10 tips to deal with venture capitalists, told by a venture capitalist
The Jerusalem Business Networking Forum is a unique meeting place, allowing pushers and pullers to find each other. Running monthly events for the past 3 years, it has provided a launch pad for many future contracts.
So when Ted Nehmad, the Director of investment group “C Capital” was scheduled to give a talk, you can understand why there was a quality attendance. Now, Ted sees too-many-to-count requests for seed money or investment funding every month. His list of successes is wide ranging.
Ted’s presentation detailed 10 “must dos” for those seeking to raise capital, and several in the audience were taking copious notes.
- Just go for it. A good idea is not enough for success. You need to get out there.
- Do not rely on a one-person show, but a team.
- Define a justifiable business model, based on real market values and focused on final users. (Exit is not a model).
- Create a hook – a cool elevator pitch.Essential! Your personality can make the difference.
- If you work with angels, remember they can be devils. Sell your company, but not your soul.
- Preserve your funds.
- Learn to dance with investors. They are always one step faster, looking for an exit, before you have thought about it.
- As the grip of angels and VCs may be diminishing, multinationals are setting up incubators; HP and Cisco are 2 examples, with Amdocs in Israel.
- Another alternative is to “go east”. This February, after nearly a decade of probing China, Israel’s Pegasus Technologies was purchased by Yifang for US$60m.
- Don’t forget – be determined. Your success will not come without some pain.
Just words? Not true in reality? I have recently finished mentoring a client, where we spent much time working on their pitch. They are now busy making sales.
Too simple? Look at the headlines in today’s Israeli financial press.
German electronics giant Siemens is considering investing considerable capital in Israel, according to recent meetings in Germany between representatives of the Federation of Israeli Economic Organizations and Siemens. The meetings were held to find ways of increasing cooperation in R&D and investment in Israel.
Not a one-off statement:
Intel Corporation (Nasdaq: INTC) has acquired the assets of Israeli PC virtualization start-up Neocleus Inc. for a few hundred thousand dollars. The company’s 15-20 employees will join Intel Israel’s R&D center.
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To prove the point about using multinationals, see how Abbott is settingup an incubator in Israel: http://www.haaretz.com/print-edition/business/abbott-enters-r-d-deal-with-industry-ministry-1.312626