Tag: angel investment

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How to Get a Warm Introduction to an Investor

by Cate February 3, 2015 No Comments

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If you’ve done any research about raising funding for your startup or small business – or, really, if you know anything about human behavior – you’ll recognize that you have a much better chance at getting an angel investor or venture capitalist to write a check to fund your business if you’re able to get a warm introduction to that investor. Assuming you don’t spend all of your free time rubbing elbows with multimillionaires, however, you may have to put in a little work to get that introduction and I’m going to give you some tips for accomplishing just that.

First up, make sure you’re prepared for a meeting before you head to start trying to get meetings. You really never know when you might procure that warm intro you’re looking for and when the investor will want to meet. I’m not saying you need to jump through ridiculous hoops and be available at an investor’s every beck and call, but if you get the opportunity to have a meeting, you don’t want to ask for a couple of weeks to prepare. Additionally, you have to remember that these investors have lives too and care about many things much more than listening to your pitch. If someone says they’d love to hear your pitch but are heading off on a month-long vacation next week and need to see you the day after tomorrow, you should be ready to pitch them the day after tomorrow.

Secondly, be sure you know what type of investor you’re looking for. Most investors, whether angels or VCs, have a sweet spot within which they like to make their investments. That means that they’ll typically back companies in a particular industry, at a particular stage of development, in a particular geographic region, and that need a particular amount of money. Before you go out there networking, make sure you know where you fall in that mix so that you can be clear about who would be good fit for you as an investment partner and who wouldn’t be.

Thirdly, get out there and become a part of the community. If you’re watching this video wondering how to get a warm introduction to an investor, it’s likely that you haven’t really become a part of the entrepreneurship or startup community in your area. These circles tend to be pretty small and it’s pretty easy to get to know someone who could make a connection for you, or to meet the investors themselves at one of the events in your area. That’s not going to happen if you’re never present in the community, however. Whether or not you’re actively seeking investment, you should be out there getting to know the other entrepreneurs in your area, participating in events, sharing your idea, learning from others, and just really committing to being a part of what’s happening on the entrepreneurship scene. This is how you learn, network, and find out about new opportunities for your business.

Fourthly, make use of the technology we have available to us and utilize the networking platforms out there to see who you know that could connect you to someone who might invest. Jump on LinkedIn to look up some of the investors you’d love to work with and you’ll immediately be able to see if someone can make an introduction for you. We have so much more visibility and transparency now than in the past when it comes to others’ networks and you should absolutely make use of that. If you don’t have someone who can make an introduction for you yet, move to Facebook or Twitter and try to find out where the investors you want to meet will be and then plan to attend those events as well. If you continue to participate in the same community in which the investor participates, you’ll eventually meet him or her or at least meet someone who knows him or her.

Finally, be persistent. It may take you a little time to get a warm introduction to the investor of your dreams, but it will be well worth it once you do. Remember as you go through the networking process that there is much more value to building long-term relationships with the people you meet than getting a one-time intro to an investor. The best thing you can do is bring value to the community – share your idea, show off your intelligence and dedication, and most of all, help the other members of the community. An introduction is only effective when it’s backed by praise and you need to have a good reputation in the community in order to get that.

That’s it for this week on New Venture Mentor. Thanks for watching and I hope you found this video helpful. If you did, please let me know by giving me a thumbs up on YouTube and maybe even making a small fan funding donation so that I can keep this channel up and running. If you can’t or don’t want to give, no worries. You should still subscribe to the channel and to my email newsletter over at CateCosta.com to make sure you’re always in the loop on the latest information, tools, and tips to help you plan, launch, and grow your new business.

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Mexico’s Entrepreneurial Ecosystem Interview 4 – Jackie Hyland: Project Analyst, Angel Ventures Mexico

by Cate May 2, 2013 1 Comment

It’s almost time to leave Mexico (okay, by the time I post this I will have already been in Costa Rica for 2 weeks – but it’s almost time for the blog to leave Mexico) but before heading to the airport I was lucky enough to be able to sit down for a coffee chat with Jackie Hyland. She’s a Project Analyst at Angel Ventures Mexico and interacts regularly with both startups and investors, so she has a pretty insightful take on the entrepreneurial ecosystem in Mexico City.

