Who are the successful entrepreneurs who have been awarded venture capital funding? Are they just lucky? Did they hit on a timely idea? Were they well connected? Was it a combination of all three?
Neither luck, a great idea, nor networking is dependable enough to set an entrepreneur apart from the rest of the pack. Instead, here are three “p” qualities that an entrepreneur needs to assure at least a modest chance of acquiring venture capital funding.
How will you get your startup company ready to be shown to venture capital firms? The most likely candidate for VC funding is an entrepreneur that is well prepared. That means getting everything in order to make an investment choice easy for start up financing.
Get your business plan written and polished. Show that your market is poised and receptive to your new product. Practice your VC funding presentation over and over so it’s ready to go at any time. And most of all, prepare to be committed to your own project. Entrepreneurs who have an attitude of, “let’s just see if it works” will not be very successful at securing venture capital funding.
A smart entrepreneur will have a strategy for positioning his or her start up business for the right venture capital firm. You must understand that there are thousands of venture capital firms ready to invest in thousands of different types of start up businesses. That means you must have a product that is tested and primed for a receptive market. You must assemble a top-class management team. And you must know which VC firms who are good candidates for your type of business. Get your start up positioned correctly, and finding a VC funding firm will be much easier.
Those entrepreneurs who give up after the first rejection will not succeed. However, those who persevere and understand that the next opportunity might be the right one will be the ones to take home the VC funding. You must be willing to put in the time and energy necessary to get everything just right. Make adjustments. Reposition. Re-assemble management teams. Do what you need to do to persevere and make your start up the right choice for a VC firm.
Venture capital funding is not an exact science. However, past experience shows that entrepreneurs who possess these qualities have a better chance at venture capital funding success.