Posted by & filed under Accelerator, Entrepreneurship, Funding, Investing, workshop.

Pitching to investors to get funding can be scary. Typical professional investor listens to hundreds of pitches every year, and this makes them busy and impatient. If you don’t make it easy for them to understand why you are the next big thing, they’ll throw you out. You have to earn every second with the investor. Here’s the simple pitch deck structure that the Nestholma startups have been using successfully when pitching to investors for funding.

When you get a meeting with an investor for 20 minutes, don’t expect it to last for 20 minutes. It’ll last as long as the investor thinks you’re interesting. If you have five minutes to pitch on stage, don’t expect the investors to listen for the entire time. If you’re not making sense, they’ll start looking at their phones while waiting for the next pitch. Investors value their time – make sure you value it, as well.

You need to deliver the punchline right in the beginning: what is your big idea, what is the real problem you’re solving and how you do it. Tweet this!

If these seem interesting, only then the investors want to listen to the details and consider funding you. Start with these three first:

1. The elevator pitch needs to say the essentials in 10 seconds

Bankiton pitching for funding at Nestholma Demo DayIn the first 10 seconds you need to convince the listener that you have something interesting to say. Saying your value proposition is a great starting line. Personally, I’m fond of Steve Blank’s value proposition formula “We help X do Y by doing Z”. You need to get the investor excited and curious to hear more why you should get funding from them. The investor may only listen to this!

2. Problem worth solving and funding

What is the problem that needs to be solved (not all problems are like that)? How have you validated that the problem really exists? Don’t over-do this, but make sure that the investor can understand what you are solving and why. If you want to tell a short personal story, this is the place to do it – not in the beginning.

3. Solution that customers are willing to pay for

How can you solve the validated problem in a way that customers are willing to pay for? Be as concrete and specific as possible. Screenshots, workflows or even a short video are great. Stay away from meaningless jargon, such as “Our solution provides unprecedented ease of use and scalability”.

Now you’ve covered the most important things. If you’re still in the room, you can go into details in your pitch to get funding from investors.

4. Real and addressable market and customers

Your opinion about the market doesn’t matter. Numbers are great but explain clearly what is the significance to your business. “We are working in a $3 billion market” may sound nice, but it is meaningless fluff. Show your traction or explain the logic for getting the customers (deals in place, access to customers or distribution channels etc.). Testimonials are always good. When you have a paying or just a potential customer (at early stages) say nice things about you, it’s always powerful.

5. Revenue model for monetizing the value you provide

If you solve a real problem, the customer will want to pay for it. It can be with money, their data, time or, for example, with services that they provide in turn. Give a clear outline of how your company makes money with the idea. What value are your customers paying for, how much and often and who are your partners etc? Focus on the logic. The details – such as $4.99 or $9.99 a month – may change.

Especially at early stages, it’s more important to convince the investors that the logic behind the revenue model makes sense. Tweet this!

6. Your unfair advantage that keeps others away from your market

Do you have something that competitors don’t have or cannot get easily? Be critical about this! It has to be something unique, or don’t say anything. It can be existing deals, IPR or, for example, unique experience. It’s not “great and committed team”. Not everyone has an unfair advantage in the beginning (just think about Google or Facebook in the early days). For an investor, it’s an added benefit but not a showstopper if you don’t have it.

7. Marketing and getting customers

How do you reach your customers? This not a list of the obvious channels (blog, some, Adwords, PR etc.), but your recipe for success. Everyone uses social media channels, but how will you make them work for you? Explain in your pitch what are the most important channels to reach your specific customer base. What is the cost or, for example, conversion rate you’ve validated? Does your product have a growth engine or can you use some clever growth hacking tactic to boost your growth?

8. Why are you better aka positioning

The thing about what makes you unique and why your customers are paying for your product. Make a 2X2 matrix the two most important things in your product as the x- and y-axes. Place your company and the competitors on the matrix. The aim is to give an easy way to see how you compare with others at a glance. You can provide the feature-by-feature comparisons to investors as background materials if requested.

9. Running the business with the numbers

Provide an overview of the business with a simple cash-low estimate. Don’t just make Excel fantasies. Justify the numbers with deals, traction, benchmarks, sales funnel, customer development etc. Your business logic is more important than the plain numbers. Remember that these may end up in the actual funding decision, so don’t treat them lightly.

