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Angel Investing—May 2001 Session

Agenda

DAY 1
8:30 AM WELCOME AND INTRODUCTION
David Brophy
8:45 AM WHAT IS ANGEL INVESTING AND HOW IS IT DONE? THE VIEW FROM THE TRENCHES
Panel: David Brophy (Moderator)
Panelists: Hans Severiens, Managing Director
The Band of Angels- Palo Alto, CA

Bob Bozeman, General Partner
Silicon Valley Angels- San Francisco, CA

Professor Tom Kinnear, Director
Samuel Zell and Robert H. Lurie Institute for Entrepreneurial Studies
University of Michigan Business School
10:15 AM *** BREAK ***
10:30 AM THE VENTURE CAPITAL MARKET
Panel: David Brophy (Moderator)
Panelists: David Arscott, Managing Partner
Compass Technology Partners- Palo Alto, CA

Ian R. N. Bund, Managing Partner
WhitePines Ventures LLC- Ann Arbor, MI
12:00 PM LUNCHEON
Executive Residence Dining Room
1:00 PM ENTREPRENEURIAL FINANCE: WHAT THE EMERGING, TECHNOLOGY-BASED GROWTH-ORIENTED COMPANY FACES TODAY

Joint Presentations:

"Understanding The Linkage Between the Business Model,
The Financial Engine and the Harvest"
David Brophy and Bob Bozeman

"Valuation in the Real World: Practical Aspects of Valuation Negotiation"
Hans Severiens and Tom Kinnear

"Deal Structuring and Pricing: The Nature of Capital Structure, Securities and Investment Agreements"
David Arscott and Ian Bund
3:00 PM HANDS-ON CHALLENGE:
GROUP ANALYSIS OF "JUST TALK, INC.",
AN EARLY STAGE COMPANY SEEKING ANGEL FUNDING

Dick Beedon, CEO of Just Talk, will make a 15 minute "deal pitch" presentation to participants based upon information provided to Seminar participants in advance. A 10 minute "clarification" Q&A period will follow and then participants will assemble in break-out space into investment groups, with each group mentored by a Seminar Faculty member. Each group's objective is to make a decision on investing in Just Talk and to construct an offer sheet/term sheet to present to Dick. A UMBS student will be provided to each group for analytical work and report assembly.
5:00 PM PRESENTATIONS BY EACH GROUP AND RESPONSES FROM DICK BEEDON AND JUST TALK, INC. TEAM
7:00 PM RECEPTION AND DINNER
Executive Residence Dining Room
DAY 2
8:00 AM EFFECTIVE DUE DILIGENCE INVESTIGATION
Panel: David Brophy (Moderator)
Panelists: David Arscott, Managing Partner
Compass Technology Partners- Palo Alto, CA

Ian R. N. Bund, Managing Partner
WhitePines Ventures -Ann Arbor, MI
9:30 AM MONITORING AND VALUE CREATION
Panel: David Brophy (Moderator)
Panelists: Bob Bozeman
Angel Investors LP- San Francisco, CA

Professor Tom Kinnear
Samuel Zell and Robert H. Lurie Institute for Entrepreneurial Studies
University of Michigan Business School
10:15 AM *** BREAK ***
10:30 AM DEAL-MAKING IN ANGEL, VENTURE CAPITAL AND HARVESTING TRANSACTIONS
Panel: David Brophy (Moderator)
Panelists: William Weaver, Partner
Sachnoff & Weaver- Chicago, IL
12:00 AM LUNCHEON
Executive Residence Dining Room
1:00 PM DOWNSTREAM FINANCING: "DEALING WITH VENTURE CAPITAL FUNDS, STRATEGIC CORPORATE INVESTORS AND INVESTMENT BANKERS IN SUBSEQUENT ROUNDS OF FINANCINGAND IN HARVESTING"
Panel: David Brophy (Moderator)
Panelists: Hans Severiens, Band of Angels

Bob Bozeman, Silicon Valley Angels

Prof. Tom Kinnear- Director,
Samuel Zell and Robert H. Lurie Institute for Entrepreneurial Studies,
University of Michigan Business School


David Arscott, Managing Partner,
Compass Technology Partners- Palo Alto, CA

Ian R. N. Bund, Managing Partner,
WhitePines Ventures- Ann Arbor, MI
3:00 PM *** BREAK ***
3:15 PM SPECIAL TOPICS, IN RESPONSE TO PARTICIPANT SURVEY CONCENSUS DEMAND, TO BE ADDRESSED BY SEMINAR FACULTY IN OPEN FORUM
5:00 PM SEMINAR CONCLUDES WITH A RECEPTION FOR PARTICIPANTS AND MEMBERS OF THE "MICHIGAN ANGELS FORUM" FOLLOWED BY DINNER
Phelps Lounge- University of Michigan Business School

Seminar Faculty

BOB BOZEMAN
General Partner, Angel Investors, L.P.
San Francisco, CA.

Mr. Bozeman has 24 years of management experience in high-technology enterprises. He has ser ved 12 years as CEO/President or General Manager in software, information technology/services and computer supplier industries (including Vetronix Sales Corporation, Altos Computer Systems, and Natural Language Incorporated). He served as an officer at a Fortune 100 Corporation contributing to growth in revenue from $50 million to $2.7 billion (Wang Laboratories). He is the founder of two successful high-tech businesses (Library Systems and Bozemans', Inc.) He led the turnaround restructuring for a company with five years of losses into a profitable business (Fortune Systems). Mr. Bozeman graduated with a BS in Accounting from University of Cincinnati. He also received a BS combined degree of Management and Arts & Science from Northeastern University.

