Tips for the Venture Capitalist
A venture capitalist is defined as one who invests long-term and relies on a hands-on approach with each of their investments and works actively with entrepreneurial teams that specialize in management so that they can create awesome companies.
Understanding How Venture Capital Works
Anytime someone starts a new business, it takes money to get it up and running. It takes money to rent or purchase office space, equipment, furniture, and supplies. While avenues such as tapping into your personal savings, getting a bank loan or bootstrapping are ways to get money for the startup costs, venture capital is another choice. You will often hear about a private equity firm when it comes to venture capital. There are a few different choices when it comes to choosing a private equity firm. Some are known as passive investors while other is active investors.
The Main Key is Knowing Your Business
While you may think that you have a great feel for your business, a venture capitalist will nitpick when it comes to your vision for your business, business operations, and business projections. When you are dealing with a venture capitalist, you need to be able to convey these message in an articulate way. The goal is to impress them with numbers when it comes to business operations and business growth.
Right Time to Raise Capital
The majority of venture capitalists will take an interest in businesses that can properly prove that there is a market for their product or service. They look for businesses that have the right amount of capital to change the path of the business.
Prepare for the Long Haul
You may find that raising venture capital for your business is like a whole other job. It takes a great deal of time and effort but it does pay off in the end. It is important that you keep detailed records of everyone you speak with including when you spoke with them and the appropriate follow-up items.
Know How to Approach Venture Capitalists
The main thing that financiers are looking for is a competent team. One way to show them that you are a hard-working, driven, and determined entrepreneur is to be introduced to them through folks that they trust. They will be much easier going with your business if someone they know introduces you.
Many entrepreneurs have a Power Point presentation that they used to pitch to capitalists. With constant practice, you cannot only shorten the length of your presentation but you can also cut it down to about 15-20 minutes long. The majority of backers will allow you half an hour to an hour to present your pitch so you need to be extremely precise in the way that you deliver your message to them.
Have Materials On-Hand
It is important that you have everything in one spot such as legal files and operational statistics. This way you can share everything you need with investors that are interested on the spot. When an investor shows interest in your business, you need to be able to keep that momentum going before they lose interest quickly.
Employ a Great Attorney
The reason that you want to hire a good attorney is due to the fact that venture terms are always and forever changing. Financiers are always negotiating the terms of investment while the majority of entrepreneurs will only take part in this a couple of times throughout their career. When you hire a lawyer that is skilled, educated and experienced in the field of venture capital, you will come out ahead in the never-ending battle of constant changes.
Learn from the Best
When it comes to venture capital, Efraim Landa is one of the best in the business. He has more than 30 years of experience in the medical field developing, marketing, and selling an array of product lines. Efraim Landa is the co-founder, chairperson, and CEO for GlucoVista. This is a company that is in its early stages but develops a unique approach to measuring blood glucose levels noninvasively. Efraim Landa has extensive knowledge and experience with high tech medical companies, private equity financing, establishing distribution networks, and business divestitures.
Posted on July 15, 2014, in Effi Enterprise, VC Firm, Venture Capital and tagged Effi Enterprises, investments, professional investors, venture capital firms, venture capital funding. Bookmark the permalink. Leave a comment.