Finding the next Waze:

An insider view of startup investing and due diligence

Breaking down the Waze investment: From startup to $ billion exit Creating a winning investment checklist How to conduct professional due-diligence

Tuesday, July 30, 13

Meet OurCrowds Team

David Stark, OurCrowd Investment Associate Zack Miller, OurCrowd Head of Investor Community

OurCrowd: 7 months since launch, OurCrowd has invested $17M in 26 startups

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Waze/Google Deal

>$1 billion team gets to stay in Israel Israel and the consumer web

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The investment case for Israel

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The investment case for Israel

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Special Guest: Gadi Mazor OurCrowd General Partner/CTO

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Waze: Anatomy of a super investment

2008
BlueRun leads $12M round, Magma and Vertex join

2010
M 2 . 2

rs e us

2011
7M

rs e us

2013

Same investors $30M round inc Qualcomm Kleiner Perkins, Ventures: $25M $200+M round, $95M valuation valuation

Google buys Waze app for $1.1 billion

Our bet was basically that they could disrupt old-fashioned cartography, and that they were at just the right time to begin trying it. -- BlueRuns John Malloy

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Well also work closely with the vibrant Waze community, who are the DNA
of this app, to ensure they have whats needed to grow and prosper. The Waze community and its dedicated team have created a great source of timely road corrections and updates. We welcome them to Google and look forward to working with them in our ongoing effort to make a comprehensive, accurate and useful map of the world.
Posted by Brian McClendon,Vice President, Google
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Where to nd the next Waze (or, how do I invest in the next $billion exit)??
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Building deal ow pipeline

Sources of dealow

web, email, referrals tech events

Resources: TechAviv, Garage Geeks, incubator demo days

proactive sourcing

Jeff Pulvers Twitter investment (just a Tweet away)

Resources: OurCrowd, AngelList, CrunchBase, blogs/articles

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Initial screening process

Elevator Pitch

(big) * (idea, market, team)

disruptive idea market > $500M team = serial

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Coffee Chat with Founder(s)

Blink theory: experience breeds good intuition

Pitch Deck

In-depth diligence

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Follow-up meetings with management Research: biz plan, competition, industry trends/forecasts, intellectual property, nancial projections, HR Customer/strategic partner interviews (see handout) Industry experts/mentors
Resource: DIY Expert Networks (see Quora, Laughing at Wall Street)

Scorecarding (see handout)

Legal negotiation/diligence
Term sheets
Valuation Common vs. Preferred Important rights and protections Resource: Passion Capital Plain English Term Sheet,
Founders Fund Transparent Term Sheet

legal diligence, nal review...

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The morning after... from investor to mentor

Can I add value?

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customers/partners/ hires/investors

perfect balance annoying <--> helping aligned expectations

How will OurCrowd identify the next Waze?

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...the 6 point investment checklist

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So, how does Waze score?

1. Great team 2. Large market

3. Easy to understand 4. Traction 5. Sponsorship 6. A good deal

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#1: Great team

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Case Stud Squa y: AE reds grea t tea m

AE-Squared
founders have sold 3 companies between the two of them

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#2: Large market

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Case Stud Fireb y: lade dolla s billio r ma n rket

Fireblade
multibillion dollar market of website security anti-bots, anti-scraping

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#3: Easy to understand

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Case Mark Study: A bes et is unde easy to rstan d

Abes Market
Amazon for green products

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#4: Traction

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Case

Stud tract y: Kelas ion

Kela
Existing customers include Fortune 100 + top hedge funds large pipeline 250% revenue growth YoY

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#5: Sponsorship

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Case Stud spon y: Argo sors hip s

Argo/ReWalk
top Israeli venture capital investors (Pontifax, Israel HealthCare Ventures, SCP Vitalife)

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#6: Good deal

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Case early Study: P arko stage valua s tion

Parko
investment made at good valuation

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Summary

Waze exemplies a new type of Israeli startup

Conduit, Wix, Mobileye, GetTaxi

Finding quality angel investments requires a formal process OurCrowd is helping make investing in startups easier and accessible

Now, for accredited investors and hopefully in the near

future, open to all investors

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Any questions?
Zack Miller, Head of Investor Community email: zack@ourcrowd.com phone: +1.914.401.6422

Tuesday, July 30, 13

Accredited investor?
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Tuesday, July 30, 13