Tag Archives: Venture Capital

Artificial Intelligence: The Trend For Tech Startups

Artificial Intelligence From The Startup Garage

Artificial Intelligence: The Trend For Tech Startups

Looking to get funded in 2015?

Why not add some elements of the “The Terminator” & “The Matrix” to your Startup Business model.

Funding increased 302% for Artificial Intelligence (AI) Startups in 2014. Pouring in over $309.2 million in over 40 deals. That’s more than 20-fold in just 4 years from $14.9 million in 2010.

Artificial Intelligence Startups are those that work in NLP, machine learning, deep learning and predictive APIs among other core applications.

The rebirth and mini-boom of an Artificial Intelligence industry can give thanks to iconic tech entrepreneurs and investors like Microsoft, Facebook, Google, and Amazon. Google set the funding stage in January 2014 with $400M acquisition of Deep Mind Technologies.

Deep Minds Technology’s recent achievement includes a computer that learns how to play video games similar to humans, while possibly mimicking short-term memory of the brain.

It’s examples like these, which mesh together science fiction and startup innovation, that has investor interest in A1 so hot. “Many AI companies have raised significant money without any product plans.” Said Scaled Inference Inc. Founder Olcan Sercinoglu.

Falling technology costs have also helped catapult AI startups. Processing large amounts of data, the core of AI work, is now cheaper as computer chips have gotten faster and the costs associated with storing and accessing data have dropped.

The backbone of any great startup is “What Problem Inspired Your Business? And What is your Solution.” AI Startups ultimately provide clever tools to solve both corporate and consumer problems. “Solving Intelligence,” by building learning algorithms to better understand and predict human behavior, among other uses.

Consumers and investors alike are witnessing and investing in, computer brains or AI tools, resulting in an increasingly powerful edge to the information age.

The evolution of human super intelligence is at a noticeable tipping point, set to have a massive impact at both an individual and global scale. As a Startup Entrepreneur the questions remains will you be part of the problem? or part of the solution?

If you have a question about your Startup or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

The Startup Garage’s Top 10 Best Blogs of 2014

The Startup Garage’s Top 10 Best Blogs of 2014

2014 was a momentous year for entrepreneurs and startup companies around the globe. Through out the year The Startup Garage has shared our knowledge, resources, and insights with you in efforts to skyrocket your success.

Below our Top 10 Best Blogs of 2014, we hope you find them invaluable and worth referencing time and time again.

How To Evaluate Your Startups Business Model

The business model is the means by which your company makes money for the value that you deliver to your customers. Learn how to create a strategy to monetize your product or service. Find out more here: How To Evaluate your Startup Business Model

What Type of Funding is Best for My Company?

There are three main sources of funding, family, friends, and founders.
Learn to how determine which funding source is right for you.
Find out more here: What Type of Funding Is Best For My Company

How To Raise Startup Capital In 120 Seconds

A quick pitch should serve as a teaser of what’s exciting and noteworthy to come next. The intention of a 2-minute pitch is to deliver a heavy dose of substance, content, and sizzle regarding your Startup’s investment potential.
Find out more here: How To Raise Startup Capital in 120 Seconds

Infographic What’s Your Entrepreneurial Vision?

Behind every entrepreneur or startup founder there is vision, mission, and purpose on how to serve the world at large.
What’s your vision?
To Make the World More…
Beautiful? Smart? Fun?
Find out here: Infographic What’s Your Entrepreneurial Vision

How To Determine Market Traction For Your Startup

Market traction is proof that somebody wants your product; it communicated momentum in market adoption. The more market traction you can demonstrate the less risk there is in the investment.
Find out more here: How To Determine Market Traction For Your Startup

Social Media A Startup Must-Have

5 Reasons why Social Media is no longer optional for your Startup Business. Find out more here: Social Media A Startup Must-Have

How To Define a Small Business Vs. A High-Growth Startup

A startup company, also referred to as a high-growth startup, is a company with a business model that is designed to be repeatable and scalable. This is directly opposed to a small business,
Find out more here: How to Define a Small Business Vs. A High-Growth

How To Write a Term Sheet For Your Startup

Technically speaking, a term sheet is a non-binding agreement that demonstrates a basic set of terms and conditions under which an investment is made, typically by either an angel or venture capital investor.
Find out more here: How To Write a Term Sheet For Your Startup

How Long Does It Take to Raise Capital?

