or my mother’s soup (although that soup, but we… US startups chili, chili you snytymetsya). Partner zazhurytsya too little, bezhrishshya and friendly barb will stretch, and the question of monetization startup will rise more and more. This means that it is time to look first investment, otherwise the company can die even born. Initially, you can count on two funding sources, or three — if you have rich relatives. And — this is investors angels (very nice and the exact name) and startup incubators.

Great incubators respected not so much, 10. The most famous pieces: Y Combinator, TechStars, AngelPad, 500 Startups, DreamIt Ventures, Launchpad LA and some more. Incubators startups gain of 1-2 times per year. To participate in the selection must complete a form telling about himself, partners, your achievements in the past, then we must describe their idea obisraty existing analog and calculate how much money your company will bring to investors. Incubators often invest in the team and the people, not in the idea, so try to talk about himself as an original, impress the person who will read your application, show her that you are cool and creative. Your idea may be in the background if you like a person, the idea can change / replace important to get into the clip. Actually, advice and mentoring — is the main advantage of incubators. A good advice is always the best for the money, the more money that you give a little, thousands of 10-20 for 10-15% of the company. That should be enough for 3-6 months, then if you zapustytes or get new investment — you asshole.

Sending out applications to all incubators, will not sit idly by waiting for a response. Especially because they can not be, or rather will send a letter to you in any case, but the positive response comes quite rare. According to statistics, incubator TechStars receives about 4,000 applications a year, of which only 1% disapprove. So little a rest… and will continue to work? In a sense, yes. Continue search investment. It’s time to try myself in a new role — stand-up comedian, from the world of IT. Our target audience will be angels investors, but we do not We shall of funny observation of life, not zhartuvatymemo about sex, we will sell the idea. As is common with stand-up? We also need good material that we will hone to an infinite number of “open microphone” until you get rid of all the excess and correctly pick up every word. A performance space — the same, nightclubs and fast food.

Today we will visit one of these “microphones” which, by the way, the winner gets a nice cash prize of flocks of angels.

The event takes place in a nightclub in downtown San Francisco. This imposing man — the owner of the club, he arranges these meetings several times a month to help talented young people.

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Startups come on stage one by one and try to impress the jury pitch.

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In the speaker is 2 minutes, because every word counts. Experienced pitcher thoughtful speech to the smallest details, lined logical object, subject and scientific innovation, no unnecessary pauses and zayikan. Head west gestures tells how much time is left before the end of the performance.

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Here follows are angels without wings, but with money. Angel Modern standards are not that high, you must have a desire to help / make and $1 million in a bank account or income of $200 thousand per year (requirements for accredited investors).

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After the speech, last stendapera jury briefly advised. This happens very quietly and almost without debate.

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Participants line up to see the winner. Today, someone will get the first investment.

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All expire very quickly, no celebrations, exchange handshakes, contacts and club are launching the first visitors, while Davy Jones mounts the stage.

Those unlucky today, go home, analyze and process the speech. Tomorrow they will come back to the microphone, but otherwise the room.

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Another popular venue startups and programmers — mitapy ( http://meetup.com/ ). Nothing pitch and exchange experiences, talk about modern technologies and eat free, which is important for the body of a young emerging entrepreneur.

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Atmosphere relaxed, the lecturer can easily posorbuvaty beer.

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In the hall of the people is also not particularly busy. In such circumstances it easy to find like-minded people and partners so mitapy play an important role in the cycle of start-ups in nature.

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The next stage, after open microphones — a startup festival. This competition is tougher, but serious money to spin, so you should be given to such measures when you are natrenuvaly zapylyaly tongue and a little working prototype. Festivals attending venture capital funds and major investors, but talking about investments they start anywhere from 500,000, which means that they need to assess your company at least $4 million. If you have not grown to such numbers, do not worry, you can come later unless zakryyetesya.