Since Jackie works at an angel fund, our conversation naturally started with a discussion of the investment environment and, according to Jackie, there’s a big gap at that initial seed-stage capital between what entrepreneurs need and what investors are willing to offer. She says:

“There are people who want to invest but very few that want to join in on a company that is at the prototype or even seed stage. [Investors] want to see sales.”

Just like some of the other insiders I spoke to, Jackie says she’s seen a lot of the family business culture and the monopoly culture. While in the U.S. when we think of an angel investor we may conjure images of a serial entrepreneur who’s started and sold numerous businesses, in Mexico the angel investors tend to come from a more corporate traditional background or have run a family business so they’re more risk averse.

On the positive side, however, Jackie says that the investment environment in Mexico is very open, meaning that investors share deals with other investors rather then trying to keep the next hot thing to themselves.

“Between the funding organizations, we want to share what we know,” Jackie says. 

She thinks the risk aversion and openness will change though, and that change process has already begun.  The government is saying the growth of the entrepreneurial ecosystem is a priority for them by creating the new entrepreneurship institute  and the entrepreneurs and investors are becoming more active.

“The movement has started now. There are people saying ‘I don’t need to just take over my Dad’s company or get a job. I can start something,'” she says. “But it will take another 3 or 4 years before people start seeing it’s not just about starting a company, it’s about coming up with something really unique.”

Unfortunately, Jackie sees that increased deal flow leading to less open communication between investors: “I think [funding organizations’ openness] is going to change once the deal flow changes and there are a lot of really hot projects with high value,” she says.

These changes are a part of the evolution of the ecosystem. According to Jackie, just a few years ago in Mexico entrepreneurship was just starting to come out of people’s mouths and now it’s exploding. Now that there are numerous incubators and accelerators that have started, people know about them, and people are in them; people are beginning to try to figure out how to make them better.

“Everyone says this is the prototype phase and now let’s go to phase two: let’s make it better,” Jackie says.

And part of making the ecosystem better is about tweaking the models so that they fit with the Mexican culture and ecosystem. “A lot of other countries want to mimic Silicon Valley: What do they do? What do they have? How do we bring that here?” Jackie says. But in order to truly succeed, the Mexican entrepreneurial ecosystem needs to adapt those models to Mexican realities.

“What I think and what I always ask Mexicans,” Jackie says, is “why do you feel like you need to mimic when you’re bringing something from another culture? Why not try to do more than transplant and see how this model fits with Mexico and make it bigger and better?”

However the ecosystem continues to evolve – as an attempted direct copy of places like Silicon Valley or as something intentionally uniquely Mexican – Jackie says, “the flow will pick up when entrepreneurs say: ‘Okay we’ve been doing this, we’ve been making companies, let’s figure out how to do this better, how to make a big difference.'” Thus, the question of the growth of the entrepreneurial ecosystem in Mexico seems to be one of how and how quickly, not if.

 

Do you have experience in the Mexico City startup scene? If so, please let me know your thoughts on what Jackie had to say in the comments sections below. Next up we head off to San Jose, Costa Rica to explore the entrepreneurial ecosystem in Ticolandia. 

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Tips for Pitching Your Startup or Small Business to Investors

by Cate April 22, 2013 3 Comments

Many an entrepreneur dreams of raising money from a prominent venture capital firm or angel investor, but this type of funding is hard to come by. If your company is suitable for an equity investment and you’ve been lucky enough to land an audience with some investors, it’s important that you don’t blow your pitch if you want to make a good impression and get the funding you need.

Today’s video gives you some quick tips to make sure that your pitch impresses your potential investors so that you can get money you need to build your dream startup.

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Funding Sources Available to Entrepreneurs to Start or Grow a Small Business or Startup

by Cate April 9, 2013 3 Comments

One of the biggest stresses for entrepreneurs can be figuring out where to get the necessary to capital to start your dream business or to grow your existing business to its full potential. If you don’t have a finance background and/or this is your first time as an entrepreneur, you may not be familiar with all of the funding options available to you and choosing the best option for your business is critical to your company’s continued growth and success.

This video will give you a quick overview of the funding options available to help you get started with exploring the best financing for your small business. If you’re still confused and need some help deciding what type of financing is best for your company, talk to a mentor or head to the “Work with Cate” page and make an appointment to speak with me about how best to move your dream business forward.