The Mock Angel Program is an intensive program to prepare ventures for serious investor consideration. To be accepted into the program a company must complete a Business Model Validation; once accepted, the entrepreneur gives a presentation to a Mock Angel panel, which consists of investors, entrepreneurs and subject matter experts. The panel responds to the presentation as a group of investors might with probing questions on the following areas of consideration:
- Problem/Opportunity: What problem are you solving and for whom? What’s wrong with how the problem is addressed right now? How big is the need? How bad is the “hurt?”
- Compelling Solution: How is your solution compelling compared to current methods of solving the problem? What’s unique and special about your solution?
- Competition Analysis: Who are the incumbent providers? Who are other new players? Who has market share? How are you differentiated from the older and newer players? Why will you win against the competitors?
- Revenue Model: Who are your customers? What is it that you’re selling to them? How do they pay: once, recurring, subscription, etc.? How much do they pay?
- Marketing Plan and Strategy: How do you reach your customers? How do they know about you and your product/solution/service? How do you engage customers in your product development? How do you determine you pricing?
- Sales Strategy: Web-based sales? Building a sales team? How have you acquired your first customers? Will you acquire future customers in the same way?
- Management Team and Plan: Why is your team the one that will create success? What strengths and deficiencies are in your management team? How are you addressing the deficiencies? Who have you identified that will join the company as soon as you get funded?
- Technology/Scalability: How much work remains to get your product/service complete and ready for fast scaling? What roadblocks are in your way? What technical challenges are yet to be overcome? How will you overcome them?
- Delivery/Customer Enrollment and Service: Do you have supply chain challenges? How do you keep your customers happy? What happens if you acquire 100x or 1000x more customers than you anticipate? How will you scale the business and not cause service/product deficiencies?
- IP/Legal Issues: What law firm are you using? Can your “secret sauce” be protected? Are patents filed or issued? What unique legal issues are involved with your venture?
- Financial Projections and Funding Plan: How much has already been invested? How much do you need now and what will the money be used for? How much will you need in the future and for what? What will the future revenues and costs be? How many current investors are they and how difficult will it be to get a new funding structure approved?
- Current Deal Being Offered: How much of the company is being offered? What is the capitalization table after funding? What is the pre-money valuation and how do you justify it?
- Exit Strategy: How will investors realize their investment multiples? Who are likely acquirers? What are prior exit comparable and what were their return multiples? How many years until you exit?
- Presentation Skills: Do the charts tell the story well and compliment the verbal pitch? Is it a clear and concise presentation showing a high level of credibility and knowledge about the business and space? Is your verbal style neither too passive nor too aggressive and do you exude confidence and commitment to the venture?
- Receptivity to Mentoring: Are you open to constructive criticism and “tough love” challenges to your assumptions and strategies? Are you willing to hear other points of view and learn from what is suggested? Do you take challenges openly and seriously, or defensively? Are you actively seeking guidance from the Mock Angel mentors who offer their help?
The entrepreneur is provided extensive feedback and then works collaboratively with panel members to address areas where improvement is needed. Once the deficiencies have been addressed and the company successfully re-presents their investment opportunity, the panel votes on whether the business meets their graduation criteria.
Graduation means it is the opinion of the ITEN Mock Angels that the company has addressed all the big questions and have thought through their business well enough to ask for other people’s money. They have presented their value proposition effectively and have addressed issues raised in a convincing manner. They have worked intensively with ITEN mentors to prepare their company’s investor presentations. The consensus among the Mock Angels is that these companies are adequately prepared to present their companies effectively to prospective investors.