When raising funds for your business, you will find yourself scouting for investors or people who will help provide you with capital. After all, money is what will get the ball to start rolling. While you have options, such as angel investors or your family and friends, you can actually turn to venture capitalists.
For starters, venture capitalists are investors or a group of investors that invest money in a start-up. Generally, they’re employed by an investment company or venture capital firm. These are different from angel investors, as the latter are usually private individuals with very high net worth.
Now, it’s important to understand that you cannot find venture capitalists by just listening to the radio ad on your car stereo. You will need to exert a serious amount of effort to find a suitable investor. Here are some of the things to keep in mind:
Find companies that invest in your industry
Start within your industry. You can list down venture capitalist firms investing in companies that are similar to yours or are in the same industry. This is one of the ways that will allow you to have a fighting chance. While you’re at it, you might want to check their track records. If possible, you can reach out to some of the startups these VCs have invested in (as long as they’re not competitors). They can provide you with insights and information regarding the interests of the investor.
Mind your stage or phase
Which stage of financing is your start-up in? Are you in seed funding, Series A, or Series B? Some venture capitalists only decide to come in at a specific stage of the start-up. So if you’re running a start-up at the seed funding stage, you might not have a chance with a venture capitalist looking to fund start-ups that are already at the Series A phase. Companies at this stage have already developed a customer base and a stable business model.
Attend industry events
Industry events, such as trade shows and even start-up fairs, can be a good venue to find a venture capitalist. Normally, venture capital companies organize these events to look for potential companies to invest in. Competitions, such as hackathons and programming challenges, are created to find talents and start-ups that have promise. So, don’t miss your chance! Try joining them.
Talk to a consultant
Sometimes, venture capital firms can be elusive, given that they have busy schedules and a lot of start-ups to attend to. If you want to up your chances, you can work with professionals, such as consultants, corporate lawyers, and the likes that have connections.
You’ll find the right one!
It might seem that finding the right venture capitalist can be difficult, and it can be! You have to stop at nothing because that is when you will find the right one. If you have not found an investor within your personal deadline, try again! Look again at your business plan and make sure that it’s attractive to investors.