Venture capital can be a critical component of an entrepreneur’s growth plans if you want to build a really big company quickly. Most venture capital firms, however, tend to prefer to fund companies who need expansion capital instead of startup capital. They want to see that you have done it before, have proven yourself in one market, and are now ready to tackle a new territory.
Why do venture capitalists love these kinds of deals? Because they are not as risky. It is a lot safer to go with someone who has already generated results on the assumption that they can do it again than to take a chance on someone who is just getting started and has no track record of success.
So what do you do if you are a young entrepreneur and do not yet have the experience of building up a big company? Turn to the venture capitalists who like early stage companies.
It takes a special type of venture capitalist to fund startup companies. From 2005 figures, here are the top 12 venture capital firms who are most likely to give you a shot:
- Maryland Technology Development Corp. – # 2005 Startup Deals: 23
- Draper Fisher Jurvetson – # 2005 Startup Deals: 17
- Maryland Dept. of Business and Economic Development – # 2005 Startup Deals: 14
- Kleiner Perkins Caufield & Byers – # 2005 Startup Deals: 11
- U.S. Venture Partners – # 2005 Startup Deals: 11
- Accel Partners – # 2005 Startup Deals: 8
- Band of Angels – # 2005 Startup Deals: 8
- BioAdvance – # 2005 Startup Deals: 8
- New Enterprise Associates – # 2005 Startup Deals: 8
- North Bridge Venture Partners – # 2005 Startup Deals: 8
- Redpoint Ventures – # 2005 Startup Deals: 8
- Sanderling Ventures – # 2005 Startup Deals: 8
Evan Carmichael
Matthew Toren is an Award Winning Author, Serial Entrepreneur, and Investor. He Co-Founded YoungEntrepreneur.com along with his brother Adam. Matthew is co-author of the newly released book:Small Business, Big Vision: “Lessons on How to Dominate Your Market from Self-Made Entrepreneurs Who Did it Right” and also co-author of Kidpreneurs.
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