Find out who has it and what they’re willing to bet it on.
You’re driving home one day, thinking about how your company should approach the distribution of their products and services. How many times and in how many ways have you demonstrated the idea that will move the firm to the next plateau. But each time your idea has been misquoted, mismanaged and generally mangled by the doofus who runs your department. You aren’t going to get by him either, because Dad runs the business and is Mr. Doofus Sr. So you go out and put together a really killer business plan, convince all of your friends to kick in their life savings and get the distribution channel up and running. Now you are convinced your business is the next eBay or Amazon or CDNow or VerticalNet. Buy you need some money. The bank won’t lend it to you, because you need it. So you turn to the Venture Capital market place. How do you find out who has the money and what they are investing in? You can start with funds located right here in Philadelphia. Try the Ben Franklin Technology Partnership: http://www.benfranklin.org which is a state funded program that helps with seed capital for new companies. They also have a conduit to some of the more aggressive bankers in the region.
You can also try Argosy Investment Partners LLP (610) 971-9685, http://www.argosycapital.com . Try Early Stage Enterprises LP at (609) 921-8896
http://www.esevc.com. If you need further information, and you will, take a look at some of the following resources:
Harvard VC Club: Top Venture Capital Firms http://wasat.hbs.edu/vc/vc_links.html
A list of the top venture capital firms, with links to their Web pages, as constructed by Harvard’s VC club.
Venture Capital Resource Library http://www.vfinance.com/
Explore this extensive directory of venture capital and tax code resources that includes current news, feature articles about investment opportunities and links to other important online resources for venture capitalists.
Garage.com http://www.garage.com/
Garage.com is an Internet resource that helps to bring entrepreneurs and investors together. Investors can browse the list of registered startup companies that need capital, while business owners can register to find resources to build their companies.
Inc. Magazine: How to Finance Anything http://www.inc.com/incmagazine/archives/02980341.html
A look at the best places to find financing, including private-equity investors, banks, venture capitalists and non-banks. Also, some common pitfalls to avoid when seeking capital.
PricewaterhouseCoopers Money Tree http://www.pwcmoneytree.com
The PricewaterhouseCoopers Money Tree Survey is a quarterly study of equity investments made by the venture capital community in emerging private companies in the United States. As such, it serves as a barometer of regional and national economic health demonstrated through entrepreneurial developments, and identifies promising industry segments. The survey has become a staple for the financial community, entrepreneurs, policy makers and others who track “hot” companies throughout the country.
US Small Business Administration http://www.sba.gov/INV
This is the Small Business Investment Company web site. It lists all of the SBIC program offices, which are part of a national program partially funded by the SBA. You should take a look at this site. You will find a wealth of good advice and sound information.
Information Venture Capital Firms Want to Know
Venture capital firms will judge you by how prepared you are. Critical documents are:
Business Summary: a brief statement covering the main points that includes a discussion of: management, profits, strategic position, exit plan
Business Plan: a detailed document that outlines what you are going to do and how you are going to do it, including a clear and simple discussion of: the idea, management team, including full resumes, business strategy, marketing plan, including sales, distribution, market, competition, financials, competitive analysis
The business plan should answer: What is the growth potential of this company or project? What does the company do? How does the company operate? What are the projected revenue and profit margins? How is the capital going to be used? How will the capital infusion affect the financial projections? What type of exit strategy is foreseen?
Due Diligence: a study of the background and financial reliability of the company, management team and industry.
Marketing Material: any document that directly or indirectly relates to the sales of your product or service.
Bill Haney is the executive director of the Internet Business Alliance and principal outreach Manager for Concurrent Technologies Corporation. He can be reached at haneyb@ctc.com.