The average time is somewhere between three to six months for both you Angel round and your Series A round. It really breaks down into three major steps.
Find out more here: How Long Does It Take to Raise Capital

Why A Business Plan Is Essential When Crowdfunding Your Startup

Letting the crowd fund your startup doesn’t mean allowing your business plan to go unwritten. In the business world, approximately 543,000 new businesses get started each month and funding those businesses comes from a variety of sources. Find more here: Why a Business Plan is Essential When Crowdfunding Your Startup

If you have a question about your Startup or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

Startup Business Funding Report 2014

Startup Business Funding Report 2014

The past year has been an eventful one for Startup Businesses in their quest to raise capital.

Venture Capitalists, Angel Investors, and Peer-to-Peer Crowdfunding soared in 2014, breathing new life into uncertain economy.

    Venture Capital Roundup

According to the PitchBook Platform 88 billion dollars in venture capital was infused into the global economy in 2014. Beating out any other single year ever, including the dot.com era.

Silicon Valley continues to reign supreme as the most competitive market to raise VC funding in, while hometown hero Uber took the largest 2 VC deals at 1.2 billion each.

On the east coast, the city that never sleeps, NYC is also thriving in the innovation economy, coming in 2nd in United States venture capital hubs. With the biggest VC backed deal going to coworking space, WeWork, with $355million dollars in funding.

It’s fair to say the venture capital ecosystem had an incredible run in 2014, transforming software startups into “unicorns” and providing hope and opportunity in the face of aversion. Whether or not all the risk will bring sustainable long-term rewards will become more evident in years to come.

    Angel Investment Roundup

2014 found Angel investors and groups becoming more prominent on and offline for early stage startups. At this time the Halo Reports Q4 report for 2014 is still being compiled, however we anticipate a steady increase in investments similar to previous quarters.

In Q2 alone 206 deals were funded totally $594million.
Pre-money valuation continued to rise jumping to $3 million in Q2, while Healthcare and Internet funding continues to be the most heavily funded industries.

Across the board opportunities to #GetFunded are abundant amongst individual Angels and Angel Groups globally. While with in the US, California, New England, and Texas have the most active investment networks.

    Crowdfunding Roundup

Crowdfunding is rapidly changing the landscape of Startup funding, and doesn’t appear to be slowing down. At the close of 2014, crowdfunding is estimated to add at least 270,000 jobs and inject more than $65 billion into the global economy, according to estimates from crowdfunding platform Fundable. 2014 turned platforms like Kickstarter and IndieGogo into household names. On Kickstarter alone 3.3 million people globally pledged more than ½ billion dollars last year, which is equivalent to $1,000 per minute. The funding brought to life 22,252 creative projects, exploding the alternative-funding platform.

Its clear Crowdfunding is disrupting how investors find opportunity and where entrepreneurs fuel their startup ideas. For the first time in history anyone can be an entrepreneur, investor, or both and the trend has yet to reach its tipping point.

    2015 & The Future of Capital Raising

2015 is sure to be a year of that will go down in history for innovative Startups and investment opportunities. The Startup Garage anticipates the following achievements in the next year: more women in the tech and the venture capital spotlight, emphasis on entrepreneurship and education with in academic institutions, and a rapidly expanding Startup Ecosystem.

If you have a question about your Startup Funding or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

The Unsung Heroes of Startup Funding – The Large Corporation

Large Corporations Investing in Startups from The Startup Garage

The Unsung Heroes of Startup Funding – The Large Corporation

Sunne Justice sat across from me, explaining her company mission, and her interest in creating a conscious cloud technology business.

She had a startup business that had successfully raised 1.5 millions dollars for a cloud technology venture.