Well, if you are interested in ventures, and they are willing to give you money, you need to calculate how much interest the company will have to pay. Is a simple formula. Suppose your company, investors valued the same as 4 million and 500 thousand give you how much interest you You give them 500 thousand / 4,000,000 = 1/8 = 12.5%? This may answer the most obvious — but wrong.

In fact, the formula is:

500 thousand / (4 million 500 thousand) = 1/9 = 11.1%. Sometimes 1% can cost millions a bunch, so it’s best to consider carefully.

Why we have added investments to the value of the company? It’s very simple, first you take the money, and then you’d shares. If you give shares to getting investment, the investor would you more as a percentage.

To use the formula is not just on paper, but in life, let’s visit the largest festival in the world of start-ups (as stated on their website) — Launch Festival ( www.launchfestival. com ). 3 days. 4 scenes. 250 speakers. 15,000 entrepreneurs.

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Admission is $75 for startups and from 300 to 3000 dollars for visitors. We did not pretend himself young businessmen to save… and were free as the press. So, now you read the first report of the new Ukrainian edition of Internet business and modern technology.

And so you have not lost interest, we offer to play a game. Called “Fine Line or” we show you a start, tell his idea, and you have to guess he was founder of investment or had to find a real job. Answers, visit the our page on Facebook .

Let’s go. Our first participant — CommitChange. The project brings together on one platform nonprofits and donors, the goal — a more effective fundraiser. The investments — 287 thousand dollars, but as it turned out — a loan, not the infusion from investors. Thus, the nature of the case and such dedication. Well, think the guy got investment?

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Go on. TinkerEd — EdTech-service connects companies with teachers. Unlike the usual freelancing is that customers are the companies that make tools for training and they need skilled care or expertise, as opposed to the penny on freelance assignments.

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Australians. Pricify — service tracks the prices of goods that you’d really like to buy, but the toad presses. But when the price drops — you get the message.

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KptnCook — application for people who do not know what to cook for dinner. Service prompt delicious recipe raspishut which products and in what quantities are needed, as well as their value in the nearest grocery store. Founder and CEO of the California startup, a girl from Kyiv — Polina Marchenko.

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Ensa — a mobile app that combines your medical records with all kinds of fitness apps, then give personalized recommendations to maintain good physical shape.

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FLYR — guys with a fantastic and very interesting idea. They predict the price of air travel on the basis of a large number of different information. Then, these forecasts are used by developers to create effective tools for booking tickets.

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Startup of Israel — Bizzabo. Platform “all-in-one” to organize and manage any events and activities.

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Sqwiggle — online workspace that allows remote teams to work together.

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Reconiz — microblogging platform with a focus on show business. With interesting features — you can track the location of celebrity, reported by users of service. So if you want a cup of coffee with Beyonce — quickly upload Reconiz.

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German startup helps control absence.io vacation, sick leave or other serious reasons why employees are absent from work.

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Flinja help find a job has 100,000 students. Service use primarily employers who need workers on a temporary project. Such a vilnonaym young.

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Let’s make a short break for lunch, and then you’re probably already tired of this flow of information. Let’s see what fed festivals.

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What promotes this young man, we have not found it all day namotuvav range of virtual reality. Hopefully he missed investors.

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Rested? Come again in “or Fine Line.”

MeFinder — a great idea for tusovyh people. Upload the app, add your face, and you can find all the photos with you on the phones of other people who have found MeFinder, of course. Essential thing for a Saturday morning, you can see what you natvoryly yesterday and it does not bother asking friends reset photographs.

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Startup from Sweden Userbin — addition two-step authentication to protect your oblikovok of ardent kulhatskeriv.

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Findy — search service for sharing lessons friend likes. It sounds ambiguous, but nothing to do with the Mamba Lavplenet or not, we checked.

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uBiome — serious startup that deals microbiome research. You send the set, you spend special indicators in these parts of the body and send the data for analysis. Later research results get your “inner world”.

