Personal website of Entrepreneur, Photographer, Writer and Wannabe Geek, Andrew Paradies

How to Raise Venture Capital: The Definitive Guide

Everyone wants to raise money from venture capitalists to build their own ideas. This is a pictorial guide on how to get them to give you that sweet, sweet, kitty cash.

Finding a good idea

you may be naive and believe you have to show a profitable idea or revenue potential. Don't get bogged down with meaningless details. If you get distracted by meaningless details, so will they. All you need is eyeballs. Lots of them.

Don't believe in having to be "original"

Originality is hard. Time is short. Their money needs an extraordinarily high rate of return. They are itching to give their money to you. Pitch them your company - Apple 2.0. Call it ppl20. Vowels are for amateurs.

Insert key buzz words into your presentation

like "web 2.0", "semantic web", "social network", "monetize", "ad revenue". They love this - hey, look around, Facebook's doing it, and so can you.

Setting up meetings.

Calling and emailing is for amateurs. VCs like new - surprise them at their office and pretend that you thought you had an appointment. In the confusion - tell them you'll come back in an hour and that they'd be better be prepared. If you're having trouble, claim the meeting is with someone who has recently left the VC firm.

Dress for success

you might feel like you should wear a suit because they do. But you're not one of them - you're a cool web 10.0 hipster. Show them this hipness with your sweet threads like this skateboarder. Remember VCs will need to know you're too important to even have time to dress up for them.

How much do I ask for?

The amount of money you ask for does not have to have anything to do with what you need to build your business. You may think, I'm making a widget, maybe $1.0M is too much money to ask for. Don't limit yourself - go big or go home - make it $10.0M.

Setting the tone of the meeting

When the meeting starts, impress them by telling the VCs that "web 2.0" is so 2007. Show them how forward thinking you are by drawing a picture of web 10.0

Be Memorable

VCs get pitched 1000s of ideas by 1000s of entrepreneurs. You need to stand out. If you have to, take a cue from this guy. He has success written all over him.

Exit Strategy

apparently Google will buy anything which makes this is an excellent exit strategy. Don't explain why they'll buy you that may just confuse or bore them. Just put the title on this slide as "Exit plan", add in a small "exit sign" picture on the slide and the words "Google" - make sure Google is in its normal multi-colored logo, not its themed ones. The themed ones are for amateurs.



If anyone asks questions about your plan

AT ANY POINT

Tell them "I see that as a post-Google issue".


In fact, this is a good answer for anything they might ask so it's key that you remember this phrase. The last thing you want is to appear to be dodging questions.



And Finally and Perhaps Most Importantly

Be Prepared. It will be hard work to spend all the money you get. Here are a few pointers to get you started:

  • iPhones for everyone in the company
  • launch parties at expensive venues with open bar - think Fenway Park sized events
  • t-shirts with your company logo - clearly a company necessity

With some luck, you can easily get your way through the first million. The second one is harder, but you can always make "strategic acquisitions". If you add crap to crap contrary to popular belief, you get gold.