HOW DOES SWAN HELP EARLY STAGE VENTURES?
Swan works closely with the start-up ecosystem across India to help build successful ventures.
We work hand-in-hand with select start-ups to:
- Understand the start-up story and business model - The ideas, vision, product design, team, innovation, market, revenue model etc.
- Mentor / guide Start-up Founders on every aspect of business, right from basics to helping solve more complex problems
- Provide reality-checks. Almost all the start-ups have something great, but many things lacking - which they may, or may not recognize. We help them identify the gaps and help close them. Many of these gaps can be fatal
- Access top domain experts. Our network is wide and deep, spanning various industries and consists of industry leaders - people who have made it. We can tap their expertise in helping get the right feedback and inputs for our start-ups
- Get ready for fund-raise. Most start-ups are just not ready to secure funding. Start-ups need to have many basics in place before going for Angel or VC funding. In addition to the business, product and proof-of-concept, this includes legal structure, financial structure, right legal entity for the venture etc. We also help write the presentation, prepare the financial forecasts and other documents required for Fund-raise
- Fund-raise. We share the start-up presentations with various investors, invite expression of interest, conduct follow-up meetings with Founders, structure the investment deal, draft term sheets, comment & put across our views on other legal documents and get the investment concluded.
Costs Involved for Start-ups:
We understand that availability of funds is a major constraint for Start-ups. Our vision has always been to partner with Start-ups over a longer period of time and help them grow into successful companies. Keeping this preamble in mind, we have structured our fee on a success based model- so there's no downside / upfront costs involved.
Here is the Financial Arrangement structure between Start-ups and Swan Finance:
Comprehensive Start-up Mentoring (CSM) (from points 1 to 5 above)
- For those start-ups who are looking for a closer association of mentoring and hand-holding, we take a nominal % equity in the company depending on nature of business and stage of the company
Fund-Raise only (point 6 mentioned above)
|Fund Raised (INR.)||% to Swan|
|Upto 1 Cr.||3 %|
|1 Cr. - 2.5 Cr.||2 %|
|2.5 Cr. - 10 Cr.||1.5 %|
|10 Cr. and above||1 %|
The tiered % is on incremental basis.
Engagement Period & Exclusivity:
The Engagement Period would be 12 months from the date of acceptance by Swan and Start-up, and any applicable Exclusivity would be valid till 1 year after the conclusion of this Period.
Fund-raise by Swan Angel Network members would remain Exclusive with Swan.
A Start-up might also seek Swan’s help for Fund-raise by outside Network investors. In such case all Fund-raise would be Exclusively via Swan.
In case the Start-up is engaging with Swan via Comprehensive Startup Mentoring (CSM) program, all Fund-raise would be Exclusively via Swan (whether from within Network or outside).
- During deal conclusion, start-ups might have to pay for legal and financial due-diligence required by investors
- Swan team would always first take the deal to Swan Angel Network (SAN) members. We'll reach-out to a larger group only if SAN does not fulfil the Start-up fund-raise needs after a time-period of 30 working Days since issuing the term sheet.
- The quantum of fund-raise is technically called as GTV - Gross Transaction Value. It includes - besides liquid money invested - value of any other mechanism of investing in the start-up.
- Tiered fee % on incremental basis means - for example, that for a fund-raise of Rs. 1.75 Crores, fee would be (for first Rs. 1 Crores, 3L plus for next Rs. 0.75 Crore, 0.75*2%=1.5L; total 4.5L)
- The Start-up agrees and allows Swan Finance to share the information pertaining to the Start-up to any individual for the sole purpose mentioned above.
- Swan Finance will introduce the start-up to numerous individuals for fund raising. As part of good faith, Start-up agrees not to approach any individual without the knowledge and consent of Swan Finance representative.