Q: How does i2X help me?
i2X is an exlusive seed stage investment platform that connects the best technology startups with leading institutional investors. Our investment network includes several of the most renown VC investors in Silicon Valley, the Boston area and New York, as well as a series of "Super Angels" with extensive Silicon Valley experience. If you make it on i2X, your probability of getting funded by a top-notch investor increases dramatically.
Q: How does it work for startups?
To get on i2X, you apply in 60 seconds and go through a three-stage filter process. Stage I is the video application; Stage II is a full registration in that you provide us with a little more information and get officially registered; and Stage III is a Skype interview with an i2X Executive Analyst. In each stage, you have to pass certain criteia we will explain beforehand. For the initial 60 Second Application, you will be assessed on five dimensions: your idea, your team, your traction, your network and your deal (for more details on the five dimensions, please check below).
At i2X, we take entrepreneurs seriously: we want you to become an A-rated startup, and will make sure you get all the information you need to develop yourself into a great investment opportunity.
Q: How do i2X startup filter system work?
It's simple - you and your startup get rated on four dimensions: idea, team, deal, and traction. It's a basic assessment to find out if your idea is both visionary, disruptive and pragmatic; what your burn rate is; if your team understands its users and market; if you are reasonable with your valuation, money sought, and deal template; and what kind of traction or proof of concept you have. It's a lean approach, and takes only 30 minutes in total.
Q: What if I get rejected - will it hurt my reputation? I am concerned!
i2X is designed around the need of entrepreneurs. Having been startup founders and mentors ourselves, we know how important it is to protect your reputation and avoid any negative signaling with investors. That's why we made sure your application will never be able to hurt you in the funding process. Here is why: no one will ever know that you got rated by an i2X analyst, unless you get a top rating and pass the filter. So there is no danger of any negative signaling effects towards investors you talk to, or any of the investors who use i2X. They can only see you if i2X says your are awesome. We make sure the only news that can ever come out of i2X about you is positive.
If you don't pass our filters, only you and your i2X Startup Analyst will know - and he or she will help you work on becoming an A-rated startup by providing you with in-depth feedback.
Q: Is i2X free for startups?
Yes. As a startup, you don't pay anything for being listed, rated or being introduced to investors. While indepdendent third parties might charge you fees for coaching, but they are not allowed to charge for rating you with the i2X rating methodology.
Q: How can I start?
It's very simple: register your startup with i2X now, and we will assign an Startup Analyst who will screen your profile, and will get in touch with you.
Q: How do I successfully complete the 60 Second Startup Challenge?
We designed the 60 Second Challenge for a simple reason: to make maximum use of your and our time. Based on the latest insights into lean startup development, we identified the five central drivers for startup success. You have to tell us four in 15 seconds each, and enter the fifths (the basic deal data) into the application template. Please NEVER talk about the fact you are fundraising or any deal data IN THE VIDEO - SEC regulations don't allow us to use them in that way. If you do, we have to decline your application.
Here is how to do the whole thing right:
Idea: Your idea should be technology-enabled and world-changing. By world, we mean either planet earth, or at least your industry. As a rule of thumb, your idea should have the potential to build a $1bn company within five years (best case). That either means a really powerful business advantage, or something that excites millions of people around the world. In every case, you need to have some kind of scalable technology. It's very rare these days that a startup with the qualities described above is not an internet company in the sense that it somehow leverages the web. If your's has nothing to do with the internet, it better be something big (like: nuclear fusion or a cure for cancer). Costs and efficiency are another issue for non-web companies: mining asteroids might be big business, but it's hard to raise seed stage amounts (below $2m) for it. That's why seed stage investors really like companies that somehow leverage the web.
Team: Your team should have the smarts, skills and commitment to pull off a startup. We know very well that traditional education is not a good indicator for success, but we need something for you. For example, it's always good for a web startup to have a few ex-Googlers on board; or for a biotech startup to have a PhD among it's founders. Most importantly, we need to get the feeling that your team is in its own way absolutely the best for what you want to do. In terms of commitment, even though we love kids, it's better to have founders who can show they can give more than everything over the next few years. If not, you will need some kind of (really) unfair advantage. Like Bill Clinton on the team if you want to do kickstarter for non profits.
Traction: To show traction, we are not looking for the infamous prove of concept (meaning: a running and growing business). If that were the case, you would probably not be a seed stage startup. We are looking for anything that makes you confident you are on the right track. That can be some user growth, initial revenue, a prototype that works awesome, or strategic partners that have signed up or gave clear (and verifiable) signals they are interested in using your product. Partners can also include powerful mentors who like you and will support you.
Network: This dimension is pretty unique to the i2X filters methodology, and a result of our personal experiences with startup success. Being part of a startup network has been proven to be an extremely important part of your success. Because many things you have to do and learn are not specific to your company, but to building a technology startup in general. The tighter your network with other entrepreneurs, mentors, investors and experts, the faster you will learn and iterate. This is why we require every startup on i2X to be part of at least one qualified network. Networks can be startup networks like Hackers & Founders, meetups like Startup Grind, any Incubator or Accelerator (Y-Combinator, TechStars, Kicklabs etc.) and even co-working spaces such as WeWork or General Assemb.ly. You can read more about the i2X network partners here. If you are part of a network that is not respresented yet, please tell their organizers to register with i2X. It's free and takes less than 60 seconds - the link can be found on the main page.
Seeking & Valuation: You are responsible for telling investors how much money you look for, and what your valuation is. i2X changes the rules of the game a little by giving entrepreneurs more power in negotations and letting you set your initial valuation (or cap in terms of a convertible note). So, if you need $100k and want to give up 10% in equity in return, you seek $100k at a $1m valuation. Here are some rules how to be a "good deal":
- Your "Seeking" amount should never exceed $2m.
- If you are not sure what the right amount to raise is, plan for 12 months and be as frugal as possible. We need to see that you can put money to work efficiently. Set yourself a clear business development goal that significantly increases your company value withing less than 12 months, and figure out what the leanest (=cheapest) way is to get there - that's your amount.
- Typical amounts range from $50k-$500k. Everything beyond that puts you on a serious due diligence radar.
- Consider that as a seed stage startup, your mission is not to build facebook or Apple, but to reach the next significant milestone in the shortest, leanest way possible to raise your company value (and valuation), and raise the next round. The leaner you are, the less money you need, the less equity you have to give up, and the happier your investors are.
- i2X required you to set your own valuation (or cap, in terms of a convertible note). With i2X, we give more powers to entrepreneurs, but require you to use these powers wisely. It's a marketplace: a high valuation might look good for you initially, but less investors will be interested. There is also a lot of talk from angel investors, especially in Silicon Valley, that valuations don't matter. This is definitely not the case on i2X. Our investors are professionals who build large portfolios and need high returns on initial investments - a $8m valuation delivers exactly half the returns of a $4m valuation, and that's significant.
- Typical valuations range from $1m (idea with a strong team, but very little traction and a mediocre network) to $10m (idea, team, traction and network are outstanding - good Y-combinator companies get here frequently). In our experience, most startups fall in the $2m-$5m range. To go beyond $5m, you need some pretty heavy guns on board.
If you follow these guidelines and have something awesome, you should easily pass the 60 Second Challenge.
If you are not sure if you are ready, you can always shoot us an email with your questions - i2X is here to help startups and boost innovation. Giving feedback to aspiring entrepreneurs is part of our job. Write us at firstname.lastname@example.org.
Still a question that didn't get answered? Sorry!
Please write us at startups@i2X.co