Arthur M. Blank Center for Entrepreneurship
Babson Park, MA
The late spring of 2002 had been a maddening period for Vayusa founder Ajay
Bam. Here he had a unique idea (confirmed by a high-profile technology grant and a host of exceptional advisors), a leading venture capital firm seventy-five percent sold, a talented software developer ready to go, and keen interest from a number of key players in the electronic payments industry. Vayusa had seemed at once to have it all, and nothing whatsoever. Ajay knew that unless he was able to secure a substantial start-up investment, and soon, he would be forced to give up the fight and grudgingly …show more content…
Ajay explained with a sly smile that the multinational underwriter was having some difficulty with the unique Vayusa business concept (See Exhibit One):
Until now credit cards have been either a ‘card present’ transaction or a
‘card not present’ transaction. With mobile phones they are not sure which type of transaction that would be. We are creating a whole new category of transaction and their underwriting group is lost as to how it is going to work.
In early October of 2002, Tom Huseby, managing partner at Seapoint Ventures (and now
Ajay’s good friend and mentor) invited the pair to Seattle to make their pitch for start-up funding of one million dollars. While Tom’s partners had seen the Vayusa presentation months earlier from Ajay and Walter, this time Bob would be manning the Powerpoint.
The Term Sheet
Shortly after returning to Boston, Ajay received a call from Seapoint partner Susan
Sigl. It was the call that he’d been working for over two years to make happen:
We got a term sheet from Seapoint for a half a million dollars. There were three conditions on the term sheet.