Venture capital firms want to make money but they also look for investments that can provide a hefty return. Even more important is that most have particular industry segments that they look to invest in. This means that they are looking for large markets where they can gain a competitive advantage.
Searching for a Venture Capital Network
In many areas, Venture Capital investment is formed as an investment network. These networks bring together groups of individuals to assess investment opportunities and to provide a funding mechanism for the group. Starting your search through a venture capital network begins with three criteria: industry, funding stage and geographic location. Remember to research the firm for their portfolio investments to see if there is some prior investing history in your industry segment. This allows for you to see their prior history and how you might have to position your pitch.
Network for Venture Capital
Gaining access to a venture capital firm requires a great elevator pitch and being tenacious. It also will make your life easier if you network through your professional contacts – you never know who might be able to connect you to a contact within a VC.
Your Pitch to Venture Capital Firms
The requisite documents you’ll need when pitching venture capital firms include your Executive Summary (pitch deck) with financials. Remember to link your website in any email that you use so it is easy to find your documents.
Initial VC Investment Terms
There are plenty of venture investment terms that surround a deal, but there is only a handful that you’ll absolutely need to know to get you through your early stage meetings. Understanding your valuation, the impact of dilution, and the use of a stock options will all prove useful going into the discussions.