Why Venture Capital Financing Is Not Considered Suitable For Every Entrepreneur?

Venture Capital Firm

Venture Capital Firm

A phase that every entrepreneur needs to go through is raising capital for his newly started business. The moment a business idea occurs to him, he tries to convert that idea into reality which instantly screams “I need money Boss!”, and then starts the most challenging process of finding a suitable investor.

There are various methods of startup funding but the one that is considered the most powerful and therefore the most sought-after, is venture capital financing. Venture capital is the money invested by a professional investor, typically a venture capital firm, in supporting those businesses which have a high market potential but are unfortunately not bankable as they involve huge risk. Banks or other financial institutions usually do not prefer to invest in the seed stage startups and that’s where the entrepreneurs turn towards the venture capitalists.

The venture capitalists or the venture capital firms pool money from wealthy people looking to make more money. These firms then invest the money in potential business ideas or at various stages of a business.  They are usually the most sought after as they are willing to take risks, but wait…that doesn’t make venture capital financing suitable for all. There are various factors that determine whether an entrepreneur is suitable for this type of startup funding method or not.

The first requirement is a unique business idea without which no venture capitalist will bother to look at the entrepreneur. A unique business idea means the product/service on offer is unique and is the only solution to a long-prevailing issue. In other words, it is a product or service which the customers are madly looking for. If there’s no uniqueness, the business is not suitable for venture capital financing. Now, this is something that investors will ultimately decide whether they like the idea or not but there is something else that only the entrepreneur will have to think about.

It is his ownership in the business.  If he plans to raise venture capital, he will have to remember that this might require him to share his ownership in the business with the investor (venture capitalists) which is usually around 25 to 50 percent. Not all entrepreneurs are willing to share this asset, so in that case, venture capital is not the right option for them.

However, there are also entrepreneurs who are willing to share a part of their equity with the venture capitalists as these investors offer a lot more than just the capital. Venture capitalists are highly knowledgeable people with an extensive knowledge of the industry they are dealing with. They are masters of finance and have the ability to guide the entrepreneurs with whom they are associated with.

The guidance and sharing of knowledge by the investors immensely help the small businesses and enable them to earn huge profits in comparatively lesser time. So, it all depends upon the entrepreneur whether or not he wants to share his ownership in exchange of such mentorship. The venture capitalists have a strong network. They know influential people in the industry and once they invest in a company, the business benefits a lot from such contacts.
The venture capitalists are usually very choosy. Out of 100 businesses they meet, they might select only one or two and rest of the businesses keep struggling for their luck. This clearly indicates how minutely the entrepreneurs have to think before launching a campaign for venture capital. Without proper planning and preparation, it might just be a wastage of valuable time and energy.

The expenditure associated with venture capital is also very high which often makes it unaffordable for many business owners. No doubt, there are many advantages associated with venture capital financing, it is still essential for every entrepreneur to judge the suitability of the method so as to ensure that he is putting his time, energy and money at the right place.

To know more on venture capital financing, feel free to get in touch with us at http://mergeralpha.com/

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Venture Capital Raising In Singapore

venture capital funding

Venture Capital Firm

Over the year, Singapore has emerged as a favourite destination for the Southeast Asian entrepreneurs planning to raise capital for their newly started business or expand the existing ones. Although there are many other nations like Thailand, Hong Kong, Japan, Malaysia, South Korea, India and China, Singapore has apparently achieved the most mature stage.

Today, there are lots of options for capital raising in Singapore, especially the venture capitalists have started showing significant increase in the numbers. Currently, there are over 100 venture capitalists in Singapore.

The industry is although quite new and small compared to those of US and UK, the venture capital firms are however increasingly getting attracted to the destination due to the tax incentives and other favourable government policies. High net-worth Individuals, corporate houses, government boards and many wealthy people are increasingly coming up to open venture capital funds in the country.

Some of the most active venture capital companies of Southeast Asia are located in Singapore. When it comes to capital raising in Singapore, the venture capital industry offers huge scope to the entrepreneurs. Apart from acting as financers, the investors also serve as mentors for the start-ups.

