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What is the top thing Venture Capitalists look for in a Venture?

What is the top thing Venture Capitalists look for in a Venture? In an Entrepreneur?

15 Replies

Mike Whitfield
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Mike Whitfield Entrepreneur
Sr. Software Engineer, EPAM, Google
If I may attempt to confer my second-hand knowledge (based on conversations, I don't have leverage or sway over these people to truly "know").

VC's are more subject to FOMO than the average consumer. They not only suffer from FOMO, but they are incentivized to get-in quick for a better deal and they want a tangible get-out strategy. Beyond that, it's individual. VC's don't care about your startup *at all* prior to a signed and dotted relationship. Your secondary job as a startup is to make the VC empowered with unique knowledge about the market they wouldn't otherwise know (it might help inform another position in their portfolio, a good portfolio is cohesive *and* diverse). It is within their market "right" to shop around, so I think the strategy is convey value with your knowledge but be likeable and believable that you can "do it".

There are literally like 10 or 20 players doing *exactly* what I do, and it's PhD specific. Some of them probably have more traction, more self-funded capital, more time in the software profession. Why on earth would an investor choose me? The buckets of rationale are probably some proprietary mix of a) motivation b) presentation c) skill d) experience e) wisdom f) infrastructure g) existing resources h) alignment i) convenience/proximity j) focus k) reputation

Seed == team, vision quest
Series A == numbers, longevity, market share and feasibility

Happy to form a mindshare group on this or be looped into an existing one lol (tired of sounding so right, would like to execute in a group setting)
Shea Writer
0
2
Shea Writer Entrepreneur
Entrepreneur
No Risk, High Return. (Applies to both.) Shea Writer Director; NSDB Group Australia: +61 2 8011 4406 UK: +44 20 8144 7796 USA: +1 917 310 0864 https://NSDB.com *LEGAL NOTICE:* The entirety of communication is to be recognized as *CONFIDENTIAL*: Intended to be reviewed by the designated addressee, exclusively.
Craig Conlee
3
1
Craig Conlee Entrepreneur • Advisor
Founder/CEO at Zealr
They look for a Business Person, not an entrepreneur. If they are looking for an "serial entrepreneur" type, run!
Seabrook Barnett
1
0
NodeJS, C# Web Developer / Trend Forecaster - Over $30 Billion Successfully Forecasted
I find that last post very interesting. I feel "Business Person" takes on a more serious connotation than "Entrepreneur." Is there anything else to consider?
nilay singh
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nilay singh Entrepreneur
looking for opportunity in tech startup
According to me VC looks the background of founders if they are from very good academics like IIT and harvard they will easily invest in any idea . I have seen this when I was pitching . Most of the time investor invest in people rather than idea
5 Star Film Co.Ltd. *
0
0
5 Star Film Co.Ltd. * Entrepreneur
Agents for an Award Winning Television Channel Franchise
The Usual boxes,they like the boxes checked,and you will find those boxes on every Investor Funding Social Network Site. However many of those website businesses fail,because they try to define and control how the protocol should take place,rather than allow the Investors and Businesses negotiate freely and define their own terms.
Seabrook Barnett
0
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NodeJS, C# Web Developer / Trend Forecaster - Over $30 Billion Successfully Forecasted
Nilay, that seems to be true but irrational seeing that 75% of Tech Billionaires under the age of 40 dropped out of college.
nilay singh
2
0
nilay singh Entrepreneur
looking for opportunity in tech startup
Seabrook I am talking about India almost every company is founded by an IIT alumuni
Craig Conlee
2
0
Craig Conlee Entrepreneur • Advisor
Founder/CEO at Zealr
Its very simple and it's not academic. Its an idea that solves a real problem.
Then money. Money is execution and execution means money. Team is important, but Timing is everything.

Nothing has changed people. ...Nothing. Sites like FD is one big dead horse that people like to beat over and over again. LOL!

On the opposite end, the only thing I do know is, nobody knows anything. Wait, and one more thing.... you have to be human, because 100% of billionaires are human. Oddly enough, it seems to be true.
Dwayne Johnson
2
0
Dwayne Johnson Advisor
Social Alchemist - I build equitable, prosperous, sustainable smart cities and regions.
By "VC" I'll assume you mean an investment fund of some sort (Angels, Private Equity, Venture Capitalists, etc.) who'd typically invest in some stage in the life of a rapidly growing company.

People is always #1.

A good individual can convert a good idea into a successful business. The reverse is rarely true.

Does one of the founders have domain expertise in areas most critical to business success? If you're a bike enthusiast developing new wheels for mountain bikers, yes. If you've never been on a bike and you thought this up while watching extreme cycling on TV? Not as much.

Can the individual/team execute? Have a track record? Known or have good references? Come prepared? Persistent? Coachable?

In many ways an investment is like a marriage. After signing the deal you may be stuck with each other a while so it helps if you like each other, know what you're signing up for, and are in it for the long haul.

#2 Is there and invest-able BUSINESS here? (i.e. am I the investor going to make the amount of money I need in the time I need it)

It never fails to surprise me that some people act like they don't understand that investors want a return on their investment. If you want to make an investor smile, show them that you've thought about how they're going to get a return on investment. Show that you treat the investment like a precious good to be managed and used when needed. If you don't know how to manage a budget; get the skills and/or find someone who does. Giving money to someone who doesn't know how to manage money is a sure way to loose it.


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