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Adrenaline Startups

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An Alternate View to Startups

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Page 1: Adrenaline Startups

Adrenaline Startups and Rapid-Fire Marketing

@

www.TandemEntrepreneurs.com

Page 2: Adrenaline Startups

Where is Your Risk?

Private & Confidential

Page 3: Adrenaline Startups

Capital

Conventional Funding Milestones

Risk (ß)

Valuation

Idea is

FeasibleProduct Traction

Seed

Funding

R&D

Capital

Go-to-Market

Captial

Expansion

Captial

$0.5M $3.0M $8.0M $13.5M $150M

Based on slides from

Vinod Khosla

Page 4: Adrenaline Startups

Proven

Team

Proven

Value

Proven

Business

Proven

Channel

A Different Set of Milestones

CustomerValidation

CustomerDiscovery

ProductValidation

PartnerDiscovery

ChannelDiscovery

PartnerValidation

ProductTuning

PricingDiscovery

ChannelScaling

Channel Validation

ProductExpansion

PricingOpt

Page 5: Adrenaline Startups

Today: Market Fit is Cheaper to Explore

Private & Confidential

Build Young Teams, Open Source

Deploy With Low Cap-Ex: The Cloud

Market With Social Distribution/Marketing

10x lower Cost to Establish Adoption

Page 6: Adrenaline Startups

Proven

Team

Proven

Value

Proven

Business

Proven

Channel

Heads I win, Tails I don’t Lose Much

CustomerValidation

CustomerDiscovery

ProductValidation

PartnerDiscovery

ChannelDiscovery

PartnerValidation

ProductTuning

PricingDiscovery

ChannelScaling

Channel Validation

ProductExpansion

PricingOpt

$0.5M $1.5M $20MBurn →

Page 7: Adrenaline Startups

Conventional Venture Capital

Private & Confidential

5 yr returns are negative

Page 8: Adrenaline Startups

What’s Changed : Exits Are Smaller

12%

73%

57%

23%

Data from

100M+

< 30M

Page 9: Adrenaline Startups

Proven

Team

Proven

Value

Proven

Business

Proven

Channel

Model Supports Many Possible Exit

CustomerValidation

CustomerDiscovery

ProductValidation

PartnerDiscovery

ChannelDiscovery

PartnerValidation

ProductTuning

PricingDiscovery

ChannelScaling

Channel Validation

ProductExpansion

PricingOpt

$0.5M $1.5M $20MBurn →

Page 10: Adrenaline Startups

Investment Models Compared

Private & Confidential

Conventional Model

Invest in a 5% chance of creating a few 100M+ Business

Capitalize the business with US $3-5M - A Round

Success = Big Exits and founders make 10’s of millions

New Model

Invest in the likely chance of creating MANY 10M+ Businesses

Capitalize the business with US $500,000 of initial capital

Success = Cash Flow or Exits where founders make millions

Page 11: Adrenaline Startups

Increasing the Probability of Success

• Redefine Success to include Smaller Exits

• Contain the Market Risk Quickly and Cheaply

• Get an A+ Team

Private & Confidential

Page 12: Adrenaline Startups

Tandem Entrepreneurs

Seasoned Entrepreneurs

working in tandem with multiple

Small Founding Teams

applying

Modest Capital

to efficiently build

Simple Highly Leveraged Services

and take companies to

High Probability Exits

Private & Confidential