Tuesday, January 22, 2013

12 Tips on Raising Venture Capital for Your Startup

Burning a hole at the top of a long list of needs for a startup entrepreneur is good old Benjamin Franklins.

Yes — stacks of capital needed to fund dreams of a vast and bright future.

And what entrepreneur among you couldn’t use a few more dollars for your startup?

Yes — just what I thought.

So reaching out through the ranks of my connections I came across the good fortune to pick the brain of Paul Jones, former Silicon Valley resident with Cooley Godward and current Chair of the Venture Best group for Michael Best and Friedrich.

Jones is a serial venture capital backed entrepreneur; angel investor; and Co-Founder of a $26 million early stage venture capital fund.  He was Entrepreneur of the Year and President of the Council for Entrepreneurial Development in North Carolina and also serves as the Fund Investment Adviser for Angels on the Water, a Wisconsin Angel investment fund.

So in an hour long rapid fire discussion; Jones gave me his 12 best tips on raising venture capital any aspiring entrepreneur would be wise to listen to:

1.) You Have to Decide: High Impact or Small Business Entrepreneur?

Yes — you call yourself an entrepreneur. But hold the phone — because unless you have a pretty clear idea going in what your aspirations are; you could find yourself flailing around like a ship without a rudder.

As Jones explains it; “You have to know going in what you really want; because you can’t have it both ways. If you go into high impact venture-backed entrepreneurship; you’re trying to build a business that’s going to scale and make people wealthy. And you’re not going to be your own boss for long. Whereas a small business entrepreneur wants salary security and to be their own boss. So you really need to ask yourself which world you’re trying to be in. Are you trying to be a business owner who’s well respected in the community; has a nice income and runs his own shop or are you trying to create the next Microsoft or Twitter? You have to choose because these are two very different rides.”

2.) You May Have to Move

Did you pick the high impact entrepreneur road? Awesome. But brace yourself — because unless you already live in Silicon Valley; you may have to move.

Jones puts it frankly; “No one ever said life is fair and I’ve written and told people that if raising money at the best valuation fast is your sole objective in life — you probably need to move to Silicon Valley.”

3.) Get On The Team — Even if You Sit the Bench For Awhile

5 Tips for Making It Work as a Part-Time Entrepreneur

1. Find balance. This is what being a part-time entrepreneur is all about. You need to find enough time to start your own business whilst maintaining your commitment to your full-time responsibilities. Spending too much time on your startup venture may cause your full-time job to suffer, which could cause adverse effects such as you miss out on career advancements or potentially lose your job.

2. Be patient.  Being a part-time entrepreneur can be extremely difficult because your business isn’t likely to move forward at the pace you may expect. Often full-time entrepreneurs don’t have enough hours in the day, so don’t be hard on yourself if your business is taking a while to grow. Be patient; you may not be moving as fast as you expected, but remember forward is good.

3. Bank your profits. At some point you will get to the stage where you’re ready to become a full-time entrepreneur. The money you’re able to save now will help you become one step closer to being able to take that next step. Any money you don’t use to grow your business, save it for your future and be prepared to invest it in your business at a later date.

4. Take yourself seriously.

How to Tackle Fear — Tips from a Serial Entrepreneur

Are you a serial entrepreneur or aspiring to become one? In the interview below, Rajesh Setty shares tips from his own life on how to deal with fear and everything else in between from being a novice to a full-fledged entrepreneur. He delivers gold; read on and you’ll know.

Ishita: In all of the different endeavors and positions you hold, what has been your experience with fear?

Rajesh: I don’t consciously think of the role of fear because I’m more of an action person. To me, it’s like the arcade game where an animal pops up and you hit it with a hammer. That’s how I think of fear; it keeps popping up now and then. But if you have a hammer, which is in the form of an action, you can whack fear down, and when it pops up again, you keep whacking it down again and again to keep moving.

Fear can make you do either of two things: It can either make you take no action or it can make you take massive action because you are fearful. In the first case, it can only lead to more fear because not only are you fearful of the situation, but you haven’t taken any action so you fear things will get worse. What I’ve learned is that the easiest way to tackle fear is to find out the best possible action to take, because it’s the only thing you can do at the time. Do it with your own knowledge and your network of people to help you.

Ishita: So you almost don’t give fear a chance in your mind?

Rajesh: I think it’s always there, but I am mindful of the attention I give to fear. Because there are only 24 hours in a day, the more time I spend thinking about fear, the less time I have to take action.

Ishita: As an entrepreneur, have you gone through any anxiety during the startup phase of your businesses?

5 Tips to Start Thinking More Like an Entrepreneur

Thinking like an entrepreneur can improve your life and provide a more promising future. However, making adjustments to the way you think is not an easy thing to accomplish. If you want to start thinking like an entrepreneur, you’ll need tips and tricks to help you accomplish that goal. Entrepreneurs are motivated individuals that follow their dreams and attempt to achieve financial success on their own. While improving your finances and getting rich is one of the more promising benefits to thinking like an entrepreneur, there are many other benefits as well. Entrepreneurs are typically happier with their lives and have better relationships with friends and family members.

Strive for maximum efficiency

Being efficient in all areas of your life is very important. If you want to think like an entrepreneur, then efficiency should be your main focus. Being efficient doesn’t just apply to your work life either. There are ways to be efficient at home, in your relationships, and with your day-to-day activities. If you can come up with good ideas to make your life easier, you’re on your way to achieving maximum efficiency. Furthermore, don’t hesitate to fix things that you know have problems. Have you always wanted to renovate your kitchen? Do you want to make your wife happier and surprise her with a special gift? Would you like to spend more time with your children? Entrepreneurs drop all of their excuses and they get things done without complaint.

Focus on improving the bottom life

Return on investment is something you will hear consistently throughout your life. Businesses are always trying to improve their ROI and entrepreneurs are too. You should always be focused on improving the bottom line and taking your business to the next level. Every entrepreneur has a different way of handling this. If you’re a statistics buff, you may want to run your income and expense numbers in your head. If you are more of a visualizer, then try creating a graph or pie chart. Visual aids can be very handy when it comes to gaining perspective on an ROI.

Think like an outsourcer

Top Tools To Fund Your Startup

Taking your business idea from dream to reality is a road paved with blood, sweat, and tears. If you’ve heard stories about overnight crowdfunding success or multi million dollar investments and are planning on coasting on your product or idea’s storyline, you might as well pack up and go home now. Ideas take money to move from that imagination to reality, but more importantly they take time and effort. The opportunities to gain funding for your brand are definitely there, but it’s important to keep in mind that there is no overnight success without hard work.

If you are ready to fully commit yourself to the funding process, we have provided a list of top tools to consider for all stages of investments.

Personal Connections

Dear old Mom and Dad. What would we do without them? Many startups just need a confidence investment to give them legs and show the rest of the world what they have been missing out on. When you’re working out of your garage, its hard for others to take your vision as seriously as you do, and sometimes you just need a confidence vote from your close friends and family to give your idea the jumpstart it needs.

Avoid fundraising empty handed. Try drafting up a simple proposal of your business, with screenshots of your product and website, and adding some simple statistics. This will give your request a bit more validity, even if you are just pitching to your parents.