The start-ups are also constantly in search of such investors who can offer them with ample knowledge, guidance and contacts apart from just the capital. The management skills they acquire from the venture capitalists help them hugely in successfully expanding their businesses.

Typically, the venture capitalists in Singapore prefer to invest in the late-stage expansions. However, many also look for high-potential, early stage start-ups. This preference often makes capital raising in Singapore a bit challenging for the entrepreneurs which is however not an impossible thing to do.

There are various types of venture capital firms like, some who prefer to invest in the established businesses, some who prefer those which have already started earning profits while some who prefer to invest in the early-stage start-ups.

Two more ways in which the venture capital companies in Singapore can be categorised are: the independent limited partnership firms and the corporate backed firms.

The most prominent industries in Singapore that are able to attract the venture capital firms are manufacturing and services industry, and the technology sector which usually include biotechnology, software, genetic engineering, etc. Due to the constant innovations and advancements in the IT sector, attracting venture capital has become much easier for businesses related to the industry.

Venture capital raising in Singapore will become easier once the entrepreneurs fulfil all the requirements. The things that the investors primarily look for are: a unique business idea with great market potential, a highly-organized management team with an excellent knowledge of the current market and competition, a sizable and scalable market, an innovative business model and market benefits of the product/service.

On an average, such investments last up to 2 to 6 years after which the investors expect to see a 25-30 percent return on their investments for each year. Such a possibility of profit earning is only possible with the presence of an extra-ordinarily talented management team where each and every member is aware of his/her responsibilities and is highly committed to the customers and investors both.

Some of the most popular venture capital firms in Singapore are JFDl. Asia, Golden Gate Ventures, TNF Ventures, and Ventures Capital etc.

For more information on capital raising in Singapore, visit http://mergeralpha.com/

Things to Remember While Venture Capital Raising Enough Is Often Never Enough for the Investors

venture capital, capital raising, venture capital fund

venture capital, capital raising, venture capital fund

Of all the types of startup funding methods, capital raising from the venture capitalists is definitely the toughest one. Right from the moment you think of raising venture capital, you have to start preparing for it. Trust these professional investors with the potential to take your business to the highest possible level are often extremely tough to convince.

So, as an entrepreneur, it becomes your responsibility to stretch your boundaries as much as you can to increase the value of your business and make it appealing in front of the investors. Here are some of the important things you need to remember while venture Capital Raising in Singapore.

Choosing the right investor should be your primary target. It will simply be wastage of time if you run after the wrong investor, i.e. one who is not at all interested in investing in the industry you are dealing with. Go through their website properly before approaching them.

First meeting with an investor means the first impression that you are going to leave upon your investors. It should be formal in every aspect, but no need to narrate everything in the first meeting. This should be the day when you will only create curiosity in their mind and when you leave, make sure they eagerly look for another meeting with you. If they seem curious, it means they have found something valuable in your business.

You first pitch should reflect your business in a crystal clear way. You also need to realize that these guys are really busy and do not have much time to listen to long stories. So, make it crisp, clear and professional. In a few sentences, tell them about the whole concept.  Show them how big market you are targeting, how scalable it is and if you have tested your market traction with a group of beta customers, show them.

Prove how and why you are better than your competitors and why do you think customers will come to you. Explain your business model and also discuss about your management team – you can even introduce the team to the investors. Make sure you have smart, hardworking and committed members in your team.

Once you have found a right partner, try to maintain you dedication towards them as they have taken a huge risk by investing in your startup. Always inform them about any latest development or whatever success your company has achieved. This way, you will be able to retain their curiosity as well as trust in your business.

Try to make it easier for them as much as possible to know your business and your team. Encourage your team to act smart and behave properly in front of them. They should never regret their decision of investing in your startup. If it happens, they may feel it unnecessary to continue with your business.