Angel Investors, L.P. is one of Silicon Valley's premiere Angel Investor groups. Angel Investors, L.P. provides capital investments to early stage companies focused on the internet, e-commerce and information technology markets in the San Francisco Bay Area.

IAN BUND
President, White Pines Ventures, LLC
Ann Arbor, MI.

Ian R. N. Bund, President, has been involved in venture capital and private equity investing since 1969. In addi-tion to White Pines Ventures, he has participated in the successful development of several other private equity f irms: Research & Science Investors; Doan Associates; The Michigan Investment Fund; and MBW Venture Partners. In 1999, he co-founded Innovation Capital, a provider of venture capital to early-stage Australian technology companies.

Ian has accumulated a broad background in the venture capital industry having invested in more than 300 com-panies. These investments comprised a wide range of industries including biotechnology, healthcare, informa-tion, telecommunications, and computers. Prior to entering the private equity industry, he gained investment banking experience at Morgan Stanley and turnaround management skills as President of Sea Life, Inc., an oceanarium. Ian began his career in audit, tax, and business advisory services at Price Waterhouse & Co., Sydney, Australia.

Ian received a B.Ec. from the University of Sydney (Australia) and an M.B.A. from the Harvard Graduate School of Business Administration. He is an Australian Chartered Accountant.

TOM KINNEAR
Professor of Entrepreneurial Studies
Executive Director of the Samuel Zell and Robert H. Lurie Institute for Entrepreneurial Studies, University of Michigan Business School

Thomas C. Kinnear is the Eugene Applebaum Professor of Entrepreneurial Studies, Executive Director of the Samuel Zell and Robert H. Lurie Institute for Entrepreneurial Studies, and Professor of Marketing at the University of Michigan Business School. He is the former editor of the Journal of Marketing and the Journal of Public Policy & Marketing. He is co-author of several books including: Principles of Marketing, Marketing Research: An Applied Approach, Promotional Strategy, and Cases in Marketing Management. Professor Kinnear has worked in consulting for firms such as: Aetna, AT&T, Alcatel, Chrysler, Domino's Pizza, Inc., Eli Lilly, Ford, General Motors, General Electric, Helmac Products, Kodak, L'Air Liquide (France), and Travelers. He also has served or is serving as a member of the Board of Directors or Corporate Advisory Boards for sev-eral companies and community organizations including: Avail Networks, Inc., Bard Manufacturing, Inc., Beautiful Island.Com, BlueGill Technologies, Inc., Copernicus, Inc., Domino's Pizza, Inc., Greenhills School, Helmac Products, Inc., Interpretive Software, Inc., and Network Express, Inc. In 1990, he co-founded and served as a director of Network Express, an early competitor in the ISDN market. It was sold in 1995 for $110 million to Cabletron Systems. In 1996, he co-founded and served as a director of Bluegill Technologies, the pioneer in bill and document presentment on the Internet. It was sold in 2000 for $250 million to Checkfree Holdings Corporation. In 1999, he co-founded and is serving as a director of Avail Networks, a DSL hardware and software provider, and of Beaufiful Island.com, an ISP targeted at seniors. He holds an undergraduate degree from Queen's University at Kingston, Ontario, an MBA from Harvard University, and a Ph.D. in Business Administration from the University of Michigan.

HANS SEVERIENS, PH.D.
Managing Director, Band of Angels
Palo Alto, CA.

Hans Severiens has been an officer in three venture capital funds: the seed stage fund, Bay Ventures; the late stage MIP Equity Fund; and the current Band of Angels Fund, L.P.. Prior to 1983, he was a Vice President in investment banking with Morgan Stanley Dean Witter, Merrill Lynch, and Paine Webber. Hans has a Ph.D. degree in nuclear physics from Johns Hopkins and a B.A.degree in physics from Harvard College. He has served as Assistant Chief Scientist at Perkin-Elmer, Research Professor at Columbia University, and Staff Scientist at the Atomic Energy Commission. He is on the Board of Directors of two closely held companies.

The Band of Angels Fund, L.P. is a $50M venture fund comprised exclusively of institutional partners including three corporations, two university endowments, and a large pension fund. The fund includes portfolio compa-nies such as: Interactive Silicon Inc., Genitope Corporation and Dynaptics. The Fund co-invests exclusively in deals that are subscribed by members of the Band of Angels and provides institutional support to these deals via bridge and follow-on financing be yond the Series A round.

DAVID G ARSCOTT
Co-founder and Partner, Compass Technology Partners
Menlo Park, CA.

David G. Arscott is a Managing Director of Compass Technology Group. He is also a Director of Lam Research and was an original investor in that company, now a leading provider of semiconductor capi-tal equipment. In addition, he is a director of Silicon Valley Research, a semiconductor design firm and CyberState University, an elearning company focused on information technology training delivered over the Internet. Compass manages funds emphasizing investments in emerging public and private electronics-based technology companies. The firm focuses its private investing efforts on start-up situations. The public equity emphasis is on companies with market capitalizations ranging up to $ 1.5 billion. He is a periodic speaker on the issues surrounding the formation and building of technology companies. He has been active in industry affairs and is a past president of the Western Association of Venture Capitalists. He earned a BA from the College of Wooster (History and Economics) and an MBA from the University of Michigan (Finance and Accounting). His wife Martha and he have been married 20 years and have four boys.

Compass Technology Partners invests in emerging, high-growth potential, public and private companies with a focus on science and technology, innovation and intellectual property.

 
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