Raising Venture Capital

RUPERT PEARCE joined Inmarsat in 2005 as Group General Counsel. Inmarsat is the world’s leading mobile satellite communications provider and recently underwent a $1,500 million leveraged buy-out by Apax and Permira and subsequent $3,000 million IPO on the London Stock Exchange. Inmarsat is now well-established in the FTSE 250. Prior to joining Inmarsat, Rupert was a General Partner at Atlas Venture, the leading transatlantic venture firm, responsible for corporate finance, mergers & acquisitions and special situations. He also served as Atlas Venture’s European COO. Prior to Atlas Venture, Rupert was a partner at the international law firm Linklaters, specializing in corporate finance, mergers & acquisitions, technology and private equity. Rupert has therefore experienced private equity and venture capital transactions from the perspectives of investor, adviser and member of management. As a founder of Out-Take Limited, an on-line publisher, he has also dabbled in entrepreneurship.Rupert holds a First Class MA in Modern History from Oxford University and won the 1995 Fullbright Fellowship in US Securities Laws, studying at Georgetown Law Centre, Washington DC. SIMON BARNES is Director of the Entrepreneurship Centre, and Deputy Director of the Full Time MBA programme at the Tanaka Business School, Imperial College London. He teaches electives in new venture creation and venture capital finance on the MBA, MSc Finance and MSc Health Management as well as courses for the faculty of Imperial College’s science and technology departments. His research at Imperial focuses on technology entrepreneurship and venture capital, with an emphasis on the development of university spin outs and technology ventures. Simon has six years of hands on experience in the venture capital industry, first with the transatlantic firm Atlas Venture and most recently with GIMV Venture Capital where he invested in early stage biotechnology companies. He has been a board director of several VC backed ventures, and lived through two M&A transactions at board level.Simon received a first class honours degree and a PhD from The University of Cambridge. He holds an MBA with Distinction from the Tanaka Business School, Imperial College London, and was the winner of the European MBA Business Plan of the Year Competition in 1998.

• Preface xiiiPart I The Business of Venture Capital 11 Entrepreneurs and Venture Capitalists 32 Other People’s Money 93 The Limited Partnership 154 The Competitive Environment 255 The VC's Investment Model 31Part II Accessing Venture Capital 496 Introduction to Part II 517 Is Venture Capital the Right Option? 538 Choosing a VC Firm 599 The Entry Point 6510 The Investment Process 7111 Preparing for the Investment Process 81Part III The VC Term Sheet 9912 Introduction to Term Sheets 10113 Business Valuation 12114 Investment Structure 12315 Syndication 12516 Investment Milestones 12917 Corporate Governance 13918 Equity Participation 14719 Share Incentives 16920 Share Vesting 17521 Pre-emption Rights on Securities Issues 18522 Anti-dilution Rights 19123 Provisions Relating to Share Transfers 20324 Deal Management Terms 219Index 229