This blog post was previously published on Heather Smith Small Business.
Today I attended a talk hosted at the River City Labs entitled Venture Capital, Fundraising & Founders – A Silicon Valley Perspective.
I have wanted to attend an event at RiverCity Labs for a while so glad I finally got the opportunity. RiverCity Labs is based at level 2, 282 Wickham Street, Fortitude Valley. Startups can hire desk space at the labs for $350 per month ex GST; you might even be able to negotiate a day rate.
The presentation area was created to the left of the venue with temporary walls barricading us from the ‘entrepreneurs’ whom sat at their desks busily innovating.
As I arrived I met @MaddyVeenstra, Co-Founder of @Wikifashion in the lifts, and when we entered the event realised we were in the minority, I estimate only 5% of the audience was female.
Here are a few of my takeaways from the event:
We heard from Richard Horton a lawyer from DLA Piper the #1 law firm for venture capital. Horton spends 2 weeks in Silicon Valley and 2 weeks here in Sydney. Horton was very focused the belief that your business must have a presence in US if you require funding. He felt venture capitalists want to invest in people they can drive to, which seems ridiculous in this virtual world! For an entity, with two founders, to be set up in the US, the minimum legal fees are around $5000. If you are looking to go to the states, the tip was to apply for an E3 visa.
Horton commented that there is an explosion of Australian incubators, but we have unsophisticated angel investors, and need more experienced entrepreneurs.
In 2012 the Venture Capital money is investing in social media social commerce and cloud computing.
Venture Capitalists get 10,000 biz plans a year, so when submitting your business plan in the hope of acquiring funding it must be the best it can be, absolutely polished. It should contain:
- Executive summary
- Management overview
- Technology description
- IP position
- Market position
- 3 years of projected financials (the audience murmured at this suggestion)
- Financing requirements
Australians have a mind set about bootstrapping their businesses and growing them organically however they will be overtaken by competition. Sophisticated entrepreneurs bootstrap business operations, however realise they need to raise funds to move quickly.