Don’t show Excel fantasies to investors! You need to justify the numbers with data. Tweet this!

10. The team worth funding

Explain why you have the perfect mix of people and way of working. Why can make a big business out of the idea? Show the core team, but also mention interesting advisors, investors or board members. Unless you have 100 people and a real organization, don’t use titles like SVP of Product. That may sound nice to your mother, but for an investor, it sounds funny. Most investors will tell you that the team is one of the – if not the – most important thing in funding decisions. Therefore sometimes startups start with their team slide. I’d advise against this unless the investors know the team members. Another “greatest full-stack developer in the world” is interesting only if you have a good idea. But if you have Mark Zuckerberg in your team, put that on the cover slide.

11. Roadmap and how you’ll use the funding

Present a timeline that shows what you are going to do and how much money you need for each step. Explain how you are planning to use the investors’ money. Pay also attention also to working capital needs if your solution has, for example, hardware unit costs. Make sure that the roadmap and spending is aligned with your overall message. It sounds strange if you claim to have the best developer team, and now you say that you need to hire more developers. You may need them, but you need to have justified the new hires with, for example, the market opportunity.

12. Make the last words count

We remember the first and last things. Don’t waste time and space on Thank you’s or contact details. They’ll find them if needed. Instead, end with your value proposition. It reminds the investor why you are interesting, what value you provide. And why they should join the ride.

Collectly pitching at Nestholma event

 

Every investor has their own preferences for the pitch content. Depending on your company stage, you will be expected to deliver different types of things. Also, take into account who are the persons in your audience. What interests them, do they like technical details, numbers or something else? Before every investor meeting, make sure you find out what is the expectation. Talk to their portfolio companies, read their blog posts and tweets or just ask the investors.

This blog post is based on one of the more than 20 workshops run during Nestholma’s accelerator program.Check out also how our startups pitch to investors at our Demo Day.

Topi Järvinen @topij

 

Posted by & filed under Entrepreneurship, Funding, Startups.

It’s the beginning of a new year, and time to start working on those new year’s resolutions (if you stumbled upon this post later in the year, even more reasons to get to work NOW! :)). This post won’t help you lose weight but take care one other important resolution: having your precious startup finances in check. Here I will give you 7 tips on how to master one building blocks of startup finances: cash flow management.

In my previous post, I talked about the reasons 4 out of 10 startups fail (spoiler: it’s also related to cash-flow management). In this post, I will give 7 tips to master your cash flow and NOT be one of the 4. Some of the tips sound very simple & obvious, which they are, but they are still forgotten way too often. 

  1. Make it a habit to stop for a couple of minutes once every two weeks, and check the money coming in and going out – cash flow. Preferably do it with an outsider to get an unbiased view. And remember to do it properly! You don’t want to go bankrupt because of a silly calculation error. Tweet about it!
  2. Understand when the incoming money will really be in your account. If you sign a deal today, it doesn’t mean the money will be in your account tomorrow. It could come next month, next year or even later if that is what you agreed! So, understand when you will get the money, and make sure you won’t be out of cash before that. Tweet about it!
  3. Remember that not everyone pays their bills in time. There also might be other problems delaying the payment like dealing with reclamations. So, don’t count on that one payment too much! Tweet about it!
  4. It usually takes 2-3 years before your company is cash-flow positive. Most first-time entrepreneurs believe they can do it less than 6 months. And that obviously means trouble. So, a bit of pessimism will be a good aid in your journey. It is better to be pleasantly surprised than the opposite, especially if it means you will be out of money and business. Tweet about it!
  5. Pivot fast. Startups usually pivot, i.e. change from plan A to plan B or even D 3-5 times at the beginning. And every time you pivot, your revenues will be further and further in the future. So, the faster you pivot the faster you will get money coming in. Tweet about it!
  6. Multiply your estimated need for funding & time frames by 3 (or π/pi if you want to get precise), and you will get much closer to reality. Why three? You just read the reason for it: pivoting. That makes even the best estimates unrealistic. Based on our experience, multiplying the estimates by three gets startups closest to the reality more often than not. So, if you estimate that your product will be ready in 3 months, it usually takes 9 months in reality and so on. Tweet about it!
  7. Understand what you are selling, to whom and for what price. Before you yourself understand what you are doing, it will be hard to convince others to buy. It doesn’t mean your product/business has to be perfect, but no one is going to buy it if it is only almost ready. Tweet about it!

