Our advice to start-ups is to make sure that there is a good fit
between the company and the VC’s that back them.
Fit, from our perspective means more than just money. In addition to firms that can meet your current fundraising needs, you should also be asking the following questions:
Do they have experience in this sector?
Can they help me grow my business?
Can they help me operate my company more efficiently?
Does their network consist of contacts that could help advance my efforts?
Can they help me raise my next round of capital?
Do I like working with this group?
iSelect thinks of capital as more than just money.
While we do provide financial capital, we work with our portfolio companies to also provide them with access to talent and customers. From our perspective, we also have “fit” questions. iSelect works with companies that have the following characteristics:
Lead Investor: iSelect does not lead transactions. We only co-invest alongside sophisticated investors such as venture funds, reputable angel groups or family offices with domain experience. Prospective companies must already have, or be in discussions with, a sophisticated lead investor willing to set the price and terms of the round.
Previous Investment: We consider companies that have previously raised $250,000 or more of outside investment or grant funding.
Stage: While our initial investment is typically in a company’s Seed or Series A round, we have the ability to invest at any stage.
Deal Terms: Preferred equity or debt convertible into preferred equity.
Traction: Demonstrates meaningful early traction via customer orders, customer R&D investment, NIH grants, etc.
Geography: While we have a preference for companies located in the Midwest, we want to see that a Company is located near key industry talent and customers.
Plan: Clear milestones and path to follow on capital and exit.
Industry: Preference for healthcare, agriculture, energy, and B2B technology.