Top 5 Questions a VC Should Ask a Startup CEO

As a Venture Capitalist eyeing a new startup, the decision to invest involves weighing risk and measuring opportunity. Making the right choice can lead to big payoffs, but taking too long during the consideration phase can cause you to miss out on a promising idea or a hidden gem. To help you navigate the delicate balancing act between due diligence and striking while the iron is hot, here are the top five questions any VC should ask a startup entrepreneur. 

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Can Biotech Sustain the Venture Capital Investment Surge?

In 2017, the biotech sector experienced over $9.3 billion in venture funding in 471 deals, including several mega-deals such as Unity Biotechnology and ADC Therapeutics. While 2017 was, by far, one of the best years for biotech venture funding since 2010, the question is can that momentum continue through 2018?

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M&A Activity is Soaring High, But What Does It Mean?

Growth through mergers and acquisitions has already surpassed $1.7 billion this year, which is the fastest growth rate in value ever recorded. According to accountancy firm Deloitte, this figure is already well beyond the $1.3 billion in M&A growth recorded for the entire year of 2017.

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New Ways to Raise Money in 2018

For startups, entrepreneurs and small business owners, the future looks bright indeed. According to the Kauffman Index of Growth Entrepreneurship, U.S. entrepreneurial activity has continued to increase for the past three years since 2014, rebounding from the slump of the Great Recession. What's more, 2017 broke records for the most venture capital invested in a single year worldwide.

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How Venture Capital Will Change in 2018

We're finally getting settled into the new year (and getting used to seeing an 8 at the end of today's date instead of a 7). But it's always a good time to make some predictions about what lies ahead in the coming months. In particular, it's especially important to pay attention to the venture capital industry, which can reveal a great deal of insight about the state of the startup landscape.

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6 Reasons M&A Deals Fail

Merging with, or acquiring, another entity is always going to be a risky venture no matter how extensive the negotiations and due diligence process are. As with any major purchase, issues may not be clear until after the fact, and a lot of things can happen once everything is already said and done that may end up destroying any potential value before it is even realized. Here are six common reasons that M&A deals fail:

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Venture Capital Vs. Social Venture Capital

Most startup founders are very familiar with the power and importance of venture capital. Venture capital firms have helped fund countless fledgling startups that have eventually soared to astounding financial success. Although most investments carry a fair amount of risk, venture capital investments are particularly risky given that the money usually goes toward a young, unestablished company with uncertain future prospects. Of course, given that traditional venture capital firms are hoping to earn a handsome return in the long run, they rely on savvy analysts to evaluate the growth potential of a startup before committing to making an investment. In general, the return on investment is the primary concern.

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What Is a Private Placement Memorandum (PPM)?

A private placement memorandum (PPM), which is also called an offering memorandum, is a lengthy document that legal counsel, accountants, investment bankers, and other pertinent professionals put together for a company to present to prospective investors. A PPM can take quite some time to craft, as it must explain the terms of the investment that the company is offering, including an explanation of the goals and potential risks. Here is a brief rundown of some of the key information that should be included in a well-designed PPM:

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6 Common Questions Venture Capitalists Ask

Startup founders know that sourcing and then actually getting an infusion of venture capital can be quite a feat. The economic climate is always in flux, as is the nature of the competitive landscape. As a result, startup founders must do their research before approaching any potential venture capitalists (VCs). It is essential to know the type of businesses the VCs tend to invest in and how well those ventures are faring to ensure the right avenue is pursued. Of course, startup leaders must also be aware of the expectations and requirements the VCs will have, so that they can be well prepared in advance. VCs will no doubt have a ton of inquiries, and if things progress, a lot of concrete data will be requested and scrutinized. Here are some common questions startup leaders must be prepared to answer:

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How to Evaluate An Investor Using the Venture Capital Life Cycle

Venture capital (VC) has been and continues to be critical to the growth and success of countless startups. Most VC firms create impressive funds with a plan to invest in innovative business ideas, and have a lofty goal of selling those interests at a high return after about ten years. This may seem like a fairly long time, but it is actually a relatively short timeframe considering the typical length of a lot of other investment vehicles. One of the benefits of the VC life cycle is that it can help those seeking VC funding to assess prospective investors, and it is not overly cumbersome to perform this analysis. Depending on where the VC firm is in the cycle, startup leaders can get a pretty good sense of the firm’s strategy and performance, which will of course influence whether or not to pursue an investment from it. Here is a brief look into how one can evaluate an investor using the VC life cycle:

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