Seed money, sage advice help grow the economy
Alan Hall is the founder and chairman of MarketStar Corp., a global marketing and sales organization, and of Grow Utah Ventures, a nonprofit organization that fosters entrepreneurial development in the state.
1. Venture capital is much more scarce these days, but can entrepreneurs still attract capital investments in Utah?
I've always believed that Utah is unique because of the abundance of entrepreneurial talent, and I really believe that it's entrepreneurs who will bring the nation out of this economic downturn. Entrepreneurs should always keep in mind that there are ways to get money other than traditional meetings with investors. At Grow Utah Ventures, we've created an entrepreneurial contest called the "Concept to Company" contest to encourage entrepreneurism and stimulate business growth ... by providing early-stage entrepreneurs with a venue for pitching their ideas to a panel of industry experts and judges with as much as $35,000 and services available to the winner.
2. What are the keys to finding venture capital in the current economy?
When I invest in a company there are five key questions that I need to have answered: 1. Does the company have good strong leadership? 2. Is there a market for the product or service the company offers/provides? 3. Is the product compelling? 4. How is the company going to use the money? 5. Who else is involved or associated in driving the company forward?
3. What elements should a presentation contain?
Other key elements to keep in mind include: Who are your customers? How are you going to make revenue?
4. What are other important factors?
One of the first tips I provide would-be entrepreneurs is to find somebody who can act as a mentor. This person should be somebody that has been there and done that and can help you understand and get through the challenges that every new business owner will face. As important as funding is, finding qualified people to serve as mentors is every bit as important. If you can find a mentor who is willing to make an investment of time into you and your company, your chances for success are increased exponentially.
5. What are pitfalls to avoid?
Networking is an essential activity for any successful entrepreneur. However, while everybody networks and eagerly hits all the big events with a fistful of business cards, ultimately the success of any networking event hinges on making real and lasting connections with people who will help you identify and advance your business opportunity. This is especially true when networking to find and identify potential investors. Preparation is the key to effective networking. Prepare by first identifying and selecting the right events to attend where you can meet potential mentors, partners and investors who will be interested in you and your opportunity. Be selective and focused.