Getting Funded

Written and originally published on May 24th, 2011 by Bingham McCutchen LLP, a TCN sponsor.

Public companies that wish to pursue restructurings of outstanding debt must address a number of legal and business issues prior to launching any restructuring. This is particularly true for restructurings of convertible debt, which can be more complicated to structure and complete than restructurings of non-convertible debt. Developments over the last several years have provided more clarity with respect to certain of the restructuring issues issuers face with convertible debt. In this article, we review these developments by suggesting some initial questions any issuer should address in pursuing a restructuring, discussing recent developments with respect to these issues and providing an overview of implementation issues with respect to any convertible debt restructuring. For your convenience, we’ve provided this guidance both in a brief overview and in a full analysis.

For more information, contact Mike Conza, Partner at Bingham McCutchen: [email protected]

By Win Burke, President & CEO of Incentive Targeting

Incentive Targeting benefited tremendously from participating in TCN’s Venture Coaching Program because it gave the founding team an opportunity, under the mentorship of coaches experienced in raising funds and building businesses, to refine its business plan and its pitch to investors. It also directly led to my joining the team as their CEO. I was one of the panel of reviewers at one of their TCN presentations, and subsequently became involved in mentoring them. I quickly came to understand how compelling was their product, and how attractive the market opportunity, and concluded that I wanted to become involved full time to more directly and personally help them achieve success.

The people we met through working with TCN helped us secure funding by introducing us to members of several angel groups. These initial introductions led to a funding syndicate of eight angel groups, breaking new ground in angel investing in the New England region. In addition, one of the TCN contacts made industry introductions for us, leading to an agreement with our first grocery retail chain, Big Y, headquartered in Springfield, MA, which has become the springboard for our rapid growth.

By Marielle Segarra of CFO.com, reprinted with permission from this May 13th post.

A young company looking for outside funding won’t get very far without a well-crafted pitch. And pitching to investors doesn’t just mean showing them a raft of numbers; it also requires skillful storytelling. “The biggest challenge is distilling [the pitch] down to something that’s irresistibly compelling,” said Greg Erman, a serial entrepreneur who has founded six medical-technology companies, at a recent conference held by Boston-based The Capital Network, focusing on fundraising for life science startups.

A compelling pitch is especially important for seed-stage companies these days, given current trends in the venture capital market. Although first-time financings by venture firms in 2010 were up about 30% from 2009 — with more than $4 billion going to about 1,000 companies — the flow of funds going to seed-stage firms declined by 2%, according to the Moneytree Report by PricewaterhouseCoopers and the National Venture Capital Association.

Similarly, angel investors poured $20.1 billion into growing companies in 2010, an increase of 14% over 2009, but reduced seed-stage investments by 4%, according to the Center on Venture Research at the University of New Hampshire’s Whittemore School of Business.

Erman was one of several experts who talked about creating and delivering a successful pitch at The Capital Network’s Life Science Venture Fast Track. Here, distilled from their discussion, are five tips for talking to investors:

1. Don’t cold-call potential investors. Use your network instead to connect with angels or venture capitalists. “The first priority in approaching any investor is to have a credible referral,” Erman said. This person should know “enough about the entrepreneur and the business to be able to offer recommendations that are authentic.” If an investor allows electronic submissions, entrepreneurs should submit a plan and try to reach out through a referral.

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By Dan Allred, Senior Relationship Manager at Silicon Valley Bank, and a member of TCN’s Board of Directors.

This is an excerpt from a post on Dan’s blog, Volume Game: Observations on the Innovation Economy from a Boston Banker.

I’ve been reading MassChallenge plans as a judge for a few weeks now, and I want to share some of my feedback on what distinguished those plans I recommended from those I did not.

I’ll speak about the plans in generalities, as I obviously cannot say too much about specific companies as the competition continues, nor would that be appropriate in this kind of forum. There are three primary things that stood out for me and caused me to recommend some plans over others:

1) BIG IDEA: This may sound like a no-brainer, but when you read 20 plans in one setting, you realize that there are lots of business ideas that are only incremental improvements or gains over something that successful companies are already doing. This seems to be especially true with many of the Internet business plans I read. I kept asking myself, if this is such a good market, then why isn’t ABC company (insert Facebook, LinkedIn, etc.) doing this? Of course, I recognize the ability of start-ups to focus on smaller opportunities than big companies and to out-innovate them because of their focus and flexibility, but there still has to be a concept and opportunity that is big enough to matter to customers.

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