27 Mar How To Find Venture Capitalist Perfect Option For Businesses?
How to find venture capitalist
Do you know who is venture capitalist? A venture capitalist is a person who provides capital for the start-up, invest in a business venture or an expansion. Individual venture capital is hard to find and exist in the form of professional firms. The way of working with these firms is that they pool investment funds and invest that money. For this, they look for the projects that provide a high rate of return. The venture capitalist always prefers the start-up projects due to their high return capability. On the other hand, the stock market has some limit and involve low return. This is the reason that funds are provided only to the high return projects. The main investment sectors for venture capitalist include clean technologies, IT, bio-pharmaceuticals, semiconductors, etc.
Why venture capitalist perfect option for businesses?
The venture capitalist invests in companies in the form of equity financing. With this, the supplier of the fund holds the equity position in the company. This form of business loan is suitable for start-ups, businesses that cannot secure loans or high-risk business profiles. Adding to this, the business also looks for the equity financing from the additional business experts. VCs are the long-term investment and last from five to eight years. The main intention is to support a company till the shares have value and are bought by the public.
The venture capitalist expects to get over 25% return as there is a high risk involved. VC gathers money by pooling from wealthy investors, pension funds and insurance companies. The firm takes intense care to decide on which firm to invest. In return, it also manages to get management fees and compensation to a certain percentage.
Find right venture capitalist
Here are steps through which a venture capitalist can be located:
Gather information from venture capital (VC) association: Venture capital group has a huge collection of information on venture capitalist. They provide the tools and resources that assist in finding the right VC. So they are the right firms to contact for the small and large businesses. Adding to this, the internet also has a collection of regional and national associates that provide details of top VC. Some of the top venture capitalist associations include – The small business administration (SBS), The National Venture Capital Association and The Angel Capital Association. The associations provide the complete facts of the funding process, the listing of professionals and other vital data. Get a list of accountants and attorney who work with VC’s and get the link to important websites.
Ask experts: Experts help is always a perfect option to pick the right venture capitalist. Business brokers, corporate attorneys and successful entrepreneurs will be the best option to refer to the final decision. Moreover, it is good to check with the business associates, colleges, popular social networks and important people. The internet is also the perfect option to find using the names and contact information.
Explore the internet: The internet is the perfect option to gather any detail of the venture capitalist. Just need to know the type of investment your business requires for expansion or start-up. For this, find and subscribe to the blogs of the venture capitalist. Search for the VC’s social network and check the online database. Using the internet, it becomes easy to sort the investment needs. It can be on the basis of location, industry, amount of fund needed or the business state.
Do proper research: Do proper research to get the right contact number of the genuine VC. Check the social platforms like blogs, Facebook, LinkedIn post, etc to get the complete information. For ensuring the company’s success, make sure to clear the time VC invest in development, exit strategy and management style. This is must to avoid any future problem.
Check references: Each business has a unique financial need. Due to this, properly analyse business needs and then check the references to get right venture capitalist. Make sure to check VC’s references to know how many winning deals it has provided. This will help you to know most recent deals. You can visit the website and check all the deals and clients.
Hire professional: The support from an expert is very important. Look for the expert venture capital consultants, professionals, corporate attorney, etc. They will help to look for the right VC as per the company need. The extra support you get also include investment guide, packaging, marketing, traditional financing.
So for start-up firms, it is basic to know who suits as an investor. This will definitely add to the success rate and growth in near future. Investors play a vital role in financing a business. So never compromise on the quality of the venture capitalist. Always scrutinize the service of VC before making the final deal. This is the secret of success in start-up companies.