Insight from a venture capital partner on the right way to think about the startup fundraising process. Whether you're approaching family, angels or large venture capital firms, many of the same themes apply.
A guide for entrepreneurs trying to raise angel and venture capital
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5. Credibility builders…. “ This is bigger than Google!” Surround yourself with credible advisors, references, etc Lead with the business story – not the product Be savvy / realistic Acknowledge who you are / who you need Our key technology advisor is the CTO of…. We believe that there are over 1,200 large companies that consider this issue their number one concern…. I can deliver the product but really need the following help… There have been 13 start-ups funded in this area… here’s what we need to do to compete… Serious. Smart. Credible.
6. Who wants to invest in you? Wasted time Appropriate Targets Approached by Entrepreneur Missed opportunities Good meetings!
7. Do your homework… We are a $1B fund that makes growth capital investments in military technology companies. Do they want to hear about your cell phone social networking technology? Would they be interested in your Series A proof of concept for a new missile technology? www.bigvc.com
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10. Investors are BUSY – they want “bullet points” not conversations. Really Fast Fast Duration of lightning strike Closing time for average kill Wing cycle interval Time spent listening to “pitch” before interrupting Time spent reading long documents
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12. How to increase probability of getting a meeting: Email or send a business plan 0% Email a well written executive summary 2% Personal referral; phone call; email executive summary. 20% Blood relationship combined with compromising photos. 25%
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