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Perhaps for the first time enough startups. Moreover, about 14990 we still do not have time to tell. Let us rather see what happens in other pavilions.

In this example, acts Uber founder. Tells about plans to capture the Ukrainian market and why Chanson taxi — this past century.

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And then all the spiritual leader and co-founder of US startups incubator Y Combinator — Paul Graham. Largely because of it thousands of young people at night, sawing their proektyky, sleep on the sofa in the parents eat poorly and dream of millions. Very much inspired by his essay.

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Here follows closely a person who has invested in Airbnb, Dropbox, 9Gag, Reddit, Scribd Weebly and, when it was not yet mainstream. Full list of companies can be found here http://yclist.com/ . The total value of 172 companies funded by Y Combinator and which were bought by bigger companies or have received further funding amounted to 7.78 billion, an average of 45.2 million for the company. Not bad, huh? This is due to the fact that the incubator provides 10 to 20 thousand cultivated investments in 10-15% of the company. That is the nature of incubators, as few people can recognize the idea of ​​a billion in a simple prototype, and without strict guidance and it may remain in the program knees. Moreover, we must remember that hundreds of ideas funded shoot 1-2, but they will pay full costs.

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The next speaker Mark Kyuban, eccentric billionaire investor and owner of Basketball Club Dallas Meveriks.

He seems to say to us: “Ey! Hey, is the investment? And if I will! ”

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Take photos of 2 billionaires overnight — Achievement unlocked.

Billionaire photograph close — Achievement unlocked.

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In other pavilions go infinite pitch and presentations.

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The room is pleasant aroma hopes, with light notes of investments.

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Well, what then, when startups passed all rounds of funding and close to the IPO, which has an office look such a well established company and where it is located? In Mecca of IT people — in Silicon Valley, it is 40 minutes by train from San Francisco. Let’s go, let’s see.

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By the way, our term Silicon Valley was born because of the similarity of writing English words silicon (silicon) and silicone (silicone). The correct name — Silicon Valley. The real Silicon Valley is located to the south, near Los Angeles — is the San Fernando Valley, it is often called Pornodolyna, a global center of production of pornography.

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Moffett Airfield in Sunnyvale — the heart of Silicon Valley, this place began her story. In 30-40 years based at the airfield and military airships in the vicinity of many technology companies created to serve the needs of the air base. Then the airship moved and left the company.

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Across the road from the airport the offices of Microsoft, Google and Comcast, and will go there.

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Unfortunately, Google no special invitation is not allowed, as limited souvenir shops.

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And some intricate mechanism in the lobby.

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But as we found Comcast “end” and got inside. Calling Komkast startups do not dare, today it is one of the largest mediakorporatsiy in the US, but in 1963 they also started small. The headquarters is located in Philadelphia and Valley-based research center.

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The office is designed on the principle of open space. This principle is gaining popularity here, but the US is still debatable which is better: individual kubikly, kubikly several people or open space. Therefore, in the offices of large corporations can be seen that the second and third.

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On the wall board with the schedule deadlines and different motivational stupid.

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This is part of the methodology Skram. This methodology is used in large and very companies for more flexible development projects. The entire staff shares no small teams that work independently of each other. The team meets daily to hear from skram-master work plan, share problems or get lyuley.

Such fees are stavma that no one distracted. Apparently the guy on the right, from time to time such meetings tightened.

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In between the work can play football.

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Board Games.

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Megaskrebbl.

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Or ponudhuvaty the kitchen.

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Overall, insidious capitalists are doing everything to workers as much time spent in the office.

But we men are free, without a mortgage. So Freestuff sneakers us do not work. Come see better what kind of a Valley street instead of offices.

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In general, this one-story building without glamor and gloss. Nevertheless, even a hut on chicken legs cost of $1 million. More or less decent housing starts 1.7-2 million. But the concept of decent does not include a swimming pool and a large back yard.

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The local clinic.

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Chiropractic office.

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