2009 Headlines
Johnson School Students Place Second in Northeast Venture Capital Investment Competition
Team performed due-diligence on three real businesses, negotiated with entrepreneur on a term sheet, and led the pack in the question and answer session with judges
March 24, 2009 | Ithaca, NY | A Johnson School team fielded by BR Ventures and comprised of MBA students Matthew Dacey (MBA '09), Alvin Lin (AMBA '09), Saif Ajani (MBA '09), Roy Ashok (MBA '09) and Alok Verma (MBA '09) took second place and a $1,000 prize at the 12th Annual Northeast region of the University of North Carolina's Venture Capital Investment Competition (VCIC). The teams were judged by a group of ten venture capitalists.
The Northeast competition, hosted at New York University's Stern School of Business, pitted teams from six top business schools from the U.S. and abroad against each other. Unlike business plan competitions, in which students pitch their own ideas to investors, VCIC allows students to act as the investors, with real entrepreneurs pitching to them. This year's competition featured three start-up businesses looking for an investment. MIT's Sloan School of Management took the top prize, while the University of Virginia's Darden School bagged the entrepreneur's choice award. Regional winners go on to compete at the finals at the University of North Carolina on April 16-18 in Chapel Hill, NC.
Over the course of the two-and-a-half day event, the teams received business plans and performed due-diligence to assess the pros and cons of each business. The entrepreneurs pitch their plans to the student VCs and then field questions from the student competitors. After meeting with all the entrepreneurs, each team decides which of the three businesses to invest in, and prepares an appropriate term sheet. The teams then negotiate the terms with the entrepreneur, while a panel of professional venture capital judges observes from the periphery.
Following this, the tables are turned and the students must defend their investment thesis and convince their "partners," the judges. In a session that can feel like a lifetime to students, the judges pepper them with questions, digging deep into the team's decisions and cutting to the point in their reputed no-nonsense style. Finally, judges must choose a winner — the team they would most like to have as their VC partner based on their evaluation of the teams' assessment of risk, knowledge of the process, communication skills, and teamwork.
The Johnson School team was enthusiastic before the competition, though extremely sleep deprived from a long night of making models and tables. The team delivered a thorough investment thesis and term sheet, and felt confident in their performance during the negotiation and question and answer period with the judges.
The judges and entrepreneurs were pleased with the team's efforts. "I really enjoyed negotiating with you guys and liked your approach to trying to close the deal," mentioned an entrepreneur to Alok Verma.
"Bottom line," says Alvin Lin, "I'm very proud of our performance. We came in to win, we and several judges thought we did, and we gave it our all."
"Professor Ola Bengtsson really helped us prepare by negotiating with us—both as a novice and as an experienced entrepreneur," mentions Roy Ashok. "The support and tips we received from Professor Zach Shulman and previous participants from the Johnson School helped us shine through the negotiations and Q&A," remembers Matt Dacey. While it was a valuable experience for the team, they also hope that their work helps set up Johnson School teams for future venture capital investment competition and social venture capital investment competition tournaments.
Participating schools in the VCIC Northeast region were Cornell (Johnson), MIT (Sloan), Virginia (Darden), Columbia Business School, London Business School, and Yale School of Management.
For more information on the competition, log onto http://www.vcic.unc.edu/
