Small Business

Capture a VC

How to pitch an investor

Written by Deena Waisberg

Find a friend

Top VC firms receive hundreds of investment proposals every year. They’re more likely to pick up the scent of a pitch accompanied by a referral from a consultant or CEO who has done business with the VC before. If you don’t know anyone, examine the VC’s portfolio, suggests Robert Hickey, Toronto-based managing director of Deloitte Corporate Finance: “Perhaps there is a CEO at a complementary business you could get a referral from.”

Target your pitch

Focus your efforts only on those VCs who invest in your sector. And never ask a VC to sign a non-disclosure agreement — they won’t even read the proposal.

Know what they want

Rick Segal, partner in Toronto-based VC firm J.L. Albright Venture Partners, says he prefers e-mail to snail-mail submissions, but advises against overuse of colors and graphics that slow onscreen reading. Regardless, stick to a one- or two-page executive summary of your business that briefly explains how your product or service provides a solution to a problem and, of course, how it will make money.

Follow up

VCs are very busy people. Inquire about the status of your proposal via e-mail, which better allows the VC to return the message at his or her convenience than a phone call.

Sell your people

If your summary makes the first cut, the VC will want to see more detailed information, including a business plan, a financial model with projections, marketing information and, most important, resumés of the management team. “Most VCs have seen good opportunities disappear because a management team doesn’t execute the plan well,” explains Vince Krynski, partner in Calgary-based Foundry Ventures. If the VC likes your plan and your people, there’s a great chance he’ll call you in.

© 2004 Deena Waisberg

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