Listening, I was amazed, “How could a business, 5 years in the making; one that still had their product in beta (a type of tech trial basis), managed to raise so much venture capital?” “Of course,” I thought. “As an experienced corporate CEO, it must be easy for Sunne, to raise the money. She had the contacts.”

But after a lot of research, some digging and a few interviews, I realized that many startups have found the venture capital they needed, and without too much of an effort; even without having too many corporate contacts or finance experience.

They just knew where to look.

If you have a great idea or an existing start-up that needs money to grow, you can borrow from friends and family but a better and more lucrative option, may be to find venture capital in the corporate world.
 

Where Do I Find The Kind of Capital I Need?

A new resource, just recently on the rise is the corporate world. More and more large corporations seem to be opening up venture capital funding departments.

“Wait a minute! Wasn’t that something they tried in the late 1990s?”

It is true. Many financial institutions and corporations tried their hand at venture capital investments and lost their hats in the process. But that was a time when corporations where only looking at the bottom line of a start-up. Now their vision is more global. They see start-ups as an opportunity for innovation.

Venture capital funding has decreased since the late 1990s. But if you have a solid business plan, a good product or idea you can still find venture capital investors. They are everywhere and continually increasing. In fact, now multinational companies are venturing into the startup world.
 

The Big Guns

Yes, that’s right. Companies like General Motors, American Express, Verizon, Google and PepsiCo, are just a few of the blue chip companies that have fully functional venture capital departments.

What’s The Deal? Why are large corporations implementing venture capital funding departments?

There are several reasons for this. Some multinational corporations are looking to get a piece of the startup action… but more likely, many of these corporations see startups as a viable research and development solution.

According to the New York Times, companies like General Motors, have investors based in their research labs. Large corporations across the globe are investing more than $20 billion in startups – and that’s no small chunk of change.
 

The Startup Advantage

Where other types of investors could be put off by certain startup investments because of a lack of real profit, large corporations see the same start-up venture as an opportunity. Blue-chip companies turned venture capitalists seem to be less concerned with profits, than they are with future innovative ideas.

Corporations are often restricted by regulations and by internal policy. This impedes their ability to be innovative. So instead their idea is to share with small, innovative businesses that are outside their own corporate enterprise.

For the large corporation, a promising startup could be a way to stay ahead of the competition; a way of innovating their existing products and of delivering superior value to their stakeholders.
 

The Result

The growth of successful startups is making established corporations reconsider new business opportunities and the way they search for innovation. Today, this means offering corporate venture capital, alliances, licenses and joint development. For them, venture capital departments have become a useful tool which they use to stimulate innovation.

For startups, this new interest from large corporations is great news. It means more resources for their ideas, products and inventions. It means access to funds they couldn’t otherwise find, even if they find funding from friends and family. When looking for funds larger than a few thousand dollars, this is certainly a funding option worth considering.
 

Finding These Venture Capitalists

Before looking for corporate venture capitalists, you must make sure everything is in order. You need a highly-detailed business plan. You need guidance from experts in business plan development; experienced consultants who know what corporate venture capital departments look for; those who know what corporate investors to point you toward.
 

If you have a question about your Startup or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

How To Determine Market Traction For Your Startup

How To Determine Market Traction From The Startup Garage

How To Determine Market Traction For Your Startup

The major thing to know about the first few years of funding a startup business is that in order to attract investor capital you must accomplish certain milestones.

Accomplishing milestones helps to reduce the risk associated with the startup venture.

Investors are constantly assessing risk when evaluating a startup and obviously prefer those that assume less risk. Additionally, accomplishing milestones allows you to raise capital at a much higher valuation because you’ve thereby improved the risk-to-return ration (i.e. the riskier the business the more equity the investor will need to compensate the level of risk).

There are seven main categories of milestones that most investors assess when evaluating a startup
investment opportunity:

Business Planning

– Team Building

– Market Traction

– Legal

– Operations

– Product Development

– Founder Leadership

The specific milestones that you need to achieve within each categories varies depending on the type of business and the stage of capital that is being raised(startup round, seed round, series A, etc).

