How VCs select investments

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The process of selecting a startup by the VCs is usually a black box for most entrepreneurs. Its very important for them to understand how all this variables play for or against their idea.

How VCs select investments

  1. 1. BARCAMP BA 2012VANESA KOLODZIEJ @VANESAK VANESA@NAZCAVENTURES.COM
  2. 2. • Early stage VC fund.• Aims to transform local startups into regional/global players.• Based in Santiago, office in BA.• All limited partners are entrepreneurs.• All 5 general partners are entrepreneurs. @VANESAK VANESA@NAZCAVENTURES.COM 2
  3. 3. • Invests in early stage tech startups, $250k to $750k.• Focus in mobile.• 2MM fund size.• In operation. 1 legacy investment, 5 new investments.• Invests in early stage tech startups, $250k to $750k.• 21MM fund size.• Operative March 2013. 3
  4. 4. MANAGING PARTNER PARTNER PARTNER PARTNER PARTNERStrategy Dealflow Expansion Public Affairs Corporate Affairs @VANESAK VANESA@NAZCAVENTURES.COM 4
  5. 5. • Founded 7 companies, exited 3.• Did 2 LatAm roll-outs.• Participated in 1 IPO.• Invested in10 as angels, exited 2.• Founded the first LatAm accelerator, Octantis, Santiago, 2005.• Created 1 entrepreneur program.• Directed 2 entrepreneur NGO. 5
  6. 6. @VANESAK VANESA@NAZCAVENTURES.COM
  7. 7. • Huge markets or profitable niches.• Competitive advantage.• Business + Sales + Tech.• Recurrent revenues.• Economy of scale, extrapolation.• No capital expenditure. @VANESAK VANESA@NAZCAVENTURES.COM 7
  8. 8. • Management team: experience, vertical, complete team, urgency, values.• Equity: % by entrepreneurs, % not in the company• Sales (if any), traction (if relevant).• Revenue model, diversification.• Copy cat, tropicalization, original.• Growth potential.• Expansion strategy. 8
  9. 9. • Market size.• Market growth.• Market “hotness.”• Time to market.• Number of competitors.• Own portfolio, other funds portfolio.• Exits: time, value and buyer. @VANESAK VANESA@NAZCAVENTURES.COM 9
  10. 10. • Fund Philosophy.• What are the General Partners experience.• Which level rounds they do.• What companies in their actual portfolio.• Where in their investment cycle they are.• How many partners they have, how many investments they’ve made. 10
  11. 11. • How much money the company needs.• How much money they will need next.• Who are the previous investors.• Who are are the current co-investors.• Who can fund it in the next round.• % owned by previous investors.• % wanted by new investors. @VANESAK VANESA@NAZCAVENTURES.COM 11
  12. 12. @VANESAK VANESA@NAZCAVENTURES.COM

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