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Funding changed with economy?

 
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jcwilde1

posts: 26

Dec 15, 2008 2:21 PM ET    Quote  Report Abuse
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I have read that venture funding may be harder to come by with the economy the way it is right now. Does anyone have any information into this subject? I am not talking about smaller funding but funding of 250k and higher.

Anyone get funding recently that can prove otherwise?



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FastVentures

posts: 306

Dec 15, 2008 3:31 PM ET    Quote  Report Abuse
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There can be no doubt about it that recent economic uncertainties have changed the financial industry landscape.

Since hedge or venture capital funds usually don’t invest their own money and thus require sizable capital investments from high-net-worth individuals, corporate entities, other funds, banks, or endowments, recent economic jitters can severely impair their ability to raise cash and thus reduce the overall availability of risk capital.

If a fund is closed, meaning they already raised all their capital requirements and they are not fully-invested, they will continue to consider viable investment opportunities, although I think it is fair to assume with that they do so based on heightened due diligence procedures.

Having said that, there probably isn’t a general answer to your question, except that with capital requirements of only $250,000, you would hardly qualify for venture capital investments under any economic circumstances.

I think your best bet is to approach angel investors, as they are more likely to invest smaller amounts of their own money.

I hope this helps.


Mark



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EngineersCanSell

posts: 163

Dec 15, 2008 8:46 PM ET    Quote  Report Abuse
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You`ll be hard pressed to find a VC interested in only $250k.  I pitched a private equity firm last Friday for $5M - and was encouraged to try to leverage some of that money because they, as are most firms, are in the process of making sure that their current portfolio survives.

So they are interested in a smaller deal with other debt coming in.  But still, for $250, you`re better off playing with strategic angels.

Where are you located and what is your market?

robertj

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Dec 17, 2008 3:03 PM ET    Quote  Report Abuse
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I have read that venture funding may be harder to come by with the economy the way it is right now. Does anyone have any information into this subject? I am not talking about smaller funding but funding of 250k and higher.

Anyone get funding recently that can prove otherwise?

 
jcwilde,
 
Having been through several cycles (no one quite like the other) what I will say is that good opportunities can acquire capital. As Mark indicated, the due diligence may be more "in depth" and may take longer.
 
There is a lot of cash "out there" right now. One possible plus is that there may be less "noise" competing for the attention of capital sources.
 
So as always - if one has a solid situation, presents it well to the right people - I believe they can successfully acquire the capital.
robertj12/17/2008 3:04 PM


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Mash85

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May 17, 2013 3:37 AM ET    Quote  Report Abuse
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Funding has shifted to technology startups in a massive way over the last 5 years. So if you are a non technology startup,your business must really be feasible to even get a meeting with a venture capitalist,let alone getting a funding.

 

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