In this post, we’ll be focusing on the milestones that demonstrate market traction.

What is Market Traction?

According to Naval Ravikant, the Co-Founder of Angel List, market traction is simply defined as
“quantitative evidence of market demand.” Traction is proof that somebody wants your product, it communicated momentum in market adoption.

Why is Market Traction Important?

Per usual, it all boils down to risk for an investor. The more market traction you can demonstrate the less risk there is in the investment.

How Do You Demonstrate Market Traction?

Adequate market traction will vary at each round of capital simply because you have limited resources
to demonstrate it. Furthermore, one of the major reasons that you are raising capital is because you
want to grow your current traction.When raising capital from Friends, Family, and Founders in the Startup Round the amount of market traction that you can demonstrate is limited. You likely don’t have a product developed that is ready for market, so traction in the form of sales is not attainable. However, you can show potential traction by demonstrating the size of the market and trends that support your product claims and solutions.

Additionally, you can conduct primary research such as surveys and conversations with potential
customers and/or partners to help validate your value proposition. Lastly, you can put together a clear marketing plan to demonstrate how you will reach potential customers.

When raising Seed capital from Angel investors you will need to take your market traction to the next
level. This includes obtaining some Beta testers and ideally, some paying customers. You’ll need a full scale marketing plan that proves a significant market opportunity exists based on what you’ve learned about the market to date.

Ultimately, you need to prove that you understand the sales cycle for your business.

Lastly, when raising Series A capital and beyond from Venture Capitalists or institutional investors you need to show how you will scale the business. By this point, you want to deploy the capital raised in earlier rounds to not only show that there is a demand for your product but that you can scale the product. In order to demonstrate this you need to understand what it costs to acquire a new customer and what the lifetime value of that customer is.

If you have a question about your Startup or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

Why A Business Plan Is Essential When Crowdfunding Your Startup

Business Plans and Crowdfunding

Why A Business Plan Is Essential When Crowdfunding Your Startup

Letting the crowd fund your startup doesn’t mean allowing your business plan to go unwritten.

In the business world, approximately 543,000 new businesses get started each month and funding those businesses comes from a variety of sources.

Most recently, startups are beginning to utilize crowdfunding sites to promote their ventures and raise the capital they need through online platforms.

Similar to the popular TV show Shark Tank, startups have the opportunity to present their business to a number of “backers” who can potentially finance their business. Such crowdfunding websites are making it easier for new business owners to spread the word of their company and search for possible investors.

On the flipside websites like Kickstarter, Indiegogo, and Fundable are allowing for investors to check out a multitude of emerging businesses for possible fruitful endeavors, which leads us to….


5 Reasons Why A Business Plan Is Essential When Crowdfunding Your Startup

1) A business plan will be used as a blueprint for your crowdfunding campaign.

It will help define the purpose of your business/project, how it will operate, specify the exact amount of capital needed, and it how it will reward/benefit those that invest. These details are the key ingredients necessary for a successfully funded campaign.

2) A business plan is a SYSTEM (S)aves (Y)ou (S)tress
(T)ime (E)nergy and (M)oney
when building and launching your business, both on and offline. Going through the process ahead of time, can prevent and even correct mistakes that might have otherwise gone overlooked.

3) A business plan is one of the most compelling marketing tools available to enroll others in your mission. After all, a crowdfunding campaign is only as successful as it’s amount of supporters.

4) A business plan will be used as an internal tool for you business as well, guiding your company through the first 3-5 years. Following this document with in your business will provide structure and stability, even during the most uncertain of times.

5) Eventually crowdfunding capital runs dry, and you need to look for your next funding source. Most likely that would be an angel investor, an individual who typically invest between $25,000- $100,000 of their own money. Angel investors want to see facts and figures. They want a well thought out business plan, one that demonstrates you have taken the time to do research, plan and organize your startup business. Exemplifying less risk and more return on investment.

2015 will be a revolutionary year for crowdfunding; with current trends stating an average of 325 new crowdfunding campaigns launching everyday.

