How To Find Venture Capital Investment Opportunities

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In a robust capitalistic society, the relationship between new companies and their investors is a game of mutual risk and reward.

These new startups need capital to get off the ground.

For willing investors, the potential to get a massive return on the investment exists. The trick is finding the right investment.

If you are interested in venture capital investment opportunities, then you need the best information to guide the process.

What Is Venture Capital?

Venture capital is a unique form of financing. It comes from private equity sources.

In other words, it is funding from private individuals or companies.

Venture capital is focused on startup companies. These new companies are usually at a stage of extreme growth, which is why they need additional funding to realize rapid expansion.

Venture capital investments are typically made in exchange for an ownership stake in the startup. While such an investment has the potential to be extremely lucrative, it can also yield nothing.

Many venture capital investments fail.

Venture capital opportunities are often found in dynamic industries like information technology, biotechnology or clean technology.

Finding Venture Capital Investment Opportunities

Given the high levels of risk and reward, it is important to pick the best venture capital investment opportunities. However, finding these opportunities can be easier said than done.

Startups are being developed all over the world, and they represent a wide range of industries. Getting access to the information you need to make an informed decision is imperative.

Resources to Guide Your Investment Search

To guide your search for a viable investment, make sure you have access to several tiers of data. First, you need to be able to find these startup companies. There are numerous resources and news websites that talk about the hottest developing companies. Staying on top of the latest news can alert you to some of the best opportunities.

Before you invest in a company, you need to know its business model and how it intends to continue growing.

You should look closely at the company’s history, and you need access to its growth projections. This information is needed to decide whether or not the investment interests you. You can find this information when you leverage key networks and databases designed for investors and startups.

Urban Capital Network

Urban Capital Network (UCN) is an extraordinary resource. Although there are many networks for venture capital investors, UCN seeks to broaden access to such investments.

In this manner, UCN has essentially created a more democratic investment process.

This means that more people than ever have access to these investments, and the growth potential is substantial. All the investment opportunities on the network are vetted for their viability, making this a powerful resource for novice and experienced investors.

Angel Investor Networks

Angel investors are important players in venture capitalism. These investors buy up large portions of a company during its early phases.

Then, when the company has grown, the angel investor will sell his or her shares at a profit. Angel investments are seen as relatively short-term.

A network of angel investors seeks to connect investors to viable investment opportunities. It is important to remember the unique role of an angel investor before putting your name out there as a potential angel investor. However, if the scope of the role suits your interests and resources, then becoming involved with this kind of network is a smart idea.

Venture Capital Databases

For more standard venture capital investments, hooking up with a venture capital database can be a great option. These databases are designed for potential investors.

You can list your information in such a database. Then, startups will seek you out.

This can make it easier to sort through the possibilities since you only have to vet companies that reach out to you. When you put your information in the database, you will be expected to disclose some key details so companies know what kind of investor you will be.

Startup Databases

Startup databases look at the relationship between investors and companies from the other angle. When you peruse a startup database as an investor, you have the chance to consider each company for yourself.

You can expect to spend more time doing research when you leverage a startup database, but you will also have more control over what opportunities you want to pursue.

If you are new to the process, then this level of control can be overwhelming. However, many investors also find it empowering.

A Few Tips To Consider When Evaluating Investment Opportunities

Once you have access to the resources, you need to develop a process to evaluate your options. Consider the six following criteria to get started.

  • Character: Consider the character of the business partners. This can be subjective, but you may be drawn to their experience, integrity, background and more.
  • Capacity: Look at what the company is capable of putting out. The capacity will be tied to your potential earnings.
  • Innovation: Focusing on true innovation can ground your search. Entirely new ideas have more potential to make inroads in the market.
  • Community Benefit: You have to consider the value of the business. If the business yields palpable benefit to the industry or the world at large, then it might be more viable.
  • Sustainability: The business should have a plan that outlines how growth can be managed over time. You do not want a hot idea that fizzles out fast.
  • Finances: Ultimately, investment is about the numbers. You want to look into the company’s finances to understand the risk and reward.

Final Thoughts on Venture Capital Investment Opportunities

Venture capitalism is an important part of society. If you want to be a part of that process and experience the excitement and growth, then you have to be prepared with the best resources. Use these resources to do your research, and you can make your first investment in no time.