These are some of the most important things that you should never forget while raising venture capital. If you are currently in search of a suitable investor, it would be a great idea if you can be a part of an intelligent network of buyers, sellers and investors. If the idea sounds appealing or you just want to gather some more information about venture capital raising, feel free to visit http://mergeralpha.com/

How to Attract Venture Capital Financing For Your Newly Started Business

Venture Capital Financing

Venture Capital Financing

While there are so many other sources of capital, why do entrepreneurs often look for venture capital financing? Well, that is primarily because of the huge investments made by the investors, also called the venture capitalists, and needless to say, the additional services like guidance, knowledge sharing, contacts sharing, etc. that they receive.
Now, the biggest challenge that businesses often face is attracting venture capital financing. The first thing entrepreneurs need to have is a unique business plan. The uniqueness of the product or service will ensure that there will be great demand for it in the market and it should provide customers with a unique solution that they have long been looking for.

The thirst for this uniqueness often drives the investors towards the technology industry as it witnesses frequent innovations. That however doesn’t indicate that other industries have to suffer but it is again all about how unique the business plan is.

Secondly, they need to develop a value proposition to the investors. This is really important while attracting venture capital financing as the investors are very knowledgeable in the startup industry and expect the entrepreneur to know why and how his/her product/service is different from those of other competitors in the market. Why would customers choose to buy that particular product rather than going to some other vendor? For entrepreneurs, these things have to be very clear right from the beginning.

Further, a highly efficient management team is a must for any startup. A management team full of knowledge, expertise and commitment is like a diamond in the eyes of investors. Apart from the entrepreneur himself, it is also the responsibility of the team to help the business attract Venture Capital Financing.

Targeting a sizeable and scalable market is also equally important. There is no denying that there is huge competition in the startup industry and only a few of the businesses are able to receive funding either from the venture capitalists or the angel investors. In such a scenario, without strong market traction, it is impossible for a business to gain the attention of these professional and choosy investors. The venture capitalists are masters in the matters of finance so they can easily evaluate the value of a business just by going through these factors.

The next vital requirement is a strong network. Just like social media networking has become a rage in the current world, it is important for the entrepreneurs to also become a part of a strong network through which they can reach their suitable investors.

Another important aspect of venture capital financing is, the investors usually prefer to invest in situations where either they are familiar with the entrepreneur or a person from their circle recommends a name (of an entrepreneur). Recommendation mostly works so it is essential for the entrepreneurs to increase their network and get their businesses introduced to more and more influential people.

These are some of the ways in which startups can convince a suitable investor. Apart from this, positive attitude, honesty, commitment and good behavior are also important to ensure that the entrepreneurs perform their best in front of the investors.
For more information on venture capital financing, visit http://mergeralpha.com/

A List of Some of the Top Venture Capital Firms in Singapore Venture Capital Firms in Singapore

Capital Raising in Singapore

Capital Raising in Singapore

Over the last few years, venture capital raising in Singapore has gained great momentum with the emergence of some of the top firms creating new opportunities for the entrepreneurs. If you have a newly-started business, you are well-aware of the importance of capital in its growth and expansion and any clue about a potential investor is always welcome news for you. Among all the Southeast Asian nations, Singapore has currently the most active venture capital industry. In case you are currently planning for capital raising in Singapore, here are some of the top venture capital firms you must know:
•    JFDI. Asia – Sector : Technology

•    Jungle Ventures – Sectors: Healthcare, Ecommerce, Digital Media and Entertainment, Search and Digital Marketing, Tourism. Etc.

•    Ardent Capital – Sectors: Technology, Advertising, Transactional Commerce, etc.

•    Carlyle Group – Sectors: Real Estate, Infrastructure, Energy, Corporate and Private Equity.

•    Intel Capital – Sectors: Digital Media and Entertainment, Software Services, Computing, Mobile, Consumer Internet, Manufacturing Industry.

•    In sight Ventures – Sectors: Internet Marketing, Mobile Application Development, Mobile Gaming, IT Security, etc.

•    Golden Gate Ventures – Sectors: Technology, Online Business, Finance, Mobile, etc.

•    Merger Alpha – An intelligent network of investors, entrepreneurs and advisers.

•    TNF Ventures – Sectors: Telecommunications, Technology, Medical, Eco-friendly Products/Services, Media, etc.

•    Sing tell Innov8 – Sectors: Digital Content Services, Customer Service Enhancers, Next Generation Devices, Network Capabilities, etc.

