An excellent guide for first time entrepreneurs who think they need venture capital http://www.accel.com/entrepreneurs/advice.html

A Diary of A VC Financing http://www.upside.com/texis/mvm/story?id=34be83180

What a Start-up is really like

Start with a lesson from the top VC in the Silicon Valley. John Doerr's Start-Up Manual. http://www.fastcompany.com/online/07/082doerr.html

Accel Partners gives you an in-depth presentation on building World Class companies http://www.accel.com/entrepreneurs/world_class.html

Read the best start-up book to date. Jerry Kaplan went through $75 million of VC's money and went bust. Reads like fiction, but it's all true. http://www.amazon.com

The Rewards. People that made it. Big.

Four millionaires from Oracle's early days share their views of success. http://www.fastcompany.com/online/09/oracle.html

Frequently Asked Questions

Answers

1.	Where would we start looking for Venture Funding? Because we develop Software, we have a had time with people seeing the "tangible" asset the software is.
	Start with the Vancouver Enterprise Forum at www.vef.org and click on the Money Links button. On the island, call Viatec and ask for their help.
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2.	Hi Brent: Which venture capital firms are still interested in investing in telecommunications networks these days? This company (our client) is a start up with a plan to do infrastructure building, leasing and revenue sharing with carriers for wireless and broadband networks in remote areas. Thanks, Lorraine
	Most early stage VCs focus on technologies as opposed to services, but it is not a firm and fast rule. If it is a raw start-up network with high capital costs of entry (to purchase fiber or other networking gear) it would be a very hard road. If it was up and running with customers, much easier. Always check with the larger VCs directly to find out.
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3.	I am a recent SFU finance grad currently taking CFA II and I am interested in working for a venture capital firm. I was wondering if there are any VC associations in the Vancouver area that I could join? I read about the Angel forum but it appears to be a meeting place for entrepreneurs and venture capitalists already immersed in the industry. How can I get exposure to this fascinating area of finance? Thank you for your time.
	The only VC association is the Canadian Venture Capital Association (www.cvca.ca). Locally you can meet VCs in: a) their office, by phoning them up b) events like VEF, WinBC, BC Biotech and BC TIA sponsored c) Caffe Artigiano on Thurlow and Pender where a few have been spotted periodically d) seedy bars where its dark and damp Actually, d) only applies to a few of us. Seriously, the industry is small in Vancouver and getting in the door requires some work. Good luck.
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4.	our company is looking for working capital to finch part's of our product that we are developing :
	I suggest you use Capital Connector here on T-Net to look for money instead of this "Ask The Expert" forum. Thank you.
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5.	I have a business plan that includes manufacturing of voice activation software. My business plan also includes the retail store aspect of this niche market. Should I separate the products we will manufacture, from the overall business plan so that financing for the manufacturing side would be easier to obtain? The software is for the special needs markets
	I can't speak for investors in your manufacturing side of the business, but my giess is that they will want a full business plan to understand your objectives and opportunity better before helping you with debt. If I were you I would have a business plan section on manufacturing processes (ISO etc.) in two versions, one for the regular business plan and a detailed one for the folks interested in supporting your manufacturing.
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6.	Is there a min amount that emerging companies can access thru venture capital. We are doing an analysis of a fictitious firm and have determined that thru grants etc. we only need $200,000 in external financing and are trying to decide whether to access venture capital, angel financing, sub-ordinated debt or LOC. We are students in an MBA program. Thanks for any help, Mike Cass
	The minimum is typically $1,000,000 from institutions for working capital. For development, especially at the seed stage, VCs have sometimes put as little as $100,000 in for a business plan or a proof of concept. But those cases are limited to people that they know pretty well to begin with. Seed funds invest less than typical VCs ($250 - $750K). At the Western Technology Seed Investment Fund in the late 1990's, that's what we did as a range. Sub-debt is a non-starter if you do not have positive cash flow. So angel financing or friends and family financing (sometimes your friends are VISA and Mastercard) are your only options likley.
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7.	Can you tell me where i would find a list of BC companies receiving Venture Capital Funding.
	The actual companies only appear in detail at www.canadavc.com if you have a membership to their VC Reporter. Since it is expensive, you could glean the info from BC Technology news announcements (search on "funding" or "capital") or CanadaIT.com where all Canadian tech press releases are archived.
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8.	i would like to try to riase some venture capital. we have a growing company manufacturing hockey equipment. we have a policy with edc and are set up with i-trade finace for our financing. we need an injection to grow more. we are currently exporting to japan and the U.S.. how can you help??? thasnks in advance, Gary Sande
	Most venture capitalists in BC focus on technology investments. The general rule of thumb is that you can only raise private equity when you have a big opportunity and a great team to execute the plan. I am not aware of any VCs that would look at hockey equipment, but you could try looking at the web sites of the financiers listed on this site and check.
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9.	Hello; Our young company is in the process of attracting investors, and would like to know if you have a list of questions that we should be asking of them, or if you can direct us to existing info. Any suggestions that you have are very much appreciated. Thank you. Regards, Lynn
	You should always do your homework on an investor and understand what they are looking for in terms of 1)stage of development of the companies they invest in 2)amount of money typically invested 3) how much money they control 4) what sectors do they invest in 5) who they have co-invested with in the past Then you should make sure you understand their process to evaluate you and make an investment. Always ask them for references once you have engaged and the investor is starting the due diligence process.
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10.	Mr. Holliday; I have a quick question for you. Is there a formal route that individuals/a business must go through to start the stream of communication between entrepreneur and VC or venture partners? Should one just call up an office and ask to meet with someone or would it be better to send in an exec. summary and hope for someone to call the entrepreneur? Given VCs and capitalists are inundated with the number of business plans that come across their tables, how do you make it stand out as “the plan of plans?” Thank you in advance for any help, ideas, or suggestions. Chris Reid