This means investment opportunities and competition for funding are expanding at a rapid pace. Are you ready to #GetFunded?

Don’t let your business plan remain unwritten.

If you have a question about your Startup or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

What’s The Best VC Pitchdeck?

Venture Capital Pitch Deck from The Startup Garage

What’s The Best VC Pitchdeck?

What’s The Best VC Pitchdeck?

Don’t live your life impressing others. Live your life impressing yourself.

The above is an interesting quote that relates to many aspects of life and business, especially when pitching your startup to the venture capitalists.

The best pitch deck comes from the heart; it’s not one created for the benefit of venture capitalists. It is for yourself, an outgrowth of the startup business you’re raising.

When you prepare your company’s business model for the VC pitchdeck, pay attention to the details:

  • Make it eye catching
  • Demonstrate your passion for your business
  • Make it compelling
  • Make it concise and to the point
  • Demonstrate the urgency of getting this deal done. Show the VC why it benefits him (not you) and if he doesn’t go with the deal, make sure he understands someone else will.

Your VC pitch deck needs to be a great snapshot of your business.


What You Need To Know

As an entrepreneur seeking investment, you will be asked to present a detailed financial model.
A financial model that demonstrates and explains all of the possible assumptions behind the numbers.

This financial model is the key to your getting the funding you need. It is a tool you use to show your real perspective to investors. Your financial model needs to be more compelling than the average run of the mill catalog financial model.

How to Prepare Your Financial Model

Think of answering these core elements when preparing for a funding round:

  • Assumptions that a VC could make.
  • P&L Marketing
  • Balance Sheet
  • Key Forecasts
  • Metrics

Cover These Vital Elements in Your Presentation

You must do your homework and cover these areas as they relate to your particular heading.

  • Your Market Size
  • Projected Growth of the Market
  • The Way in which Your Business Meets Your Client’s Unmet Needs
  • The Value Your Business Offers
  • Market Competition
  • Strengths and Weaknesses of Your Business
  • Business Model
  • Metrics
  • Financial Model
  • Historic Outline of Your Business
  • Future Timeline
  • Return Options
  • Risks
  • Exit Strategy
  • Your Team

Actions Speak Louder than Words

Keep in mind that VCs want to see your past, current and future actions. These are key elements that speak to them. They don’t want to hear the fluff. Show them a detailed financial model that tests their assumptions. Show them how your startup is going to make them money.

What Are the Assumptions a VC May Have?

A VC will always make assumptions. That’s the way he forecasts the possibilities for investing in the business. Use historical data to base your future growth assessments on reality.  Use metrics that demonstrate the number of users for your service or product, the amount of money you generate for each user, new types of revenue and other data that pertains to your business.

Short Term and Long Term Cash Strategies

A VC wants to know about your cash administration. He wants to know how you are going to manage your finances and the potential funding raised.  Effective cash flow strategies ensure you keep enough cash on hand to meet the business financial obligations. These include payroll, suppliers, customers, loans, inventory and expenditures.

What Happens Afterwards?

When and if you do get VC funding your business and financial models don’t sit idly by. You and your management team need to work and improve these models constantly. They serve as a guide for your business as it develops. Your performance will be judged according to your initial forecasts.

 

Whether you have a question about you investing or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

How To Raise Startup Capital In 120 Seconds

How To Raise Startup Capital In 120 Seconds

7 key takeaways from the Tech Coast Angels Quick Pitch Finals 2014.

Think of a quick pitch as you would a movie trailer.

1) A quick pitch should serve as a teaser of what’s exciting and noteworthy to come next. The intention of a 2 minute pitch is to deliver a heavy dose of substance, content, and sizzle regarding your Startup’s investment potential.

A simple outline when delivering a quick pitch is:

• Your name and title
• Your business name
• What problem inspired your business?
• What is your solution?
• What does your business need to achieve the next level of success?

In this specific instance, a panel of 7 judges, scored the 10 startup finalist in 2 separate categories: Content and Style. Each judge held up a scorecard with 10 being the best and 1 being the worst, for each category.

