Bortnik Fund - “easy money” for the good or the detriment

Each startup chooses a development path: personal investments, investors or funds. Each has its pros and cons. Our company receives the third grant. And I want to share my personal experience, how difficult it is and what to do about it.
The story began with the idea of ​​the “Online Video Editor” project. A team from a group of geeks, developers and one sensible manager gathered. Nobody had money for the project. The lending option did not suit us, because no one then had guarantees that the project would take off, and there was nothing left to bail. There were still options: investors and funds. And to reach the first and second to reach out “from scratch” is not an easy task. We tried both options. Nevertheless, the option with the fund turned out to be working for us.

In 2009, the Fund for the Promotion of the Development of Small Forms of Enterprises in the Scientific and Technical Field, also called the Bortnik Foundation in honor of its founder, Ivan Mikhailovich Bortnik, held a competition jointly with Microsoft. It was called Microsoft Business Start. We have submitted an application. For a group of developers and one manager, who at that time, although had some experience in managing the company, filling out an application is a separate saga. But we went through the qualifying round, were admitted to full-time defense, but at this stage the project was “slaughtered”.


The fact is that in the qualifying round only formal features are taken into account. To go through it, you need to carefully fill out all the fields, indicate all the digits before the comma, attach all the documents. But on the face-to-face defense, where 8 experts are present, they ask “deep” questions about the project.

Each expert evaluates the project according to the criteria:

• Scientific and technical part of the project. It is important here to justify the need for development, to prove scientific novelty, to present the results of patent searches, to show scientific and technical risks, to prove the competence of developers.
• Commercialization. We need to try to convince experts why a scientific and technical idea can become a business: present a commercialization strategy, compare competitors and their business models, show the results of market analysis with an idea of ​​who the consumer will be and why he needs it. Ideally, you need to provide evidence in the form of the results of surveys or letters of support - they are especially appreciated.
• Action Plan for the implementation of the project. Here, of course, it is assessed how thoroughly you have worked out an action plan, starting from development and ending with the protection of intellectual property rights.
• Development plan. How realistic are your ideas, what do you expect from a project after 1,2,3 years of existence, how much do you plan to earn on it, how realistic are the payback periods, is the level of wages justified, etc.
• Command. Well, here it is clear - what are the competencies, work experience and merits of all team members. If you can surprise the experts, you are great! Because usually in this section everyone remembers not only real work experience, but also diplomas for the Olympics from high school.

In general, we did not pass this test. We had the main comments: inadequate financial model, exaggerated market size, and fuzzy product positioning - we could not explain who the consumer would be, how many there were and why they needed it. And we also did not provide confirmations from investors or potential users.

SMART ASS. and U.M.N.I.K. on your marks

But we did not stop there, participated in other events, while developing the product. And in the summer of 2009 they won, but in a different competition from the same fund: the competition of U.M.N.I.K. 400 thousand rubles for 2 years. Actually, this is a scholarship that is paid to one student, but we put this money into the project into a common boiler. If you are not a student, you can also participate in this competition, the main thing is that there is a scientific adviser and not necessarily from a university, he may be an employee of any company.
But under this program we worked only 1 year, i.e. received a total of 200 thousand. In 2010, we went to Seliger, defended the project and won the competition “UMNIK on START”, under which the fund finances the project in the amount of 1 million rubles. for one year. The winners were announced in July, after that there was a procedure for drawing up a state contract. The first tranche in the amount of 250 TR entered the company's account in January 2011. It is easier to enter the START program gradually: first WISE, then WISE to START. For those who did not participate in UMNIK there is another program - START . You can apply directly to it, bypassing the contest UMNIK. The result is the same: 1 million per year.
At the end of 2011, we submitted a final report on the first year of the program. All reports were delivered on time, so all tranches arrived on time. The lag between the sending of the report and receipt on the account is about 15-20 days.
The fund is a state structure, so the main thing is that everything should be accurate in the reports, to the point. And in fin. the report should take into account every penny, and the final report should converge at 0. Otherwise, they ask a lot of questions. Fortunately, in the budget for the project, the main cost item for IT employees is salary, here you can adjust the balances.
If we talk about the amount of funding, then it seems big. In fact, it turns out something like this: 1 million = 83,300 rubles. per month, of which 25,445 are taxes. Those. only 57 855 rubles remain for wages. Those. 2 good or 3 small wages. Moreover, in order to have a reduced tax rate for IT companies, you need to have OKVED 72.20. Software development and consulting in this area and accredited to Rosinformtekhnologii.
There is also a restriction on where you can spend the money received. This is targeted funding for R&D. We spend on the development (salary) and rental of premises. For marketing and promotion, for example, you can’t spend them.
For the first year of the program, we developed the first version of the new mobile application for Android and put it on Google Play.

START

Now we have moved to the 2nd year of the START program, under which the fund finances in the amount of 2 million rubles. for a year. For passing in the 2nd year, it was necessary to choose a development option: investment or self-development. Self-development suggested that we should have an annual turnover more than the attracted amount 4 times, i.e. 8 million rubles We do not have such resources, so we chose to attract an investor. We concluded a contract with an investor - 50% of it, 50% of the fund, and passed in the 2nd year under the program.
All reporting is conducted in an online system, which is called straightforward - FUND. It records data for the reporting period and then prints out, signs the head. The electronic report is transferred to the status of “For approval”, and a paper copy is sent to the office of the fund. The system is quite convenient. Over the years, evolved. They say it was hard to work with her before.

TOTAL

You can work with the Bortnik fund. You can get support for the project. It will be possible to feed a team of 2-3 people in the first year and 4-5 in the second (there is still the third year of the program: 3 million per year). There is one point that spoils the rainbow picture: if you have some kind of non-standard situation with documents and formalism, for example, one of the team members is a citizen of another country, and you need to resolve the issue, then you won’t be able to reach a decision by calling the fund. At each step to the side you need to write a letter in the name of the gene. Director of the fund, which delays the deadlines.
And in general, fund money can be borrowed if you understand that this is only help that will end. If you understand that you need to enter the market. The purpose of the fund is to help your company get on its feet and reach self-sufficiency. There is a danger of "getting hooked" on numerous funds - to travel around the country and ask everyone for money, while you need to focus on the market and the products or services sold. At first, we suffered from this misunderstanding and relied on "easy financing." The foundation will help one to stand on one's feet, and the others will relax, and when funding is over, there is a danger of drowning. Among friends there are such cases. The general attitude to the issue of raising capital is clearly described in the book "Startup" by Guy Kawasaki .
Bortnik Fund is a good help at the start, but be careful with money that came to you not from the market. Develop the product that the market needs, and then the money will find you.