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Venture capital

  • 5 Common mistakes startups make when applying for funding

    There is a perception among entrepreneurs that a revolutionary idea is enough to secure the venture capital needed to kick-start their businesses. This is simply not true. Here are five of the most common mistakes made by entrepreneurs when applying for VC funding. 1. No WOW! Factor The first rule in the VC game is that your business proposition must have an exceptional differentiating factor. You need to know what your sustainable...

  • Markets fall: What will happen to Silicon Valley recovery?

    Turmoil in global financial markets and economies is never good for Silicon Valley despite the fact that the regional economy has its own boom and bust cycles that operate on a different timetable. Currently, Silicon Valley has been booming, recapturing the trend that was in place in the second half of 2008, before the financial meltdown, of growing VC investments and jobs. It has to be asked though, whether like that recovery in 2008 which ran smack into an economic crisis, this recovery will again be nipped in the bud. Maybe. Profits at the large Silicon Valley companies such as Google...

  • Forget the bubble, the rise in VC investment is unsustainable

    The latest MoneyTree Report from PricewaterhouseCoopers LLP (PwC) and the US-based National Venture Capital Association (NVCA), based on data provided by Thomson Reuters: Q2 2011 VC investments jump 19% to $7.5 billion in 966 deals. Year ago: $6.3 billion in 814 deals Latest quarter is highest total since Q2 2008. These high levels are not sustainable says Mark Heesen, president of the NVCA: "For the past three years, the venture capital industry has been...

  • Six questions that rejected Venture Capital seekers could not answer

    Raising funding for an early-stage venture is always difficult. There is no bottled recipe for success, but even if you have a great concept that is scalable combined with a passionate team that can execute the growth strategy, you still need to communicate this in a multifaceted investor’s pitch. Most entrepreneurs can give a fair account of the top line business strategic growth path, dive into the complexities of the product or service offering, put together a good industry analysis, name a handful of possible clients and present enticing year three to five financial projections, but this will not necessarily...

  • How to do market and competitor research that wins investment

    Regardless of whether it’s an angel investor or venture capitalist you are approaching, every funder will narrow things down to one major question: “Who is your target market and who are you competing against?” This is the warning of Alex Fraser, who drives home the fact that preparing a market and competitor analysis is a vital part of any business plan or pitch deck. Fraser is based at at InvenFin, an early stage capital company. She says she often receives business plans with no competitor analysis, leading her to request one from entrepreneurs with the need for more information. It’s...

  • South African venture capital exit to US technology giant

    Graceful exits are often unreported, but one South African venture capital company has done it smoothly with seemingly positive effects for the local emerging markets environment in which it operates. PoweredbyVC, which manages the South African venture capital portfolio of HBD, has concluded the exit of its CSense Systems (Pty) Ltd to US based GE Intelligent Platforms. CSense has been behind rapid process troubleshooting and process improvement software solutions that aim to enhance the performance of industrial processes by indentifying problems before they occur. The latest deal sees GE Intelligent Platforms having now acquired the technology assets of CSense,...

  • Yuri Milner: Making billions in the new bubble

    Craig Mellow, at The Deal Magazine has a fascinating profile of Yuri Milner, the Russian investment banker who runs Digital Sky Technologies(DST), a multi-billion dollar fund. Milner has garnered tremendous amounts of publicity for his investments in Facebook, Groupon and other high flying US companies. Late last year, DST partner Alexander Tamas, defended Groupon’s rejection of Google’s acquisition bid, citing that Groupon could become one of the most important companies on the internet. Tamas also said that DST looks for companies with a valuation of at least US$1-billion and it only invests in internet companies that have the potential to become the...

  • A VC boom in new media?

    Investment banker Kevin Covert is increasing staff at his company, Covert & Co, up to prepare for a mergers and acquisitions (M&A) bonanza in Silicon Valley. Move over social networking, move over ecommerce -- he reckons that the conditions are great for M&A -- "especially in new media". If the recent, high-profile Techcrunch and Huffington Post deals are anything to go by, he may be right. Although these are only two high profile...

  • Umbono: Google launches new African tech incubator

    Google has chosen Cape Town as a pilot for a new technology incubator called Umbono which aims to bring together seed capital, Google mentorship, angel investors, local tech stars, entrepreneurs and business leaders. If successful in Cape Town, Google may take the model to other parts of the globe. Google says it chose Cape Town because the city is in "the process of positioning itself as a hub for innovation and technology". The search engine expects that successful funders will move to Cape Town and work "onsite" to take advantage of the opportunity. The search monolith says the incubator is "in...

  • 8 venture capital sources for your startup

    Raising funds in emerging markets may not be a walk in the park, but the process has become easier. Though some have complained the current economic environment is not favourable to startups, the current mindset is favourable to good ideas - no matter where they are. For startups with global vision based in emerging markets, here are eight sources of capital to consider. Venture Partners The US-based Venture Partners (USVP) has helped build great companies in the last three decades. Since its inception in 1981, USVP has invested more than US$2.7-billion in about 450 companies. After the investment the company’s...