Having started a company and about to launch another there is reason to find myself at events and conferences with venture capitalists and other gate keepers to capital. And I have met all sorts, but what it boils down to it is next to impossible to fund raise from professional investors and the best way to get to find people is through quality introductions so start close to home, and as much as you know you invented the best SAS Frombulated Social Media Widget convincing people to give you money that are not your kin is like turning water into wine, and you will still be hit with the response, “How are you going to scale that?” You will also eventually be met with the long no, which is a VC or angel will keep on asking for milestones, and keep putting new ones in place because they never want to turn down the next best thing, but they don’t want to give you money either.
It is a frustrating process and it is a full time job if you are serious about getting cash. And it is a full time lesson in patience, listening to the litany of metaphors that will spew forth. I find dry powder and special sauce probably hit the overused metaphor peak about 6 months back but what they embody still has relevance.
Dry Powder – Cash-Liquid, not erased from the recent rounds of economic implosion and ready to put in play. It’s good to know people have “dry powder” however they are much more risk averse about putting it into play.
Special Sauce – Known by name names, but most commonly ‘competitive advantage’, what’s yours and it better be compelling.
One of the most common ways and still one of the most useful ways to define your competitve is to go through Michael Porter’s SWOT (Stength/Weaknesses/Opportunities/Threats) Matrix. Fill in the list and see where you stack up, he also has his 5 forces model, etc. but not here to discuss all of that.
One the good thing’s about being an entrepreneur, or the blessing/curse paradox is that you think you can do things better than other people. You have an idea and through the shear force of will and jackass like persistence you truly believe you will bring it to market. There will be more nos than yesses, in fact, you will here no in more ways than you thought possible and more times than Blake Shelton sings in Nobody But Me, and you will become well versed in every metaphor the VC world is using; perhaps their is an iphone app translator for that but the good news is that everyone is pulling back R&D, good people looking for new things to do, and “(we) have promises to keep, And miles to go before (we) sleep” Keep telling your story, keep moving forward, keep it up. “You’re a rock star, get your game on”