Investment innovation – new fund to invest in 100-200 startups annually

Crowd-financing is a great tool to get your project off the ground, but it takes a lot of work and can often keep you from what you should need to, or are working on – the actual business.

There are of course other forms of crowd-financing, such as crowd financed managed seed/investment funds – but the legalities, specifically from the fund management side can get a bit tricky. That aside, company founders have a plethora of other options when it comes to raising capital – however often times these choices are only available to larger firms with positive income streams.

So what’s an entrepreneur to do in this world? Well the good news is that there has recently been some innovation on the field, and it’s a concept that fundamentally crowd-sources start-ups and invests in 100-200 of them per year, so at a minimum, you’re seeing 2investments per week. Compare that to your traditional model of 5-10 annually and you’ll see why this is financially innovative.

So who’s ballsy enough to lead the way on this – it’s a group out of California called Right Side Capital Management. And if you think about it, it makes a lot of sense.

You’re basically taking the roulette table approach, if you spread your money across the table, one will eventually hit, the difference here is, that in this start-up version of the popular Vegas classis, more than one may hit, in fact 2-3-4 may hit, and one of those will hit big – and then there’s your flip.

While there may be problems involved in startup corporate governance, and especially with the way they’ve got their logistics set up, the concept as a whole is absolutely brilliant when it comes to getting money out to those companies that need it.

But how do you go about making investments into 100+ companies, clearly aside from having to increase your deal flow by a substantial amount, you need to employ a very different project valuation methodology rather than the traditional VC model.

From the RSCM website, and specifically the application page, it seems that they are very heavily focusing on the team makeup, and those individuals cash position or personal financial health. Meaning, good credit, probably some money saved up in the bank, or similar – so that you as an entrepreneur can maintain yourself while developing said product and going to market.

After all, an entrepreneur that has no money is one that isn’t going to devote his/her full time to the project. So if we’re right, I bet the assessment criteria would be 1. Team 2. Project 3. Progress.

Any thoughts on this? Let us know.

MBA’s, Entrepreneurship & Growth Companies

While entrepreneurship as a whole is a fairly central topic to most MBA curriculum and a good number of schools have entrepreneurship clubs that organize minor events, and amongst other things panel discussions with successful entrepreneurs. A few programmes have taken their involvement with the entrepreneurship community to the next level.

LBS is one such school where it’s Entrepreneurial Leadership Speaker series focuses on bringing in successful entrepreneurs who students can learn from, INSEAD is another with the Global Entrepreneurship Forum will feature a close look at the global trends in angel investing, fire pitches by leading entrepreneurs searching for funding, a panel discussion on effective entrepreneurial leadership and the announcement of an initiative to celebrate INSEAD’s leading entrepreneurs.

At ESADE in Barcelona the entrepreneurship club has organized the “Quest for Talent” a conference inviting not only growth companies to attend and look for top talent form the region’s top MBA programs, but also, strongly focuses on MBA students interested in entrepreneurship as well as on startuppers seeking partners – overall a novel and innovative approach.

In the U.S. schools have been doing this for some time now, the Stanford business plan competition is among one of the most recognized in the country, and MIT’s commitment to entrepreneurship with it’s Entrepreneurship Center, 100k Competition, Executive summary contest, and the b. plan contest goes far and beyond that of other institutions of the same caliber. Though whether “twitch” is a good idea or just more hogwash around twitter is yet to be seen.

It’s safe to say that the collaboration between enterprise and academia initiated by student initiatives is on the rise. But what is more important is the initiative that can be seen at an event such as Quest for Talent and its focus on growth companies. Considering the need for expansion in human capital as well as market, there is a clear need for growth companies to hire and bring on MBA’s to take the reigns and lead those companies forward – and likewise MBA’s should look for jobs within growth companies aside from your typical blue chips, banks, and consultancies. Why? Reason being – more of an active stake in the role, more of an impact on the company as a whole, and of course a possibility of options. If that company goes M&A, or IPO – it means a big cash payout.

7 ways to build effective networks

efficient network

It’s no great secret that your and your business partners’ professional networks will undeniably aid you in aiding your company expand, enter new markets and gain new clients. But the question is, if you don’t have an access to a strong professional network – how can you build it? And more importantly how can you actualize it?

1. University Alumni – University alumni networks are a great place to start building your network. You and the others have one fairly strong thing in common, which is your school, most if not all universities have alumni networks and encourage their alumni to work together.

If you have access to an online database – even better, but when contacting people you effectively don’t know, it’s important not to come off as if you’re selling something. Be inquisitive ask questions, and see if you can have a sit down over some coffee. Basically, get to know the person before you ask them for a favor.

2. Local Group Meetings – Cities will typically have interest based clubs / meetings which focus on any given subject or topic – a good place to find these groups is meetup.com – and while typically you won’t find the crème de la crème of your industry, it’s a good way in nonetheless.

3. Family – Talk to moms, dads, uncles, aunts and other family members. You never know whom someone may know, and that someone they may know may be the person that you need to speak to. Family can oftentimes be a great starting point for your network.

4. Online Networks – LinkedIn and Xing are a great way to expand your network as well. If you haven’t joined any groups that are of interest to you, do so, and more importantly, start conversations and topic on those groups that are of interest to you.

5. Conferences – Conferences are a great place to meet people, and more importantly people in your industry, though before heading to any conference do some research on it, see what others have said, and if it’s worth going.

6. Private Clubs – There is an array of clubs around the world that can help foster networking, be they Alumni Clubs such as the Cornell Club in New York, or the Royal Automobile Club in London, one thing is certain, your membership will have clear benefits.

7. Personality – Some people have it easier than others. For some who are extroverts meeting other people is as simple as turning on the kettle, for introverted individuals meeting new people can be quite difficult.

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