2)Decide who on your Startup Team best delivers your company’s message.

Not all founders or co-founders were meant to step on stage (in this case in front of an audience of 500 people) and “perform.” Explore who on your team accelerates in public speaking and leverage that ability.

For AstroPrint this person is CEO Drew Taylor, his ability to remain relaxed and assured during their pitch, made a “high-tech” complex process simple to comprehend.

3) Practice. Practice. Practice.
There is only way to become a Quick Pitch Master, the answer is practice, practice, and more practice. Practice not only your pitch with different people, but also in different environments.

Perhaps this was the winning ingredient for nPruv CEO Summer Rogers. The panel of judges applauded her for repeatedly practicing nPruv’s pitch in the auditorium where the event was taking place that night.

There’s an unquestionable value and confidence that comes with practicing on the specific stage you’re presenting on.

4) Engage with your audience.
Quick Pitches are designed to create a level of curiosity and interest in the Startup. As the presenter, talk to NOT at your audience, help make them to feel they’re a vital part of a conversation.

*It’s fair to note your audience includes not only the panel of judges, but onlookers as well.

Doctible CEO, Ajit Viswanathan brilliantly highlighted this point. With in his presentation he included a slide with the judge’s pictures, which the crowd and judges went wild over. Making his pitch point both relevant and relatable to all.

5)Enthusiasm.
Remember enthusiasm is contagious. A Startup pitch with out enthusiasm can leave the listener feeling you’re not invested or inspired by your company, why should they be…

GetTAGit.com CEO & Founder Ana Bermudez, oozed enthusiasm, from her walk, to smile, to tone of voice, it was clear she’s created a Startup she’s excited to share with the world.

6)Timing.
2 minutes or 60 seconds can seem like an eternity for some or race to beat the clock for others.

In this instance a clock illuminated the back wall below the presenter’s slideshow. Regardless, of their feeling toward the ticking seconds, there was no avoiding it.

Interesting enough, those Startups that concluded their pitch prior to time running out (5 of them to be exact) were not in the event’s winners circle.

CleverPet Co-Founder, Dan Kundsen along with Companion Medical’s CEO, Sean Saint were the 2 out of 10 Startups with perfectly timed out pitches.

7) The Pitch Close and Following up.
At the end of a perfect pitch lies 2 key ingredients:

• Summarizing your entire pitch in 1 sentence. Think about it like this, if your audience were to walk away with one message regarding your Startup what would you want that to be? Often times the close is also the tagline for your Startup.

• Invite the opportunity for people to follow up with you, and find out in greater detail what about your Startup and the investment opportunity. All those finer details that a 2 minute quick pitch couldn’t cover.

Congratulations to all 130 Startup Companies courageous enough to enter the Quick Pitch Competition, especially the top 10 finalist we had the pleasure of watching at the event.

Special congrats to nPruv for winning the grand prize, Companion Medical for winning the content category, and GetTAGit.com for winning the style category.

It’s Startup companies like yours that continue to shift the landscape of business innovation. Thank you!

 

Whether you have a question about your Startup or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

Angel Investments Soar in the U.S. Along with the Tech Coast Angels

Angel Investments Soar in Q1 along with Tech Coast Angels

Angel Investments Soar in the U.S. Along with the Tech Coast Angels

The Q1 2014 Halo Report was released recently by the Angel Resource Institute, Silicon Valley Bank and CB Insights

In a collaborative effort to raise awareness of early-stage investment activities by angel investors the Halo Report researches and analyzes angel investment activities and trends in North America.

This quarter’s report card will one most investors in the U.S. will be proud to share.

“Median angel round size increases to $980k, while pre-money valuations rise to $2.7 million in the quarter”

What’s this mean for Startups looking to raise capital?

It is one of the best times in history to get funded.
Especially, if your startup relates to the Internet, Healthcare, or Mobile, which make up 71.5 % of deals in the quarter.

“Opportunities are great for startups seeking funding today,” said Rob Wiltbank, Vice Chairman of Research, Angel Resource Institute.