And that’s it! All in all, it usually takes longer and costs more to get your startups going than you’d think. It all might sound pessimistic, but think of it this way: the better you are prepared, the more likely you are going to be one of the success stories!

 

Related post: Why 4/10 startups fail: the realities of cash-flow management

 

Posted by & filed under Fintech, Funding, Press release, Startups.

During the past couple of years Nestholma has invested into 15 Fintech startups, which is more than any other investor in Finland. The company is also one of the most international investors in Finland. Nestholma has invested in startups from Finland, Sweden, Norway, Denmark, USA, Germany, UK and Estonia among others. These startups have participated in the Fintech accelerators Nestholma has organized together with Nordea Bank.

”Fintech is going through big changes. We have a great partner in Nordea, and together we are able to find the startups that have a real potential to succeed in the industry,” says Antti Kosunen, co-founder of Nestholma.

Currently, 35% of Nestholma’s investments have been made into Fintech startups. Fintech will be also a strong focus area in the future in the Nestholma investment portfolio.

More information:
Antti Kosunen
Co-Founder
Nestholma Oy
antti (at) nestholma.com
+358 400 850200

 

 

 

Posted by & filed under Customers, Funding, Product development, Startups.

4 out of 10 first-time entrepreneurs fail because they forget one of the basics: following their revenues and expenditure – cash flow. In established companies balance sheets and income statements are king, but for startups, it is all about following the numbers in their account: money coming in and out. It sounds very simple (and it is!), but still, I have seen way too many startups to fail because of it.

Here are the 3 common reasons this happens:

 

  1. Not checking your revenues & expenditure often enough

Looking at your finances is a tedious task. It’s quite boring, and you already have so many other important things to do. And let’s be honest: only a few of us are excited to look at the row of minus’, which is usually the case at the beginning of the startup journey. Thus we often decide to do it “tomorrow”. And more often than not, the startups notice the warning sign too late.

  1. Being too optimistic

You need to have a bit of crazy optimism when you are an entrepreneur, but not when you are estimating things like your expenses, funding needs and time x, y and z will take. Startups tend to make their estimates only a small portion of what they really are, which makes them very ill-prepared.

But why that happens? It is partly being overly optimistic & part not understanding how startups work. Things rarely work out how and when you want them to, and there are many variables you just can’t predict. The market, competition, and even the customers’ needs will change. As time goes by, you will also start to understand your customers better. All this means you will have to make adjustments to achieve better product-market fit. Startups usually pivot, i.e. change from plan A to plan B (or even to plan Z!) 3-5 times at the beginning. All this take time and money and push the time of your first sale forward. But expenses still start from day one.

That is why it is important to constantly check your cash flow and be realistic about the ‘whens’ and ‘how muchs’. When you do that, you know when you are going to be out of money and still have time to do something about it. It takes 3-6 months to get funding, investments, etc. so I can’t stress enough how important it is to knowing when you are out of money early enough. Too many startups come up to me less than a week before they were out of money and still believed they would magically make it. You can guess what really happened.

  1. Not understanding when the money is actually coming to your account

For some reason, many startups believe that when they sign a deal, their money-related problems will fly out of the window. But that is not how it works. It might take weeks, months if not even years before the money is actually in your account! It all depends on what you agreed. Also, not everyone pays their bills in time. Trust me, it happens more often that you’d think. There also might be other problems delaying payments like dealing with reclamations. But again: your expenses won’t wait. So remember: even though money is coming in, sooner or later, you might be out of money and bankrupt well before that! Ask yourself: when exactly we will get the money, and will we survive till then.

In my next post, I will give you more concrete tips on how to get your time frames and expense estimates close to reality.

 

Related post: 7 tips on how to ace your startup finances – cash-flow management

 

Posted by & filed under Customers, Funding, General, Programs, Startups.

This is a guest post by Maarit Cimolonskas from Feelingstream

Feelingstream is one of our portfolio startups (feelingstream.com). FeelingStream helps large service companies improve customer experience by analyzing customer messages and providing actionable insight on customer feelings using smart analytics. They participated in the first Nordea and Nestholma Startup Accelerator batch. Applications for the next batch is open: apply and read more.