•    Upstream Ventures – Sectors: IT, Internet, Software Services, Security, Biometrics, IDM and Semiconductors.

•    Stream Global – Sectors: Mobile, Digital Media, ICT, etc.

•    Walden International – Sectors: IT and Software, Internet/Digital marketing, Clean tech, Semiconductors, Emerging technologies, etc.

•    FLAG Capital – Sectors: Real Estate, Energy resources, etc.

•    Gobi Partners – Sectors: Digital Media, Digital technology, etc.

•    JAFCO Asia – Sectors: Technology

•    Extreme Ventures – Sectors: Interactive Digital media, Mobile and Wireless, Security, biometrics, Semiconductors, Internet, etc.

•    Mc Lean Watson Capital – Sectors: Technology, IT, Software Services, Telecommunications, Energy, etc.
Conclusion.
There is nothing like finding and successfully convincing the right venture capitalists. With a unique business idea, a highly-skilled and organized management team, a scalable market, a sound knowledge of finance and marketing and an innovative business model, you can definitely be one of those few lucky entrepreneurs who have successfully taken their business to new heights with venture capital. For more information on venture capital raising in Singapore, feel free to visit our website at http://mergeralpha.com/.

Product Offering of Merger Alpha

Capital & Network – The Biggest Requirements for a Startup

OK, I do realize the excitement of starting a new business and also the phase we all go through in figuring out the most suitable source of startup funding. But unless you have a strong network, finding a suitable funding source will be next to impossible.

If you have a huge amount of personal savings, it might help you in the initial rounds of financing but a stage will come when you will need a professional investor to indulge into your business to help it grow and expand.

So, how about having a platform that can help you take a leap and get hold of a suitable investor for your startup?

Visit the Merger Alpha team – a company based in Singapore targeting the fast-growing Asian market. Merger Alpha is dedicatedly working towards encouraging entrepreneurship in Asia and to fulfill this objective, the company offers an innovative & international platform to bring together entrepreneurs, investors and financial advisors.

How Merger Alpha Can Help Your Business?

To know how Merger Alpha can help you turn your newly-started business into a well-established one, you have to first go through the product offerings of the company. Here’s a list of the products/services offered by Merger Alpha.

  • Develop Your Business 

    you will get access to a common platform which will bring you close to potential investors and buyers. Naturally, your chances of finding a suitable suitor increases greatly. You don’t have to rove here and there and spend your valuable time and energy in search of an investor or a partner or a buyer. Basically, it’s a one-stop destination meant to fulfill the basic and the most important needs of startups.

  • Raise Fund

    you know how tough it is to raise fund for a startup. Convincing the investors, especially the venture capitalists, is as tough as selling fridge to an Eskimo.The team at Merger Alpha tries to make things easier for the entrepreneurs like you. They strive to introduce you to the most suitable investors around the world, i.e. those investors who are interested in the industry you are dealing with.

    Until you get in touch with the right investor, you will simple keep scratching your head thinking why you are not able to raise fund for your startup. By being a member of an intelligent network like Merger Alpha, you will easily get one step closer to your goal.

  • Joint ventures and Partnerships

    You will easily find a suitable partnership company and increase your revenue and profitability. This will ensure that your start-cost is much lower and you have enough capital to grow your business. You can partner with local or cross border companies who are also in search of companies like yours.Through the network, it will be much easier for you to expand your network, your market, products and customer base. In short, your revenues will increase very soon.
  • Stealth Campaigns 

    While you are looking for a suitable investor for your startup, you can explore various companies, get to know the investors, their choices and portfolios companies, and also do the valuation based on that which will be kept purely confidential.You will be provided a dashboard through which you can manage your interactions with other members of the network in a completely secure environment.

Conclusion

For entrepreneurs, there is nothing like getting quick access to a suitable investor and see their business reach new heights. If you have a newly-started business and you are still struggling to receive startup funding which is enough to push your company, you can take a chance by being a member of this intelligent network called Merger alpha.

For further information on the network, feel free to visit http://mergeralpha.com/