In the run of #shake15 conference, I attended a great presentation on venture capitalist myth and reality. The experienced entrepreneurs presenting, Michel Athenour (multiple founder) and Christophe Raynaud (VC ISAI director) made a great team show, spread with humor, irony and valuable real life experience. For people not familiar with the french VC landscape, you should know that France VCs invests 8.7 reasonable billions of euro in 2014, and is made of several tenth of VCs firms, with a recent increase of players.
— virginie galindo (@poulpita) June 29, 2015
The tone was quickly given by those (smart) guys. VCs are scarce.
And you should talk to them only in specific situation. When you are in hyper-growth and terrific expansion, when you are rich enough to pay your team salaries during 6 months (at least), when your team is balanced and great (this is one of the assets VCs will weight careful). If you can’t tick each of those boxes, try something else. Love money (your friend, lover, father, crazy uncle). If you tick all the boxes and wanna go VC, be ready to suffer. The mission of VC is about investing, giving money. Thus, they need to check few things, they need to trust you, your business model, your potential. And they will be looking for your weaknesses, asking the questions you dont want to hear, opposing competition you did not foresee… this torture will be iterative. Meet, talk, present, again. It may take you 3 months, long 3 months where you business will have to rock anyway. So provisioning energy and money for that specific period is a must. That was for the general aspects on when to go VC or not.
In addition Michel and Christophe shared some common sense tips for going VC.
Build your network in the VC jungle. You must have friends there, and it is normal usage to sanity check their reputation, identifying bad sharks and loosers (dont feel ashame, they will do the same for you and your team).
Be prepared to present your activity. This means training, working your presenting and convincing skills.
Think instead of VC. What is it that they want ? Make sure they can make money by reselling your activity. Look for your next acquirer, who will buy you soon, and tell them.
Accept that VC is not for all. And not successing when going, or not going is not a failure. This is just being reasonnable and playing in the relevant category. Again the press is puting a lot of emphasis on champagne, “paillettes” and successful fundings but this does not represent the average entrepreneurship story.
Thanks again to Michel and Christophe for this fruitful workshop !
Note2 : #shake15 learning related to e-commerce is also available here.