Venture Captial- And all about it.

beejay · 12th January 2010, 17:00

Well, the title says it all and I believe I can get some honest and crisp answers here rather than just believing some VC site that just shares information that just needs to be shared. Hope you guys get the drift.

Now,
Whats the minimum that a venture capitalist would be interested to invest? Understand that I mentioned minimum, as I guess it needs to be lucrative and big enough.

Where do you find the right VC?

What would be the binding factor?

What would be the risk factor ? Guess there's a catch in everything, yet.

Why would the VC invest?

What happens if you goof up?

Whats the best thing that would interest a VC?

Total, how does this whole thing work?

aditbelw · 12th January 2010, 17:24

Beejay,

Theoretically, a VC finds you. He likes you Idea, and then makes you approach him. If you need to hunt for a VC, the best way is going in through Investment Bankers, since they have good contacts , and might be able to guide to the the viable VC firms. Another way is, use your contacts; be it family/friends, and get angel investment up.

There is no such binding factor, as far as I have seen and felt: it's a game of money;They invest, You double the investment , they are happy you are happy.

Usually,the risk factors involves: They asking for a much bigger Equity.VC's might be directly involved in the operations along with you/your team..which can get really irritating when two parties are not ready to compromise on one's decision. Asking for security & a lot more depending on what they realize in you and your team.

VC's usually Invest, as it says: to Invest and some for philanthropic purposes.

Goof Up..!!! If you have given any security, time to say Good Bye to it...!!

Different VC's have different opinions and interest as in where to Invest.

As for the process, it's generally a lengthy one, though if your concept is Great, it might me easier. Remember, Google was denied VC funding by 3 firms spanning a few years, so you might guess what it's like dealing with them.

All the Best..!!

Quote:

Originally Posted by beejay

Well, the title says it all and I believe I can get some honest and crisp answers here rather than just believing some VC site that just shares information that just needs to be shared. Hope you guys get the drift.

Now,
Whats the minimum that a venture capitalist would be interested to invest? Understand that I mentioned minimum, as I guess it needs to be lucrative and big enough.

Where do you find the right VC?

What would be the binding factor?

What would be the risk factor ? Guess there's a catch in everything, yet.

Why would the VC invest?

What happens if you goof up?

Whats the best thing that would interest a VC?

Total, how does this whole thing work?

beejay · 12th January 2010, 18:09

I was sure I get the no nonsense answer here and you did just that. Thanks aditbelw.

Your replies were just to the point. Any idea on which are some good VC's in India. Angel investors a good idea.

Thanks again.

aditbelw · 13th January 2010, 09:28

Beejay,

I have read & heard, about Mumbai angels , being swift in disbursements and being quite transparent.

Though, you might want to check on some US/UAE based VC/Angel Indians.

Thanks!

Aditya

COUGAR · 13th January 2010, 10:06

the way it worked for me, and i think thats the way it must be for most others, is that my CA got me introduced to some, well, lets just say investors. VC's would be too sophisticated a term to use in this context!

then there are the other kind: fixers i call them. The kind who hang out with laptops at Barista's who will arrange for funding in return for a stake. This particular species of animal doesnt talk in terms of making money but BURNING it. They are filled with useless gyaan they picked up in their 2 years at some IIM but little else. One such fixer introduced me to a term called CBR - Cash Burn Rate. Needless to say i havent bothered returning his calls!

Better to grow slowly and let growth be funded by revenue. Slow and Steady wins the race!

ajayr · 13th January 2010, 10:14

Hi Beejay,

It might be worthwhile to interact with this organization: TiE Global - Fostering Entrepreneurship Globally They often conduct networking meetings where entrepreneurs and VCs get together.

deepaktpatil · 13th January 2010, 10:16

Each city has interest groups which are frequented by VCs and entrepreneurs. If you are looking at technology startups Indus Entrepreneurs is one example. Cant remember any other group off the head right now, will post it later.

Try joining these groups based on your interest area and you should be be able to make some progress. Networking and interacting is the key here.

beejay · 13th January 2010, 12:16

Quote:

Originally Posted by COUGAR

then there are the other kind: fixers i call them. The kind who hang out with laptops at Barista's who will arrange for funding in return for a stake. This particular species of animal doesnt talk in terms of making money but BURNING it. They are filled with useless gyaan they picked up in their 2 years at some IIM but little else. One such fixer introduced me to a term called CBR - Cash Burn Rate. Needless to say i havent bothered returning his calls!

