Venture Capital Investment Competition (VCIC) Info Session | - PowerPoint PPT Presentation

Venture Capital Investment Competition (VCIC) Info Session | October 2018

Welcome and Intros • Nora Mansfield Senior Program Manager, Polsky Center, and VCIC Organizer • Scott Meadow Chicago Booth professor and VCIC Faculty Advisor • Cerise Miller Assistant Director, Polsky Center, and VCIC Organizer • Meha Patel EVC Co-Chair and VCIC Organizer MBA ’19, alternate team-member in 2017-18 VCIC 2

What is the VCIC?  Day-long investment competition  Student teams role-play as venture capital firms  Real-world entrepreneurs currently seeking funding present their businesses to student teams – Businesses tend to be early-stage opportunities representing various industries 3

Benefits of Competing “VCIC was a capstone to the entrepreneurship classes at Booth. We leaned on courses like CI, EFPE, and NVS. Since we looked at real companies and negotiated with actual entrepreneurs, it added practical, human experience to my education.” “One of the best learning experiences at Booth for how to actually be a venture capitalist.” “It’s hard to judge who will be good at venture investing from academics, but VCIC is the closest thing to real VC action, so it’s the best indicator of VC potential for MBAs.” 4

VCIC Overview of Competition  Teams receive entrepreneur materials, begin due diligence  Judge and Team Orientations Entrepreneur Pitches – 10 mins   Q&A Rotations – 15 mins with each entrepreneur  Student Teams Draft Term Sheets – 1 hr, 15 mins  Partner Meetings – 15 mins each  Round 1 Voting Top 2 Teams Negotiate – 10 mins   Awards Ceremony and Reception 5

Regionals and Global Finals  The VCIC is a global competition  Winner of the Chicago Booth VCIC advances to regionals  Regional competition takes place in Boulder, CO on February 8, 2019 – 1st place $1000  Global VCIC takes place at the University of North Carolina, Chapel Hill on April 12-13, 2019 1st place $5,000; 2nd place $2,500 – NOTE: Winning team in the Chicago Booth VCIC must be available to go to regional and national competitions 6

In 2016, TWO Booth Teams Win Regionals; Take 2nd and 3rd Place in Global VCIC 7

In 2017, Booth Team Competed at Regionals and Took 2 nd Place 8

In 2018, Booth Team Competed at Regionals and Took 1st Place 9

Why Hold a Chicago Booth VCIC? One-of-a-kind competition providing real-world venture capital  experience  Student teams interact with real CEOs from real companies with real business plans  Students work with venture capital investors and practice making investment decisions  Supports Booth’s leading position in entrepreneurship and venture capital  Determines which team will represent Booth at the regional and national competitions 10

Internal Competition Timeline  Wednesday, Nov 21, 2018: VCIC application deadline (application is online)  Early December 2018: Teams selected and notified  Early January 2019: Mandatory orientation session for selected teams  Wed, Jan 16, 2019: Teams receive business materials, begin due diligence  Friday, Jan 18, 2019: Chicago Booth VCIC 11

Eligibility  Open to all currently-enrolled MBA students at Chicago Booth – Includes full-time, part-time, and EMBA Booth students  Students from other universities are not eligible to participate  For Chicago Booth's VCIC, teams must have five core members – Teams may also have up to two alternates, who would only compete in the Booth VCIC if another team member is unable to participate – Alternates can assist with preparation and term sheet development. They cannot interact with judges and entrepreneurs  For regionals and nationals, teams must have exactly five members. Teams may bring a 6th student to regionals or global finals to act as an observer. 12

Competition Rules  All participants must sign non-disclosure agreements  During the competition, teams are allowed to use any available internet resource or database, whether free or by subscription, as well as any books and other printed materials  After 9am on the day of competition, teams are not allowed to contact any individuals for help (i.e. secondary research is ok; primary is not)  Upon receiving business plans, students must notify the organizers of any familiarity with participating businesses  Students can compete in the regional VCIC only once  Teams may substitute core team members with alternates at any time before the competition begins. However, no substitutes may be made during the on-campus, regional, or global events. 13

Judging Criteria Due Diligence (20 pts) Term Sheet (20 pts) Partner Meeting (20 pts) • Learned what they needed to • Reasons to invest • Demonstrated deep VC know? Covered key knowledge, terms, exit • Reasons not to invest questions? Dug into key strategy, return potential, fund • Overall decision issues? fit, etc. • Valuation, Invest. Size, • Demonstrated deep • Adequately explained deal Syndicate, Fund Fit, Option understanding of the • Handled questions/coaching Pool, etc. business opportunity? • Confident and convincing • Dividends, Board Structure, • Lead/controlled the meeting? • All members contributed • Liquidation Preference, Anti- • Established appropriate dilution, Dates and Other rapport and demonstrated Terms value as a VC firm? • Focused on the key issues • Demonstrated firm's value Negotiations • Tackled tough issues • Note: teams are not judged on Top 2 Teams Only “getting to a deal” • Established positive rapport 14

What Makes a Strong Team?  Diversity!! – Team make-up (1Y, 2Y, E/W) – Backgrounds and areas of expertise  Strong and diverse academic background – Commercializing Innovation – Entrepreneurial Finance course 15

Application  Word application and instructions available on the VCIC website: bit.ly/BoothVCIC  By Wednesday, November 21, 2018 at noon: – Send one electronic copy of the complete application packet to Cerise Miller at cerise.miller@chicagobooth.edu – Deliver the $50 application fee, to Cerise Miller in the Polsky Center (Harper Center Suite 207) 16

Application  Eligibility:  All Booth students eligible  Must have 5 team members committed for  Orientation: Early January, 2019  Booth Competition: Jan 18, 2019 all day  Regional Competition in Boulder, CO: February 8, 2019  Global Finals in Chapel Hill, NC: April 12-13, 2019  Submit resumes  Pitch your team: 5 slides or less (not including cover) 17

Application – Fund Intro (Optional)  Name  Mission  Focus, theme, theses  Size  Vintage  Location  Bite size  Miscellaneous if you want to get specific (GP contribution, etc.) 18

Application – Team  Competitive advantage – what do you bring to the table that’ll uniquely help you win?  Track record related to entrepreneurship, VC  Important abilities not covered on resume (you’ll submit your resumes separately)  Why are you doing this? 19

Application – Strategy/Plan  How will you win?  What’s your plan?  What resources will you draw on?  How will you use each member’s strengths?  How will you mitigate weakness or gaps in your team? 20

Application – Representative Deal  1-2 deals  Pitch a real company you would pursue  Represents what is attractive to you  Can find on Techcrunch, Angelist, personal network  Why pursue/invest?  What are you most concerned about?  No in depth modeling, valuation, or term sheets 21

Questions? • Additional information and application forms for the Chicago Booth VCIC: bit.ly/BoothVCIC • Info on the regional and national VCICs: www.vcic.org • VCIC coordinators: • Nora Mansfield, Polsky Center, nora.mansfield@chicagobooth.edu • Cerise Miller, Polsky Center, cerise.miller@chicagobooth.edu • Meha Patel, EVC co-chair, mpatel30@chicagobooth.edu • VCIC faculty sponsor: • Professor Scott Meadow 22