I recently worked with Angie Chang of Women 2.0 on a Huffington Post Blog; Angie Chang in Huffington Post: Serial Entrepreneur Carol Realini Shares Tips for Raising Venture Capital. One entrepreneur posted “This leaves out the most critical thing that new entrepreneurs need – information on exactly how to get 10 meetings with VCs. Especially if your company is not located in Silicon Valley.”
Very good point, but you also need to remember meetings are just part of fundraising. These VC meetings are critical but they need to be
- successful meetings
- lead to due diligence
- lead to term sheets
So don’t ignore the 10 tips for fundraising advice. http://bit.ly/pr9skU
That being said, I agree a big challenge is to get the right meetings with the right potential investors. So let me try to demystify how to do that.
As you plan your fundraising, you need to give yourself time to get these meetings set up. You have work to do. Some of that work will require being in Silicon Valley. I read somewhere that a large percentage (like 80%) of all venture capital comes from VCs located in the San Francisco Bay Area. You want to be where the money is.
Here is how I would approach it –
- Build a network of advisers and supporters that know Silicon Valley VCs and how to navigate the valley.
- They will be helpful in many ways. There is a lot of activity that is a waste of time – take their cues on what is worthwhile and what is a waste of time.
- The best local supporters know VCs and can make introductions. They can also talk up your deal and create a buzz in the valley. So you not only need to connect with these supporters, you need to sell them on your business.
- Entrepreneurs need to be evangelists – recruiting supporters, employees, customers, partners, to support their vision for their business. Get good at this. Also don’t oversell. Not everyone will love your idea especially in the early days before it is proven. So be prepared to get rejection – and don’t sweat it, learn from it and move on to find people that get excited about what you are doing.
- To build your support network you will need to invest a lot of time in connecting and building relationships. But don’t make supporting you a ton of work for your supporters. You figure out which VCs are the best targets, you make sure your business presentation is strong and gets better everyday. Make it easy for them to help you.
- Look for groups or organizations that can help you build your network like TIE and Women 2.0. Get connected and meet people. This is a open valley – it may seem intimidating but outsiders can break in.
Once you have a strong network of supporters, then you leverage them to make warm introductions to your VC targets. Don’t even think about making a cold call on a VC – it is a waste of time.