business success
I attended an MIT Venture Capital (VC) panel event which was held at Softlayer Technologies, Inc. this past week.  Softlayer Technologies, by the way, is an IAS (infrastructure as a service) company that was purchased by IBM for “an undisclosed amount”.  Well, needless to say, the amount was good for the Softlayer shareholders.

During the networking portion of the event, I met a passionate entrepreneur.  I introduced myself, giving him insights into Thought Ensemble and how we differentiate ourselves from other consulting firms as well as telling him about Kinequity Group, the investment management firm that I am with. He then tells me about himself and how he’s developed a very interesting mobile application. Currently, he’s found himself in a difficult position that many who are trying to start a business find themselves in. Though the working application is nearly developed, he’s exhausted his resources, specifically available capital since he has been funding this venture with his own money. 

After a few minutes of chatting, he asked, “Since you are in the investment community, how do you think I should approach a VC company?”  Well, my response was that (1) I am not certain I know enough about the business to really give a fair response to that question, (2) I do not believe, based on his introduction of the company, that he is ready to approach a VC or even an Angel Investor group and (3) I honestly told him that based on our ten minutes together, I would recommend that he polish his business plan and understand the market who will use his mobile application.  I do believe that his idea and efforts can impact mobile phone users in a positive way, and I wanted to ensure that he does not get ahead of himself by introducing this to the VC or Angel Investor world before it is ready.

We decided to meet this upcoming week to walk through his mobile application, business plan, market analysis, etc. in efforts to help him and bring more polish to his approach and messaging prior to moving forward.  From here, I may introduce him to a few local angel investors to help with what we will call “seed” money for the sake of this discussion. After that, if it makes sense, the next step may be to present to some local VC’s but before I get too ahead of myself in next steps and what might happen, let me meet with him and see how it goes.  
A standard piece of advice I give and practice, is to float a business plan and idea by trusted people in your network before trying to go “big” and find VC’s to speak with.  It is not easy to get in front of these investment groups as they may look at hundreds (or thousands!) of business proposals regularly. You will want to ensure that yours is polished and that they are the correct audience for your offering.  AND, always seek a way to get an introduction as opposed to blindly sending forth an offering to a VC group as that simple PERSONAL introduction may be the difference between getting someone to quickly glance at your documents versus reading the content thoroughly and providing a response.
Stay tuned for updates on how this unfolds!