Venture Capital: What are the eight stages of VC financing?
Helping founders make sense of the venture capital process.
Who is a venture capitalist?
Venture capitalists sell money. Their job is to sell their money to very high growth businesses in return for an equity stake in that business. This is a simplification of the venture capital dynamic, but the critical aspect is investing in the right businesses. If they don’t do that, they won’t manage successful funds.
How Venture Capital Works
The breathless media reporting of venture capital deals is unhelpful to entrepreneurs. It over hypes the good and the bad. As a result, first-time entrepreneurs tend to overthink raising venture capital. Raising capital requires hard work and focus but provided you are running the right type of business your odds of raising it are actually pretty good.
Many of the problems and frustrations entrepreneurs express tend to be driven by a lack of understanding of venture capital and how the industry works. The way the industry makes money is unusual, and these unusual dynamics drive how it works.
Venture capital is only suitable for a small number of people and businesses. Historically the industry has done a poor job of communicating how it works and what businesses it is right for. There are lots of very good, productive businesses that just aren’t right for venture capital investment. This is where many of the problems start and why the aim of this document is to demystify venture capital.
Raising venture capital for one of these businesses will be difficult and time-consuming if it can be done at all. The relationship between the company and the investor after investment is likely to be even more difficult. At heart, because the relationship will be based on a misunderstanding.
In Dragon Argent’s Demystifying Venture Capital Whitepaper, you’ll receive clear, pragmatic guidance how the VC business model operates and the 8-step process of raising investment to give you the tools to navigate any future fundraise successfully:
PART 1: WHAT IS VENTURE CAPITAL
✔️ The Industry
✔️ The Behaviours
✔️ The Money
✔️ The Business
✔️ What is VC Designed for?
✔️ Is VC the Right Choice for You?
✔️ Investment Round Structure
PART 2: RAISING VENTURE CAPITAL
✔️ Step One: Preparation
✔️ Step Two: Documentation
✔️ Step Three: Approach
✔️ Step Four: Initial Meeting
✔️ Step Five: Second Meeting & Beyond
✔️ Step Six: Heads of Terms
✔️ Step Seven: Due Diligence
✔️ Step Eight: Post Completion
This whitepaper will make it far easier for you to decide whether venture capital is right for your business. And, if you decide that it is right, will make the fundraising process far simpler.
You can access the White Paper by clicking the link below.
We hope this proves a useful resource in positioning your business for growth and please contact Dragon Argent directly by scheduling a discovery call if you require any further support or specific advice on any of the considerations covered.
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