Antti / Nestholma

You have a great idea, so you start it up.  Every founder knows that it’s hard to launch a successful startup. We’ve all heard stories about both startups who fail and startuppers who do it for networking. The truth is that turning a great idea into a profitable business is a difficult journey! Joining an accelerator might help you here and we wanted to put down some of the lessons we believe are relevant to do it.

Accelerator supports your startup

You want to start real business and accelerator advances your doings.

At the same time it equals a lot of work. It might happen that startups wait of being changed better after they join an accelerator. What actually happens is that they are given a better hook to catch a bigger fish!

Intense experience brings accelerated knowledge.

Be prepared that the way you think about the problem you solve may change more than once. The time you spent at the accelerator may come as being too overwhelming and intense at the same time. What it actually brings with is that you get faster answers about the business problem and clearer view about actual business impact.

Take the courage and start creating raving fans as soon as you can.

Profitable business means speaking to actual customers. To start relationships with your customers, you need to get close to their stories. And you need to listen what they have to say. It of course depends on the field you’re in, but the accelerator might as well serve as the gateway to your future customers.

 Accelerator should create as much value as you create value for customers.

Instead of choosing one that brings you more monetary value, go for the one that helps you get closer to your potential customer. Accelerators connected to certain fields bring you actual people with real cases. The sooner you get to know your customer, the better.

Know what you’re missing or where you need to improve. 

Even if your mind acts like sponge for knowledge, it’s good to understand that opinions are different and that in the end, it’s your startup that you want to turn into a business. Mentors are useful only if you know what you need their input for.

Develop and help others develop.

You’re in it together with the teams a lot like you and completely different at the same time.  You’re lucky to have other talented minds around you. They want to help you and giving feedback to other teams might just show you some advancement too.

These are our feelings after participating at the Nordea Nestholma Startup Accelerator. An intense time but what a ride!

Good luck and feel on!

Terje from Feelingstream

– Maarit, Feelingstream

Read more about Feelingstrem at feelingstream.com

Applications for the next Nordea Startup Accelerator batch is open: apply and read more.

Posted by & filed under Funding, General, Press release, Startups, Technology.

Yrityskiihdyttämö Nestholmasta liikkeelle lähteneen Neonto Oy:n joukkorahoituskierros ylimerkittiin vikkelästi. Neonton joukkorahoituskierros on yrityskiihdyttämö Nestholman ja Invesdorin yhteistyön ensimmäisiä hedelmiä.

Mobiilisovellusten suunnittelutyökaluja tekevä Neonto Oy lähti hakemaan osakeannilla 25 000–50 000 euroa, mutta keräsikin noin kolmessa viikossa lähes 60 000 euroa. Anti jouduttiin sulkemaan etuajassa odotukset ylittäneen kysynnän vuoksi.

”Joukkorahoituskierroksella halusimme antaa tuotteen varhaisille käyttäjille mahdollisuuden tulla omistajiksi ja hyötyä tulevasta menestyksestä. Tämä onnistui nimenomaan Invesdorin osakepohjaisen rahoitusmallin ansiosta”, Neonto Oy:n toimitusjohtaja Pauli Ojala kiittelee. “Lisäksi nyt saavutettu tulos luo hyvän pohjan sille, että Neonto on haluttu sijoituskohde myös tulevissa rahoituskierroksissa. Olemme iloisesti yllättyneitä ja erittäin kiitollisia sijoittajilta saamastamme vastaanotosta.”

Yhtiön tuote, Neonto Studio, on suunnittelijoille tarkoitettu visuaalinen työkalu mobiilisovellusten luomiseen. Se mahdollistaa aidosti natiivien mobiilisovellusten luomisen ilman ohjelmointitaitoja.

Idea Neonto Oy:n joukkorahoituskierrokselle kumpusi Nestholman kiihdyttämöohjelmasta, jossa yritys on mukana. Invesdor on ohjelman virallinen joukkorahoituskumppani.

