Initial/Seed Venture Capital

How to obtain the initial venture capital to give your enterprise a healthy start
By M. Spencer Wolf As an entrepreneur you need initial venture capital to finance your company or business endeavor. You can acquire initial/seed venture capital for a new company that is not yet established in its operations, to introduce a new product to the market or to finance the research and design phase of your operation. However, most seed capital investors and seed capital firms expect to own a significant share of the companies in exchange for providing seed capital.

At times the demand for rapid growth can require initial venture capital from outside sources. Bank loans are sometimes not an option and trading stocks is only feasible for larger corporations. Private sources of seed money for venture capital can be an attractive option. In fact, private equity plays an integral role in the seed venture capital structure of many high-growth firms. Many new businesses find that raising initial/seed venture capital can be exhausting. However, here are a few tips to make the search for seed venture capital easier:

1. First develop a practicable business plan that appeals to seed capital firms.

2. Research universities and colleges that provide venture capital for startups.

3. Pitch your business plan to seed capital investors in your community.

Appeal to seed capital companies to boost your chances of receiving investment funding

Traditional seed capital investors look for several factors in their potential clients: companies with a well defined brand in their technology, products that can be applied to solving major problems, a strong customer constituency with buying power, capable management and a practicable approach to liquidating unnecessary assets. A seed capital company may reject hundreds of proposals before selecting promising candidates.
Try:  Check out Garage Technology Ventures, a seed capital firm that gives between $500,000 to $3 million in seed venture capital to entrepreneurs with big ideas in software and material sciences. Santa Barbara Technology Group provides management assistance, strategic guidance and valuable connections for entrepreneurs seeking initial venture capital.

Consult non-profit organizations specializing in seed venture capital

Finding seed capital firms that want to invest in your idea can take a considerable amount of time and research. By contacting networking groups that focus on seed money for venture capital, you can narrow down your potential list of seed capitol investors. Rather than approaching a privatized lender, you may have more success in applying to a foundation geared towards helping your company thrive.
Try:  Becoming a member of the National Association of Seed and Venture Funds will give you access to seed venture capital firms and early-stage investment professionals across the country. The Social Venture Capital Foundation is a public foundation devoted to empowering individual and small business enterprises.

Develop a business targeting untapped global markets to get venture capital for startup businesses

There are more companies and investors willing to put up initial/seed venture capital for companies that are going into regions like the Far East and Europe. Much of the appeal a private lender sees in providing seed money for venture capital comes from the possibility of gaining a foothold in emerging markets. If you can show that you're ahead of the curve in this regard, you boost your chances of attracting a seed venture capital firm.
Try:  VC Firm is a seed capital company that has the ability to invest seed venture capital in considerable amounts in high potential e-business startup projects focused on Asia. Global Seed Capital works with promising young companies that may potentially benefit from globalizing influences in information based venues.

• Marketing is the operative word here. Rather than approaching a seed venture capital firm with heartfelt confidence in your company, make it a point to conduct yourself with professionalism and competence.