Are you a California based Startup? Consider your ability to get funded that much more likely. California angels invested heavily locally accounting for 1/3 of all deals.

One investor network, Tech Coast Angels, seized the spotlight and proves that “your network, is your net worth.” Tech Coast Angels secured the “strongest network” spot on the Q1 Halo Report out of 370 angel groups, alluding to their greater ability to raise capital, as well as offer strategic expertise in a given area.

Perhaps this is due to their investor membership application process itself, which puts network and community 1st and money 2nd.

“You might think it’s to make money, but for many of us it’s a way to give back to the community, to help build successful companies and to participate in the satisfaction that comes from this involvement. And we hope to make money, too.”

Tech Coast Angels claims to be largest angel investor network in the Nation. Since 1997, and TCA has helped their portfolio companies attract more than $1.4 billion in additional funding. TCA is a catalyst in helping build Southern California’s economy into a thriving center of technology and entrepreneurship.

Feeling inspired and ready to #GetFunded?
Tech Coast Angels is hosting a quick pitch competition in San Diego Thursday Sept 25th, 2014.

Quick Pitch is a must attend event for entrepreneurs looking to jump-start their ventures and for investors seeking to learn about the latest innovations in Southern California. Be sure to say hello to The Startup Garage team at the event!

Whether you have a question about your pitch or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

The Past, Present and Future of Capital Funding

Past Present And Future of Capital Raising from The Startup Garage

The Past, Present and Future of Capital Funding

The Past, Present and Future of Capital Funding

The Internet and the integration of valuable software into corporate systems, has disrupted almost every industry there is, laying bare vast quantities of knowledge, which in the past was extremely well hidden and only known to a privileged few.  Just 10 to 15 years ago, you had to be lucky to find the right “know how” and get the right connections. In fact, breaking into certain industries could often take a whole generation or more. Now, those days are gone.

This phenomenon of “open knowledge” we live in today opens up all kinds of opportunities for entrepreneurs and for investors as well.

 

This knowledge is laid bare through information, blogs and media all available over the Internet; information that was not available in any way shape or form some ten years ago.

As a modern entrepreneur, all you have to do to find out what a venture capitalist is looking for is go to a VCs blog.
Some of the most respected VCs now share their insights, the process,  the things they look for in a startup and even information they require in a specialized business guideline.

When Did It All Start?

We can say that venture capitalists like Naval Ravikant, Fred Wilson and Brad Feld were pioneers. They began to open up and tell us what they wanted to see through their blogs back in 2002 and 2003.  Later we saw companies like Venture Hacks and The Funded pop up. These sites even allowed people to begin rating VCs – a feature that disgruntled many an investor.

Their Contribution

Thanks to these blogging pioneers, we now have explicit and clear information on what a venture capitalist looks for, what a term sheet is and how to reach them. These were once hidden clues that only the very clever entrepreneurs could find.

The Next Step

Alongside this initial contribution we’ve also witnessed an incredible advance in technology, which significantly reduces the cost of launching a new company. This means many new startups don’t need those large VC funds to get started. This opened the doors to SuperAngels or MicroVC.  This is an investor that has a collaborative mindset, one that doesn’t have a large board of directors, and one who offers easy terms. In turn this opened up a new trend for investors, that of open discussions, personalities and easier terms.

Now Comes the VC Service Provider

VC firms are now so open that many have changed the way they do business completely, making the VC a service provider.  The software they use to streamline their startup networks and companies has gone a long way towards making this possible.

Government Help

The federal government has also put its two cents in with The Jobs Act and Crowdfunding

This gives entrepreneurs online options for raising the money they need.

The Future

Many angel investors and entrepreneurs feel we are on the brink of new change. They believe the average business bank loan may quickly go out of style, and instead people will fund other people; mentor them and network them with others.

In exchange investors will share in their success. If they can’t pay you back, then no consequences, but if the entrepreneur is successful then so is the investor. The key to doing this effectively will be through the use of algorithms which identify the best people to fund.