Sánchez-Ocaña Alejandro Suárez. TIME-sector employer since 1998 CEO of the Group Publispain, the network of blogs Entertainment Networks SL and Leisure Blogs, Chairman of Inversora Foley, Director and Founding Partner of Yes.fm, advisor and investor in several companies in innovation, new technologies and internet.
Perfect for the investor
If you are riding a startup or want to do and your goal is to entice a private investor (Business Angel), there are some things you should consider. Unfortunately for investors and entrepreneurs speak different languages and sometimes have different reasons. Perhaps that's no longer just a healthy exercise, but it is also necessary to put themselves in the shoes of an investor. See what type of investor is mentally and validate beforehand whether that profile is einversor d we need and can bring to our project.
There are many occasions when the entrepreneur sees his project as his work, his son. From the outset we can not ask an investor who sees it that way. I acknowledge having spent several times since that prism, and that, what is clear is that I am a good investor. For the good investor your project is just a business opportunity. Even being able to go further if we are talking to a business angel involved in some companies in the ICT sector, may see it as a business opportunity and also see some synergy, but never have-or should-have that sentimental attachment to the entrepreneurs often have with your child.
In this double language, now more than ever recommend taking into account the following items when meeting with an investor, ultimately, understand and speak your language:
-- Many entrepreneurs are obsessed with the concept of "success" while investors expect to hear the term "exit", you write like that, and are very different. The entry of a Business Angel is not directly tied to a company make direct or social success, but the medium term to have an "exit" of generating investment returns. They must have market in Spain for that company and should create value (yes, even losing money).
-- The crisis has caused little money and natural selection. Some friends (including a fairly powerful computer) with a Business Plan, rarely attract investment. We need a prototype that demonstrates not only bands you can do. There is so much competition among investors to get below a Business Plan with nothing but a. Pdf and a pleasant face. Against the crisis team and prototype.
-- An investor always like your project. When you say "I see you next year, or want to see more progress, because I like" what you are saying is "now or I put money kidding, shows that you know go" (ie, put up a prototype and shows that you pull forward). An investor is often not close doors.
-- One of the things that are rarely seen in a negotiation investor-entrepreneur, the entrepreneur is to deliver a clear analysis of the market in which buyers consider to be a startup in the future, why and economic parameters. The entrepreneur often does not think about it, and the investor always does. If you've done this work proves to be in the same boat.
-- Believe me, investors like to think that entrepreneurs do not want to be at all costs in your project and understands that it is a stage. Recently, a venture capital fund as an exceptional asset heard mention "the objective of the entrepreneur, is 3 years with the work done away with us and have their reward." They were surprised and were very positive that the entrepreneur did not stay in "my treasure ..." and understood the game of the Venture Capital and wanted to accompany them on the.
-- A private investor puts his money. That is very important, most venture capital funds play money from others, money managed they also have to gamble and bet on whether or if. The difference is enormous. Input most private investors bet on not spending more than 5-10% of its investment portfolio and always try to have at least 5-6 investments to diversify risk. What does that mean?. That if you ask a business angel for example € 500,000, you're thinking you have to bet on companies several million Euros and a brutal heritage. It is rarely the case. Try to be reasonably consistent with the economy who treat them.
-- There are several types of investors. Remember that if you choose one you have to adapt your on and not vice versa. There are investors sentimental, pseudo-entrepreneurs, and other distant the contrary they say "the entrepreneur is you, get life, and if possible, give me back some day the money with profits. " You know who try and then not take their hands in their head and try to remember that "A foolish man will always be stupid. A rich fool, always be rich "have to be practical.
-- In Spain, a critical question always is, "If there is room for 1-2 companies of this kind, how do I know that winning company are you?". If you can not answer or are not secure and direct tremendously with that, unlikely to meet investment.
-- The discussions of valuation are sterile. No company is worth 3 million pre money without prototype and the first sale made, so if you always think you are crazy or you're a dreamer. I must say that I see with these valuations Business Plan and nothing that justifies them very often. Before discussing whether you kidding me or not, in those cases I think it is reasonable and intelligent thinking that the value is not important and think that money is necessary for success, not that I think my company is worth because I'm worth.
No more cruel than another entrepreneur to load your startup valuation. We must always be consistent.
