Meeting Your Match
Since every VC has his own particular strengths, finding the right match between VC and entrepreneur is important for the ultimate success of the enterprise.
Perhaps surprisingly, given the number of deals each VC declines, the control does not rest entirely in the hands of the venture capitalist. Entrepreneurs are actively choosing their VCs for their particular skill set or industry experience.
Kavita Iyer of Minglebox.com believes she has an advantage in partnering with Sequoia Capital, globally the leading investors in the internet space. “Sequoia has funded the likes of Google, Yahoo and Youtube at very early stages,” states Kavita, “So they have a wealth of understanding in our domain.”
Raghav Kher (Seventymm) too was clear from the outset that he wanted to work with VCs that would help build their business. And he seems happy with the choice, stating that, “Matrix has a lot of connections in India where as DFJ has a lot of connections in Silicon Valley.”
But is the chemistry right?
With both VC and entrepreneur so passionately involved in the enterprise, getting along is just good business sense.
“The most important thing, after all, is if you really like the founders of the company; that you think these people are compatible….it’s just very personal,” Balaji explained.
Kawaljit agrees that the final critical element when deciding to invest in a company rests on “our chemistry with (the team), our comfort with them.”
Till debt do us part
Personal connection is all very well, but money remains the bottom-line – in fact venture capitalists ‘partner’ their portfolio companies in order to promote growth and manage the associated risk. As Kanwaljit explained, “we are responsible to our investors…so in the end it is a financial exercise for everyone around the table.”
Therefore, however personal the relationships, VCs will play hard ball if required to protect their investments. And though Balaji is willing to give the entrepreneur space to a certain extent, he insists on a balance so the entrepreneur “doesn’t go so overboard that he pulls even the existing business down the drain.”
With the view that the end justifies the means, most are willing to do what it takes to ensure success. Avnish puts it succinctly, “If the market opportunity is fabulous and you have a B team, you can always hire an A team.”
Kanwal agrees, “When the business reaches a certain stage of growth, there might be a potential for the company to bring in a different profile of senior management - could be a CEO or COO.”
So when business potential outgrows its founders, it‘s amply clear which horse the VC will back.
Enjoy the ride
All things told, venture capital – for those that fund, as well as those funded – can be a wildly exciting ride. A ride where the ultimate highs don’t just come from the money, but from new ideas. Entrepreneurs live in a world where dreams can come true and if the match is good, VCs can provide just the right help.
As Alok Mittal of Canaan Partners puts it, “We don’t call ourselves venture capitalist as much as venture catalysts, and money is just one of the pieces that go into catalyzing growth”.
More articles on www.nenonline.org. Content provided by NEN
Subscribe to this comment's feed
written by Adelaide Electrical Needs, November 03, 2010
Home Automation
written by Fayetteville web design, November 03, 2010
managed through effective online catalogue with ease and user friendly. This enables you to update your website
with easy to use from control panel. adding, editing and deleting products, managing product images and enable
secure ordering.Fayetteville nc Webdesign
written by ajaysingh19, October 01, 2010
written by ajaysingh19, October 01, 2010
written by ajaysingh19, October 01, 2010
written by ajaysingh19, October 01, 2010
written by ajaysingh19, October 01, 2010
written by rubik's cube, June 18, 2010
want something special, come here
led flashing bracelets, cheap bakugan toys
finger skate, power balance
ddung, barbie girls
led flashing bracelets
organ donor dolls
at http://www.toptoys2trade.com
written by Bindu Rao, December 09, 2008
a) new customers b) new partnerships. I have worked in startups where the VC failed to make a difference in terms of new customers and new partnerships. Their investments were not more than help in paying the bills, and did not make a big difference to the growth of the company.
| < Prev | Next > |
|---|
the rose with its heart and petal system that extend
Celebrate Life