Hiring the best freelance Venture Capital specialist
A freelance venture capital specialist is a professional who is skilled in the aspects of raising venture capital for startup companies. They have expertise in conducting due diligence on potential investments, crafting pitch decks, and negotiating deals. This is why it’s essential to hire the best in the industry when you want to start a business.
Why hire one a freelance Venture Capitalist specialist?
The main reason why hiring a freelance venture capital specialist is essential when starting a business is because these professionals have the know-how in securing venture capital for startups. This means that they can help entrepreneurs to find investors who are interested in investing in their business ventures. If you choose to hire them, they will provide strategic advice on how to develop your business idea and raise capital for your startup. They also work with existing companies that are trying to raise more money or financing by working with venture capitalists or potential investors.
What should you look for when hiring an independent VC consultant?
When looking for an expert in the field, here are some of the qualities that you need to look for:
High level of experience. When running a business, the knowledge and experience of the venture capital specialist is important, and this is why it’s best to find one who has several years of experience.
Proven track record. If possible, find someone who has a proven track record in bringing investments to companies and startups. The best way to check this is by checking out his portfolio and asking other business owners if they’ve had any kind of encounter with the person or if they’ve heard about their work before.
Strong working relationship with investors. Having a successful working relationship with investors is also another important aspect to consider when looking for the best freelance venture capital specialist. They will also refer your business to potential investors which can help you to gain traction and build traction once you have found a group of investors who are interested in helping you launch your business.
Proven ability to help entrepreneurs succeed. This means that they have the skills and know-how in helping entrepreneurs to secure investment, whether through finding investors or finding a suitable company. By finding people who have been successful prior in their venture capital raise will help you create a better prototype and pitch deck that can persuade VCs about their vision for success.
Contacts with other professionals. The best freelance venture capital specialist is someone who is well-connected with other entrepreneurs, business owners, and potential investors. This is because they can refer your business to other similar businesses that are interested in funding startups or growth companies.
Proficiency with technology. Technology has become an important part of our lives today, especially for businesses that want to take advantage of the internet to grow their company’s visibility through digital marketing. The freelance venture capital specialist should have experience in crafting a digital strategy for growth companies based on their strength, core competencies, and business objectives.
Sharp analytical skills. Analytical skills are the foundation of everything professional services firms do. For a freelance venture capital specialist, they can use their analytical skills to analyze and understand your business and then find the right investors that will be interested in funding your startup business.
Experience in raising funds and securing investments for startups. With their experience in bringing venture capital to an existing business, they will become knowledgeable about what’s needed to secure funding for start-ups. They know how to conduct due diligence, develop a strong pitch deck for financial backers, and craft the right business plan for investors who may want to fund your startup.
Familiar with different investment strategies. Having an understanding of different investment strategies means that they have the expertise in understanding which venture capital firms are good fits for your business. They also have the knowledge of different types of business financing, be it angel or venture capital, and understand how to distinguish between each type depending on the stage of your business.
Proven ability to help other companies at startup stage. Other startups may need their help in securing funding for their companies because they are trying to start up a new business idea. They can be helpful in helping other startups identify interested investors or potential investors who are willing to finance their projects by working with them.
Skills in building relationships with potential investors. It’s important to have a strong working relationship with potential investors because this is what will help you get the coveted funding that you’ve been looking for. They will understand what it takes to get a deal, so they can incorporate different elements of your business plans into their pitch decks and business plans in order to secure the funds that you require.
Tasks of an independent VC consultant
This article will walk you through the basic skills required of a VC consultant, what they provide, and when they are most often used. It will give you insight into the world of venture capital so that you can make better decisions for your company’s future and work more effectively with a VC consultant.
Venture capital is a business, and like any other business it should be run like one. But within the world of Venture Capital we have developed a highly specialized language; one that includes jargon and conundrums that can sound alien to entrepreneurs and investors alike. The purpose of this article is to contextualize the specialized terms and jargon in the industry and briefly describe what they mean and how they relate to each other.
The fundamental unit of capital in venture investing is the fund, which contains a well-defined pool of capital that has been committed by investors for investment in start-up companies (and spinouts from well established public companies). The size of a fund is usually stated as the number millions (e.g. $10 million), $100 million, $250 million, or $500 million. At any given time there are several funds in existence with different sizes and investment objectives. The current preeminent VC fund is the “super fund” — one that is especially large (e.g. $3 billion), offering unusually attractive terms to investors (e.g. 2-10x returns).
VC funds can come in all shapes and sizes, but what they typically have in common is that they are typically governed by a syndicate of institutional investors who contribute capital to investors who contribute capital to invest in start-ups companies (or spinouts from well established public companies). Usually, the terms of the syndicate agreement, called a “term sheet”, set out the terms and conditions of participation by each investor in a fund. The role of a syndicate member is to contribute capital to an existing VC fund and usually to maintain their current level of investment throughout the life of a fund.
Syndicate agreements vary depending on the type of VC fund, but usually include a fee structure for managing the syndicate as well as terms governing voting rights. The goal is that each investor participates according to his or her own specific needs and interests. For example, an investor may seek a high level of participation in a fund to have a say in directing investments in a particular market or sector.
Due to the pooling of resources in a VC fund, there is significant leverage to achieve outsized returns for investors. Most importantly, there are economies of scale that allow VCs to invest larger amounts at lower costs per dollar invested. In addition, there is also scale involved in investing in hundreds or thousands of start-ups over many years and avoiding the “feeder frenzy” when one hits it big. Typically, a VC syndicate will be structured to allow the fund managers to make large decisions about investments over a relatively short period of time. These decisions can include when and where to invest, when to exit a company and how much to pay investors in an exit. One of the goals in structuring a VC fund is that there is high confidence in the capabilities of the management team and that they have the ability to outperform market expectations over time.
VC funds may also be structured so than the majority of any capital returned is paid out directly to investors (as dividends) and less-than-majority is given back through cash/equity distributions (as appreciation). The structure for this distribution between dividends and appreciation depends on your particular fund.
A VC fund will invest in start-ups in a variety of ways. First, they may be companies that are still privately held, where the investors are the founders and the VC partners who provide seed/angel capital in exchange for an equity interest. Second, there are companies where there has been a company sale (to one person or to multiples) and the management team is returning to investors to raise additional capital for further growth. These can be called “secondaries” for fundraising purposes. Third, there are initial public offerings (IPO’s), where an investor purchases shares of stock in a company so that s/he can invest alongside other investors who want to participate in that company’s success.
Venture capital funds primarily invest in start-ups in the private market primarily for three reasons:
1) They have a longer period of time to identify and work with high growth companies, whereas public markets have more competition from large pools of capital that must be invested over a shorter time-frame. 2) In public markets, access to capital is limited by SEC regulations and disclosure requirements. 3) There is less volatility in the valuation of privately held companies, all else being equal. This can be a significant advantage for VCs who want to maintain a long term horizon and do not feel pressures from investors to exit a company within a short period of time.
Obviously, VCs take a “long-term view” in investing in private markets. In the VC industry, a long-term horizon means that a business plan prepared earlier in time has already been tested by the market over a longer period of time. This is one of the primary reasons that VC funds invest in start-ups for two to five years and then hold on to them for an additional five years or more (depending on the fund). Within this time frame, investors will typically provide additional capital when the company they are investing in shows signs that it will be successful over time. Typically, they will require an exit within this period unless there are exceptional reasons to extend it (e.g. regulatory issues).