	The process should go like this: 1) entrepreneur should research the VC firms and understand which ones invest in their particular space (look at the web site for explicit industry coverage and click on "investments" or "portfolio" to see what they actually have invested in). 2) Then they should research the partners if the various VC funds that DO invest in their space and figure out which is more likely to know about the industry (again on the web site or ask around town). 3) They should not send a plan to the general mailbox with a Dear Sir/Madam opening becasue that implies a crap shoot. Those go to the very bottom of the pile. 4) Ask your lawyer, accountant, board member or exeprienced technology executive who they can introduce you to in the VC community. Introductions are more valuable from those that have invested or taken a board position, but any introduction will guarantee more than a "delete" key in the VC's e-mail Inbox. 5) Send only an executive summary of 4 pages maximimum to the VC to begin. Then hound them every week until you get a NO or a let's meet. I said every week, not every day. Your plan will be the "plan of plans" only if you have known entities involved. In other words, the fastest way to get a VC to move is when you have a world-class set of founders and/or managers that have been in the exact industry that they are entering with the new company and have incredible customer knowledge and contacts.
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11.	I'm looking for funding for an Internet based project. Angel Investment or seed capital looks like our best be right now. Do you know of any networks or programs(other than the VEF Angel Network) for linking up angel investors with entrepreneurs? Or do you know of any local seed capital funds?
	There are angel groups around, but they are not listed in the Yellow Pages. The best way to reach angels from the tech community is to network aggressively. Go to events, talk to VCs and find out who they recommend. As for seed funds, most of the local VCs allocate some funding for seed investments, but a couple are focused on the earliest stage. They are Smart Seed, Idea Park (Itemus) and soon, Launchworks (currently in Calgary, but opening here shortly. Good luck.
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12.	We have developed a idea, prepared a Business Plan, Executive Plan, Power Point Presentation and we also will have a working model of the actual site in a couple of weeks. We are now at the stage where we can actively seek investors. My question is how much can we expect an investor to take of the company, shares etc.. We are looking for first stage financing for $600.000 with the grand total being $5M.
	First of all, investors don't "take" a piece of the company. You sell it to them at a price. If the value of your company today is $1M in your mind and the investor adds $600,000, the total value is $1.6 MM immediately after the financing. The investor has bought 37.5% of the company. That's how it works. It is all based on the pre-money (what you're worth before the money) and post-money (add the money invested) valuation. The real negotiation with an investor is at what pre-money value do we agree? You want it higher, the investor wants it lower and somewhere in the middle you meet.
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13.	We have an excellent concept which we feel was made for the internet. We have an executive summary and a business plan and are ready for the next step, but no money or contacts. How do we go about getting someone like you interested or even getting a meeting setup, with the right people. Lorenzo
	First of all, research the money sources through their web sites and word of mouth to see what they invest in and at what stages. Then try and get someone who knows someone in one of these funds to "vouch" for you or introduce the deal. Just sending it as an e-mail attachment works, but gets to the bottom of the pile and will be responded to more slowly. You can also try the Capital Connector on this site to get your plan filtered and sent to appropriate people in one shot. But there is a direct cost asscoiated with it. Good luck.
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14.	In our discussions with Internet/ecommerce technology start-ups we have found that having a sound technology plan can add allot of credence to a business plan. Many organizations approach us a with very sound business models but their success will be almost entirely be based on their ability to translate that business model into a technology model. Not to mention, in most cases, the need to execute in a compressed time-frame in order to competitive in the .COM space. We are preparing a presentation on the subject of developing a sound technology plan and its benefits to the both the organization rasing capital and to the investor. Do you have any ideas as to the organizations that would be interested in this topic? I look forward to your input.
	It is not just the technology plan, but the execution of same that gets the desired results. And execution is all about having the right people with the right expertise. Having said that, I believe that most companies founded by non-technical people in the Internet/ecommerce space lack a sound technical plan. There is a market for this. You should go to the VC firms and make yourself known. Another place to go is the Incubators and or seed capital providers. I would talk to the Software Productivity Centre and see if their is a partnership possible there.
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15.	Brent, I'm working on a research project and am looking to find out all the big venture capitalist in Vancouver who might invest in BC High Tech Company's. Is there some sort of magic list? Your help would be greatly appreciated, as soon as possible. Regards, Kelli Gayford
	Kelli: All of the Canadian VCs are listed at http://www.cvca.ca The local ones are listed at http://www.vef.org as are all other funding sources. You can call me anytime to discuss. My number is at http://www.greenstonevc.com
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16.	I hold the Canadian franchise for a software product developed in the U.S. The U.S. company is looking for venture capital. Do these tNet services only apply to products or services developed in B.C.?
	No. Many of the Angels and some of the funds on the Capital Connector are able to invest in US companies or help find US VCs that can invest in them.
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17.	Is a gypsy swap the shortest means to an end, or should we pursue venture capital to close the $150,000 acq of an e-mail bill/invoicing company. This being complicated of course, we further have a recognized IT professional to placate and comfort the V-Caps spoken to in Aug. I have in hand a number of expressions of interest for Tier 1 billing software we have not built from our Tier 3, which is ready for sale. So chicken or the Egg, and here we are at the worst time of year to raise capital. respectfully Mike Tymo 250-335-0999
	I'm afraid I have not got enough information to answer your question properly. Raising capital for an acquisition is more difficult than for your own idea. What guarantes do you have that the deal will close after you get my money? Do I make my money conditional and then you lose the deal because the other party doesn't think I'm committed? Do you have a vehicle that they can get shares in? Then you can vend in the technology and raise money with a clean intellectual property position.
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