more-arw search

Q&A Forum

Finding Venture Financing in the Double Dip

I am with an early stage start-up that will be looking to raise capital in the next 6 months.  We completed a Series B round 9 months ago when there was a sense of things starting to recover.  With all the market volatility do you think I will be able to get a deal done or will VC's and PEGs be tightening up??

Answers

Bryan Frey
Title: VP Finance/Corp Controller
Company:
(VP Finance/Corp Controller, ) |

Actually, I am hearing the opposite - that venture activity is picking up again for later stages. However the market bump we just had may have some negative impact on that. VC/PEs still have a lot of money they need to put to work. As usual, the challenge will be in convincing them that you are the right investment for them to make. If you are hitting your numbers you will stand out in the crowd of companies just drowsily humming along. If you are part of the latter group, you will have trouble b/c, as you know, there is a higher bar in the Valley and NYC for all early to mid-stage investments these days. They expect more customers, more revenue, more traction on the road to profitability.

Topic Expert
Joan Varrone
Title: CFO
Company: Cloud Cruiser
LinkedIn Profile
(CFO, Cloud Cruiser) |

I attended a PE conference yesterday and the PEG's have a great deal of money to put to work. This results from the fact that during the credit crunch they did not do many deals due to lack of leverage in the market. That apparently has opened up. However, private equity is looking for companies which have positive EBIDA (in order to service the debt)

I agree with Bryan that your key to raising funding is your performance; I have found that they are less willing to take risk (why is called venture capital) and are looking for traction and proof points.

1000 views
Topics

Get Free Membership

By signing up, you will receive emails from Proformative regarding Proformative programs, events, community news and activity. You can withdraw your consent at any time. Contact Us.

Business Exchange

Browse the Business Exchange to find information, resources and peer reviews to help you select the right solution for your business.

Learn more

Contribute to Community

If you’re interested in learning more about contributing to your Proformative community, we have many ways for you to get involved. Please email content@proformative.com to learn more about becoming a speaker or contributing to the blogs/Q&A Forum.