”Invesdorin palvelu rokkaa ja Nestholma tukee startupeja monipuolisesti. Tämä on kova yhdistelmä”, Nestholman perustajajäsen Antti Kosunen toteaa. ”Yhteistyö Invesdorin, Nestholman ja Neonton välillä toimi saumattomasti, mikä näkyy annin vakuuttavassa ylimerkinnässä. Nestholmalla on kykyä tarjota startupeille erinomaista tukea, ja näemme yhteistyön jatkuvan menestyksekkäänä”, Mäkelä komppaa.

Lisätietoja

Pauli Ojala
Toimitusjohtaja,
CTO Neonto Oy
[email protected]

Antti Kosunen
Perustajajäsen
Nestholma Oy
Puh.+358 400 850 200
[email protected]

Lasse Mäkelä
Toimitusjohtaja
Invesdor Oy
Puh. +358 40 753 3844
[email protected]

Nestholma lyhyesti
Nestholma on startup-kiihdyttämö, joka tarjoaa isoille yrityksille ja startupeille uudenlaisen tavan tehdä yhteistyötä. Tavoitteena on tarjota kiinnostaville startupeille mahdollisuus työskennellä, oppia ja partneroitua samalla alalla toimivan ison yrityksen kanssa. Isolle yritykselle Nestholman kolmen kuukauden kiihdyttämöohjelma tarjoaa uudenlaisen ja nopean tavan tehdä kehitys- ja innovaatiotoimintaa sekä löytää ja ohjata uusia partnereita. www.nestholma.com

Neonto lyhyesti
Neonton perustajina on joukko digitaalisten sisältöjen, mobiiliteknologian ja käyttökokemuksen suunnittelun ammattilaisia, joiden missiona on muuttaa tapaa jolla mobiilisovelluksia kehitetään. Neonton ideana on tarjota suunnittelijoille työkalu, jonka avulla he voivat itsenäisesti toteuttaa ideoitaan mobiililaitteille. Neonton tuote, Neonto Studio, julkaistaan alkuvuoden 2015 aikana.

Invesdor lyhyesti
Invesdor on Pohjois-Euroopan johtavia osakepohjaisen joukkorahoituksen palveluja. Invesdor pyrkii vauhdittamaan Suomen talouskasvua parantamalla startup- ja kasvuyritysten mahdollisuuksia saada rahoitusta. Autamme pääomaa etsiviä yrityksiä ja kasvuyrityksistä kiinnostuneita yksityisiä sijoittajia löytämään toisensa verkossa. Pääoma tulee sijoittajilta eri puolilta maailmaa. Lisää tietoa yrityksestämme ja palveluistamme osoitteessa invesdor.com.

Posted by & filed under Funding, General, Press release, Startups.

 

Press release December 19, 2014
For immediate release

Copyright Seppo SamuliThe eight startups that participated in the media startup accelerator run by Nestholma and Yle, graduated from the program with high praise.

Startups pitched their service to potential investors in the Demo Day that was the final event in the program. Every startup has already received their first round of funding, and investors have already shown a great deal of interest to participate in the next funding rounds.

“I’m extremely proud of this batch of startups. They’ve shown excellent progress over the past months. By validating their ideas with customers, every one of them has found viable model to go forward” says Topi Järvinen, managing director of Nestholma. Järvinen adds “I’m also very happy with the cooperation with Yle and Elisa. This has been a very good example on how the cooperation between large corporations and startups is beneficial for both”.

Check out the pitch videos at https://www.nestholma.com/yle-media-startup-accelerator/demo-day.html

Startups

ClipMe offers new ways to create and share moments together with people you love through 15-second collaborative videos. Made with smartphones, ClipMe videos can be shared and viewed on Facebook, Twitter and anywhere on the web. Over 2500 video stories have been shared on ClipMe from 98 countries and 220 cities of the world. ClipMe is available on iOS, Android and Windows Phone. http://clipme.in/

Nau App is a location-based spontaneous meet-up platform. Stop planning and start doing it nau. Reach out to your networks close by and spontaneously meet up. Nau app adds location and time to your social networks and helps to find the right company for your activities close by. Nau app is tested with business school in the Nordics and will be launched in early 2015. www.nauapp.com

Remarket changes the way we consume fashion. It’s an online marketplace for quality second hand clothing, where users can turn items they no longer wear, into money and more space. Selection is curated, so shoppers can enjoy second hand pieces that never compromise quality or style. Remarket launches in early 2015.

