Searching for Venture Capitalists? Know Where and How to Find Them!

If you are currently starting a new business venture, you may be searching for venture capitalists or venture capital funding. Before you start your search, it is important to know that venture capitalists only fund certain types of business simply because they want a large profit and quick return for their investment. If a professional office or small restaurant is what you have in mind, you would not be a perfect candidate for acquiring a venture capital. However, if you have an innovative product or a high technology invention, a venture capitalist would definitely be willing and eager to talk with you.

Many business ventures find raising venture capital a challenging task. No matter how challenging it is, you’ve got to go to the first process – finding the perfect venture capital firm. This may seem simple but it isn’t. There are practically a lot of firms in the USA alone and picking up the wrong one is one of the reasons why many companies and starting firms fail to come up with the capital they need for their business venture.

When searching for a firm to help you, there are six important things to consider. Here they are:

1. Location

Almost all venture capital firms invest only within 100 to 150 miles of their office. By dealing with businesses close to their office, these firms can get involved more actively and add greater value to the companies in their portfolio.

2. Sector Preference

Venture capital firms focus more on specific sectors like information technology (IT), healthcare, wireless technologies and more. More often than not, even if the company is great, if it falls outside the firm’s sector preference, these firms will pass on this great opportunity.

3. Stage Preference

Venture capital firms focus more on different phases or stages of the business venture. There are some firms that prefer business ventures on the early stage because although the risk is high, the potential returns are also high. On the other hand, there are some firms that focus more on business ventures trying to bridge the capital gaps before going public.

4. Portfolio

Remember to seek for a firm with portfolio companies in the line of business that you have. Venture capital firms often consult portfolio company management before investing on a business venture.

5. Partners

Venture capital firms have individual partners. These partners help the firms make the decision of whether to invest on your company and they take time to study the portfolio of the company seeking for investor. Partners of these firms tend to invest on the business that they know so it would be better to look for a venture capital firm with partners who know your business well.

6. Assets

Like other companies searching for venture capital, your company will require ensuing rounds of capital. Because of this, it is important if you can find a venture capital firm with deep pockets. This means that it has enough cash to help you in follow-on rounds. This will help save time and effort in keeping an adequate or enough cash balance.

There you are – the six important keys when finding venture capitalists. The question now is where to find them. Going back to key # 1, these venture capitalists are just within 100-150 miles of your area. What are you waiting for? Start finding now!

Venturing into any business online is such an overwhelming idea especially when all you can hear about is how profitable and effective it is to do business here. While this is true, the biggest part still falls on you. Included in this ‘big’ part are advertisement, promotion and of course, SEO. Let “Words in Action” takes its share from that part. “Words in Action” is a team of writers trained to write high quality and original articles only. We value timeliness, confidentiality and most of all quality. Deliver your message to your potential customers through words in action delivered to you by “Words in Action”. For more information, email us at mahal_00803@yahoo.com.