-- "Rich or King?. (one of my favorite quotes says Carlos Blanco) This is an entrepreneurial approach. The private investor raises questions not so obvious. For the investor there is only rich, the kings of the Magi and Christmas. Sorry, may be unromantic, but it is real.
Tags: business angel, investor, business plan, start up
26 Comments to "Perfect for the investor"
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[...] This post was mentioned on Twitter by Javier Martin and FkieCarrero, Rankia.com. Rankia.com said: RT @ loogic: Perfect for the investor http://bit.ly/3nNiOp [...]
What a good post, Alejandro! The enterito subscribe!
Alexander, this post I think of the book, is well understood, I think a good idea depends on how it implements and depends on external factors and the level of funding may come to nothing, become a self-employed business (which is misleading to the investor is looking for investors), generating a product or service that complements well with other larger companies and more opportunity to exploit it commercially in massive plan, or become a super-listed.
In my industry, communication technology platforms is difficult with Spanish funding levels to make a mega-reach, no way to make big free trials of 2 years in a lot of carriers around the world without billion. So the goal must be clear, do some "pieces" to do something innovative, getting sales on the product, these sales are turned into, and that a larger company see your technology as applicable to their customers and door entry to any customers who do not. This may generate a success in 3-4 years to compensate the investor and the bad life of full-time entrepreneur
However, there appear the "theoretical classroom" (in Spain really is overpopulation of them) saying it is a speculative mentality, so in Spain can not be big business, etc etc.. All this said from intermediate positions of companies that are not early adopters of what makes a Spanish start-up, or direct staff, the point of step into the shoes of another does not take much. I personally have on occasion been reprimanded by someone who worked at a technology park from 8 to 3, which criticized the short-term mentality of the Spanish technology emprendores not want to risk creating a Cisco or Microsoft Spanish. To say that success is to gain for the investor and for one even if not a millionaire was a sin. The entrepreneur has to be like a gladiator, win or perish altogether fun of those who choose to be servants ( "ahhh .... So I chose stability," they say).
As you say, reasonable rates exits must be clear from the time zero.
I think your post is very clear, and that even success is success, if something that makes one interested in a larger company and recognized, and there's a price with a fair (that maybe even requires "liquidation preference "to protect the inverter) that makes the investor and the entrepreneur make money too, although not a superpelotazo, is very good, since the investor is encouraged to continue to invest and the entrepreneur for next" crazy "allows base from a higher confidence, better fund the project and at the same time take it further than when the first plan is based on bootstrapping.
Thanks @ eneko
Interesantísimo @ juan.
the truth is that if there is an issue that deserves a book in Spain, is actually the "theorists of living".
More than any kind of help, I agree that early success makes it move the money and encourages investors to get into more adventures. Nothing worse than an investor with money trapped in several companies
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This post was mentioned on Twitter by tecnologia_org: Excellent post by Alejandro Suarez. It further clarification if you are an aspiring entrepreneur http://bit.ly/2cPpbD ...
Projects with more popularity and success never came forward with a "bussiness angel", this figure is more for projects, or "proyectillos" (eye, with all respect
), I always remember the history of Google for a large project (on the theory of this post, quite true also, a "bussiness angel" never support) after depleting the money from family / friends.
I think the figure is sobredimiensionada Bussiness Angel, and on top in Spain, there are "four" with enough money can do that, because others will not risk their money by "such nonsense Internet." Spain attracts not just at this point (besides the enormous legal obstacles that exist here, but tell that to entrepreneurs like carlos channels had to take your project enterito USA).
Congratulations on the blog. Very interesting
The money is part, perhaps, of the requirements for lifting a start-up, but I would place special emphasis on knowledge and talent of the people who make up the project.
As Chris Hughes:
"On Facebook we never had to raise capital or to call any door, the capital came to us"
As to what they said DRD Hebron, give thanks that we have "four" that we encourage the national scene, but that this would be deader than dead, and I think the figure of Bussines Angel brings more money to contribute know-how or experience in form of mentoring for new beginners.
Among rich or king, always rich, with money you can buy a seat on the monarchy, if you want.
In my country many development studies fail to fight all odds to keep their premises creative rather than economic ones. "Kid, you make money with what you invensor advises, and with that money and will make a game as you want, or twenty."
in that I do agree with you, # third
Alejandro Buenisimo course, of course.
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