I am with an early stage start-up that will be looking to raise capital in the next 6 months. We completed a Series B round 9 months ago when there was a sense of things starting to recover. With all the market volatility do you think I will be able to get a deal done or will VC's and PEGs be tightening up??
Finding Venture Financing in the Double Dip
Answers
Actually, I am hearing the opposite - that venture activity is picking up again for later stages. However the market bump we just had may have some negative impact on that. VC/PEs still have a lot of money they need to put to work. As usual, the challenge will be in convincing them that you are the right investment for them to make. If you are hitting your numbers you will stand out in the crowd of companies just drowsily humming along. If you are part of the latter group, you will have trouble b/c, as you know, there is a higher bar in the Valley and NYC for all early to mid-stage investments these days. They expect more customers, more revenue, more traction on the road to profitability.
I attended a PE conference yesterday and the PEG's have a great deal of money to put to work. This results from the fact that during the credit crunch they did not do many deals due to lack of leverage in the market. That apparently has opened up. However, private equity is looking for companies which have positive EBIDA (in order to service the debt)
I agree with Bryan that your key to raising funding is your performance; I have found that they are less willing to take
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