What does a VC investor look for?
VC is money made available to start-up or early-stage companies with exceptional growth potential. The returns anticipated by a VC investor will be very high (an anticipated return of 5-10x their original investment is not uncommon), reflecting the high risk nature of the investment, with most early stage companies expected to fail. The VC investor will assess carefully a number of key factors before committing to an investment, and the due diligence process can be exhaustive. Key areas of interest to the VC investor are: a focus on fast growing markets with high margin potential; an innovative intellectual property (IP) based technology which provides a high barrier to entry; the core of a strong, entrepreneurial management team; and, finally, an attractive exit strategy. VC investors will take a medium to long term view on the company’s prospects, but ultimately they are there to make a capital return for their investors. Hence, a well thought out route to an exit is vital, ideally o
