As the startup world turns, venture capital funds in Silicon Valley are becoming harder and harder to come by. But all is not lost, as venture capitalist Mark Crane explains, there are several ways you can succeed in getting funded, even if you’re not operating out of San Francisco or California.
First and foremost, Crane emphasizes understanding the landscape of the venture capital industry. “It’s important to research the VC you’re targeting,” he says. “Are they focused on seed investments, early stage or growth capital? Are they deal flow or thematic investors? Don’t expect the same investor to invest across different stages. Research what they’ve done and how they’ve done it, and then construct a tailored event and target market accordingly.” Put another way, don’t expect to make an impression by submitting a generic pitch deck to a variety of venture capitalists.
Crane also advises entrepreneurs to seek out venture capitalists who are on the lookout for new investment opportunities outside of Silicon Valley. “A lot of venture capitalists are now investing in more geographically diverse deals. That is, they’re looking at start-ups outside of their traditional sphere of influence. I would definitely recommend entrepreneurs take advantage of this and target venture capitalists who are taking an active interest in new markets,” he says.
In addition to knowing the types of investments being made and targeting investors outside Silicon Valley, Crane says entrepreneurs should also focus on networking. “The power of networking is underrated,” he notes. “You can never underestimate the importance of building relationships with potential investors. Of course, it’s beneficial to attend conferences and investor meetings, but you should also take the time to meet with people one-on-one. Speak to them about their interests and start building relationships that may develop into investment opportunities.”
Finally, if you’re based outside of Silicon Valley, Crane recommends taking advantage of grants and other forms of funding available specifically for start-ups located in regions other than the Bay Area. “Your local government may offer incentives for entrepreneurs operating in any given locality. For instance, a number of states and governments offer grants to start-ups in their area. You may be able to access these resources if you’re willing to put in the time and effort.”
Mark Crane’s advice is clear: understand the landscape of venture capital, seek out investors outside Silicon Valley, focus on networking, and take advantage of grants. With these tactics, entrepreneurs won’t have to rely on the Bay Area to get funded.
