How to find wind-selected investors

Venture capital financing has never been an easy task for enterprises, and successful financing today is more difficult than before. In the past, you could attract capital with a creative or ingenious idea, but today, if you don't have real core technology, the chances of successful financing will be very low. In the past, if the management team only used PowerPoint to introduce enterprises, now venture capitalists need a truly experienced team to manage and operate enterprises. You can boast that your customers are Fortune 500 companies, but today you must provide a list and the sales revenue brought by your customers as proof.

The process of enterprise financing is like the process of rational love and finally marriage. When you choose your "ideal partner", you need to know their financial situation, personality, preferences, orientation and their expectations of you.

Who can be your investor?

Different venture capitalists will invest in different types of business opportunities. Some venture capitalists only like to provide start-up funds, others like to invest in growth companies that expand their capital, and some venture capitalists focus on investing in a certain industry or region. To successfully obtain their funds from venture capitalists, you must fully understand their requirements and orientation. Using crude strategies in the financing process can only make investors think that you have no idea what you are doing and are wasting their time.

Industry: Many venture capitalists focus on certain industries and will not consider industries beyond their investment scope. Some of them specialize in investing in the semiconductor industry, others will invest in health care equipment, biotechnology or internet services, but some still like to invest in traditional low-tech enterprises. From the past bets of venture capitalists and their internal investment policies, we can determine whether they are interested in your industry.

Region: Venture capitalists in Silicon Valley don't mean companies that only invest in Silicon Valley. Some venture capitalists invest nationally or globally.

Early investment: Some venture capitalists like to invest in the early stage of enterprise start-up. Early fund can be subdivided into seed financing, venture financing and first-stage financing. Seed money is an investment concept, which helps to realize the concept; Most of the initial funds are used to set up a management team to bring products or services to market; Initial capital is the capital used by an enterprise to expand its production, marketing and sales capabilities when the initial capital is exhausted. Generally, the investment targets of early-stage funds are enterprises with business creativity and high potential return, that is, enterprises that can bring investors 10 times return within 5-7 years. Venture capitalists will also provide management advice and guidance to the enterprises they invest in.

Expanding funds: Some venture capitalists choose to invest in growth-oriented enterprises. Expansion funds can be subdivided into second-stage financing, mezzanine financing and bridge financing. The funds in the second stage are used as working capital to expand the scale of enterprises; The investment targets of Paris Capital are some enterprises with balanced income and expenditure and substantial growth or expansion plans; Bridge funds are usually short-term financing and paid after the company goes public. This kind of fund will select some enterprises that will go public next year. The development fund hopes that enterprises can bring 4-6 times returns to investors within 3-4 years. These enterprises need to have stable income and profits, and the investment amount is generally between $3 million 300- 10 million.

M&A or acquisition funds: These funds are used for the needs or acquisitions of M&A mature enterprises. Most of the funds are mainly composed of debt and a small amount of leveraged buyouts, and the amount of capital investment generally exceeds $6,543,800+million. The risk of this kind of investment is relatively low, so the income is lower than that of early funds and expansion funds.

How to communicate with your investors

Meeting with venture capitalists is not a simple matter. Don't think that you can meet them by finding their contact information, and don't think that you can successfully raise funds by meeting investors. The most direct and effective way is to find some reliable references to introduce you.

Enterprises should first make initial contact with venture capitalists in financing. The first meeting is very important. You need to clearly explain the outline of your financing project within 3-5 minutes to attract investors to follow up your story further. You should prepare a detailed business plan, which should include company background, company structure, company location and facilities, business strategy, product strategy, enterprise characteristics, business model, revenue and expenditure model, milestones, technology, strategic partners, customers, intellectual property ownership and so on. You should also make investors feel that you have a clear understanding of the market, industry, target customers, suppliers and competitiveness. After preliminary investigation, if investors are interested in investing, they will issue an indicative clause. Indicative clauses are documents drafted by both parties after preliminary discussion. Only after the investor has completed due diligence, the two parties have decided on the investment conditions and signed the sales agreement can the transaction be recognized.