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Is My Business Right For Venture Capital?
Scott Fox, best-selling author of Internet Riches, tells how to find out if...
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Scott Fox, best-selling author of Internet Riches, tells how to find out if your online business is right for venture capital.
Is my business eligible for venture capital? This is a question I often get at my seminars and radio appearances. Everyone who starts their online business thinks that they should be eligible for the gold rush of money that comes out of Silicon Valley.
Well, is exciting prospect, venture capitalists do have specific criteria that they evaluate when looking at a new business. These include things like the size of the market you’re addressing and the potential for the company to go public. This means if your business is very profitable but doesn’t reach at least a hundred million or even a billion dollars of revenue each year, it’s probably not a good prospect for venture capitalists to invest in.
Another aspect to consider is that by taking venture capital, you’re inviting investors into your business who are essentially your partners, which means that they’re going to be involved in every major decision that you make. You might be better off looking for, what they call, angel funding, which means, talking to friends and family to raise money from those more sympathetic friends before you bring in professional outsiders.
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