Man, and I thought they were just time pass crowds. I can literally picture one guy when type this who used to hang around everyday in the MG road Barista in Bangalore. I used to work in the adjacent building there. This guy was a frequent and my shop guys told me that he is a high society pimp who shows people prospective clients on his lap top.

Quote:

Originally Posted by ajayr

Hi Beejay,

It might be worthwhile to interact with this organization: TiE Global - Fostering Entrepreneurship Globally They often conduct networking meetings where entrepreneurs and VCs get together.

Thanks for the link. Will pass it on.

Quote:

Originally Posted by deepaktpatil

Each city has interest groups which are frequented by VCs and entrepreneurs. If you are looking at technology startups Indus Entrepreneurs is one example. Cant remember any other group off the head right now, will post it later.

Thanks Deepak. Actually this is for a very close friend of mine and the project is based on luxury retail.

Quote:

Originally Posted by aditbelw

Beejay,

I have read & heard, about Mumbai angels , being swift in disbursements and being quite transparent.

Though, you might want to check on some US/UAE based VC/Angel Indians.

Thanks again Adit, will search online.

12th January 2010, 17:00	#1
beejay Senior - BHPian Join Date: Apr 2009 Location: The Nilgiris Posts: 1,963 Thanked: 204 Times View My Garage	Venture Captial- And all about it. Well, the title says it all and I believe I can get some honest and crisp answers here rather than just believing some VC site that just shares information that just needs to be shared. Hope you guys get the drift. Now, Whats the minimum that a venture capitalist would be interested to invest? Understand that I mentioned minimum, as I guess it needs to be lucrative and big enough. Where do you find the right VC? What would be the binding factor? What would be the risk factor ? Guess there's a catch in everything, yet. Why would the VC invest? What happens if you goof up? Whats the best thing that would interest a VC? Total, how does this whole thing work?
	() Thanks

12th January 2010, 18:09	#3
beejay Senior - BHPian Join Date: Apr 2009 Location: The Nilgiris Posts: 1,963 Thanked: 204 Times View My Garage	I was sure I get the no nonsense answer here and you did just that. Thanks aditbelw. Your replies were just to the point. Any idea on which are some good VC's in India. Angel investors a good idea. Thanks again.
	() Thanks

13th January 2010, 09:28	#4
aditbelw BHPian Join Date: Apr 2009 Location: Bangalore/Naini Posts: 201 Thanked: 222 Times	Beejay, I have read & heard, about Mumbai angels , being swift in disbursements and being quite transparent. Though, you might want to check on some US/UAE based VC/Angel Indians. Thanks! Aditya
	() Thanks

13th January 2010, 10:06	#5
COUGAR BHPian Join Date: Dec 2005 Location: Delhi Posts: 548 Thanked: 94 Times View My Garage	the way it worked for me, and i think thats the way it must be for most others, is that my CA got me introduced to some, well, lets just say investors. VC's would be too sophisticated a term to use in this context! then there are the other kind: fixers i call them. The kind who hang out with laptops at Barista's who will arrange for funding in return for a stake. This particular species of animal doesnt talk in terms of making money but BURNING it. They are filled with useless gyaan they picked up in their 2 years at some IIM but little else. One such fixer introduced me to a term called CBR - Cash Burn Rate. Needless to say i havent bothered returning his calls! Better to grow slowly and let growth be funded by revenue. Slow and Steady wins the race!
	() Thanks

13th January 2010, 10:14	#6
ajayr BHPian Join Date: Dec 2007 Location: Bangalore Posts: 94 Thanked: 19 Times	Hi Beejay, It might be worthwhile to interact with this organization: TiE Global - Fostering Entrepreneurship Globally They often conduct networking meetings where entrepreneurs and VCs get together.
	() Thanks

13th January 2010, 10:16	#7
deepaktpatil BHPian Join Date: Dec 2006 Location: KA 05, MH 10 Posts: 303 Thanked: 128 Times	Each city has interest groups which are frequented by VCs and entrepreneurs. If you are looking at technology startups Indus Entrepreneurs is one example. Cant remember any other group off the head right now, will post it later. Try joining these groups based on your interest area and you should be be able to make some progress. Networking and interacting is the key here.
	() Thanks