Finally I've met a VC

After 12 months in IE, I finally met a venture capitalist in flesh: Roberto Saint-Malo from Adara, Kibo Ventures. Actually, if once in a lifetime you intend to come to a MBA in some point you'll hear about angels, VCs and bootstrapping, which are just fancy names for either put your own money or get it from someone else. Of course there are other financing options for your business like going to a bank or seeking government aid but these three are the ones I've listened the most.

Roberto talked about the things he judges important in selecting the businesses he invests in. He mentioned about understanding what people have done in the past, and not only what they have done professionally but also their relationships with others. He mentioned that selecting a business to invest in is more an art than just science: "A 22 year-old can have more clarity on where to go rather a very experienced individual". Also, Roberto commented on how important is to the business seeking for investors to do their homework and look for someone who can add value. This is a very important point in my view, while you're giving away from 5-60% of your company when you get external equity funding you also have then running the business with you and that can be a powerful relationship that a bank loan wouldn't provide you.

Roberto commented about the selection process and the way he distributes his investments. One of the things that differentiates him is the deal time that he tries to conclude in 8 weeks versus a industry average of 4-6 months. During this time both sides should present their proposals; create a feasible growth plan for the next 6 months and reach a final agreement. He also invests not only in proven business models, but also in early stage businesses, and international opportunistic ventures as he gave us the example of a broadband company. The more the business is in an early stage the higher his share of the pie given his efforts to build the business.

An interesting question that someone asked was if VCs intention is to make the business grow and sell it. Roberto replied and said that while this has occurred many times there are ways to avoid it. According to him, being open about it and putting in the table your intention not to sell it is the best way to avoid this kind of situation and there are other options such as being paid dividends for example. This must be a really tough decision, from the VC side I'd prefer to take a good valuation opportunity and cash it all in at once but from the business side I might have so many opportunities to go and the resources in place that selling might not be my first option.

Well, that's it, another sunny Sunday in Madrid, last week of classes and with all those classes I wonder whether to start my tech startup or keep looking for a job. I'd better stop going to these classes the more I go the less I wanna look for any jobs....lol