SoundShade is a simple audio application that helps to focus on the task at hand. All of the natural, listen-for-hours sounds from our library can be arranged in the surround sound space as you wish. SoundShade is available for iPhone and iPad worldwide in December 2014.www.soundshade.me

Speeky is the number fun voice messaging service. We help you to send voice messages to your friends that make them smile! Speeky for iPhone will launch in January 2014. www.speeky.co/get

SuprView is an innovative Startup commercializing technology of Augmented Reality (AR), we are designing an easy to use architectural visualizer that utilizes latest augmented reality and mobile technology to display realistic 3D models of buildings outdoors. Our product helps building manufacturers or architects show buildings to their customers in any location making it possible to see how they fit into the surrounding environment. We have a beta version of our application on Android.http://suprview.fi/n/

Viima makes feedback collection social, visual and fun! By using our software, companies get an instant overview on the most important customer needs. During its first year Viima reached 20k€ in revenue while developing and validating the product with pilot customers. https://www.viima.com/

Wooffer is an online dog competition service which allows users to compete against each other with dog videos and pictures. With Wooffer dog fans can also create their own competitions. www.wooffer.com

See more at www.nestholma.com/portfolio.html

Further information

Nestholma, managing director Topi Järvinen, topi (at) nestholma.com, +358 40 754 3131

Nestholma is a startup accelerator that helps large companies and startups to work together. The objective is to provide large companies a clear model and tools that help them to innovate and build new businesses faster together with startups. For startups Nestholma offers funding and the opportunity to work with and learn from a larger company that is a potential partner. Nestholma has received support for the project from the European Social Fund.

www.nestholma.com.

Posted by & filed under Customers, Funding, General, Startups.

Pentti Mansukoski

Nestholma Mentors’ Voice, part 3: Pentti Mansukoski. In the coming weeks we’ll showcase mentors that will be active in the Yle Media Startup Accelerator Program. We’ve already featured Will Cardwell and Antti Kosunen Check back soon to see others.

Who are you?

Just two or three years back I was an investment banker with Nordea. I have a banking career of 28 years, including titles such as executive director and head of corporate finance, Nordic head of acquisition finance, head of large corporate customers in Finland, head of commercial banking at the New York branch etc. The last eight years with Nordea I was working dominantly as a financial advisor in M&A and equity transactions.

I made the career change to align better working hours with my personal interests and, I believe, my skills and talents. Currently I’m self employed, working through our family company Elfhill Oy. I am a professional photographer – my passion since age of 15. In addition, I work with selected start-ups as advisor/mentor and also as an investor. We also have tiny book publishing activities, an area we plan to develop in near term future. I also keep my previous profession active by advising few companies in financing issues and in general financial management.

In the past I have analyzed hundreds of different businesses, many of which I have worked with extensively, debating the strategies with top management teams or owners. This has given me a solid basis to evaluate business concepts and strategies – indeed I think I’m pretty good in picking up business concepts regardless of industry in question. Extensive managerial and leadership experience is useful when thinking what motivates people and why the do what they do. Adding to this my keen interest in visual communication, pictures, videos and everything related I feel Nestholma’s activity is a unique opportunity for me to utilize pretty much all skills I’ve accumulated so far..

Why the Yle Media Startup Accelerator is important?

I believe Yle Media Startup Accelerator is a great initiative for a host of reasons: we all are broadly aware of ongoing media changes but it will be more dramatic, faster and more unexpected than most of us can imagine. The Accelerator may allow Yle not just quickly follow the media market but also create completely new services. I think Yle has a very, very important role in the Finnish media industry. However, it is important that Yle is constantly looking for new ideas, services and ways to play its role even better, to the joy and benefit of all citizens. The Accelerator is a good method to bring in fresh ideas and initiatives in a cost effective, well managed way.

What is one important thing for every startup to keep in mind?

There are several pitfalls which start-ups face at some point. I have too often seen that the start-up team has fallen in love with their idea, or with the path they selected to use in commercializing the idea. The trap then is to start denying customer feedback or other clear signals saying they should change the course. So, if one important thing is chosen, I would underline the importance of listening to the market and prospective customers – and if one chooses to proceed against these signals, he or she should make sure it is done based on a solid, well-thought decision.

More about Pentti in LinkedIn