Contrary to the common belief that Southern California "should be an easy place to raise money" with all of its' entertainment and real estate wealth, it is a very difficult place to raise Venture Capital for technology start-ups. The bulk of all professional Venture Capital is managed out of offices based in Silicon Valley and most of these fund managers like to invest close to home (except MHS Capital). To make matters even more difficult almost 90% of VCs based in SoCal in 1999 are now gone while our beachhead entertainment companies have a terrible track record at making early stage investments and now typically wait to invest in later rounds.
So how does an entrepreneur based in SoCal get the attention of VC funds today? Over the last ten years I have seen hundreds of entrepreneurs raise VC funding and I have compiled a top ten list of attributes for companies raising Venture Capital in Southern California.
1) The team is articulate, polished and focused in their delivery of their value proposition
2) Frugality reigns supreme and founders have bootstrapped the product development
3) Founders are thought leaders with relevant engineering and marketing domain expertise
4) Founders have chemistry and have established culture with their investors and employees
5) Company has paying customer references with high gross margins
6) Word of mouth marketing and industry references are working
7) The market is still somewhat undefined and growing rapidly
8) Pain relief creates incremental revenue or cost saving opportunities for customers
9) Founding team is raising money through their own personal networks or referrals
10) Company has a clean capital structure and the founders have personally invested
This chart alone should tell you how much impact the Federal Reserve has on the overall economy. The Fed can obviously influence banker...
A stealth internet advertising / publishing renaissance is quietly happening in Southern California 10 years after the dot com bubble ...
Angel investing in startups is probably the most challenging form of private equity there is. Having been involved with the Tech Coast Ang...
Google Removes Its 'Last-Look' Auction Advantage. The "last-look" advantage Google’s ad server gave to Google's a...
Why are Australia and New Zealand bound flights taking off to the East at LAX between 10pm-12am and sometimes later? Loud low flying plane...
This is a story of my first channel crossing on a paddleboard in the Catalina Classic race Sunday, August, 29 2010. 32 miles of open oc...
The Western Conference NHL has clearly been beating up on the Eastern Conference in the first 22 games of the season.
Map of Google search terms on election day: Long wait times, provisional ballots, inactive voter status, voter intimidation, voting machin...
Link to Map
A Baseball Diamond On The Beach in Santa Barbara? Wow!