The early negotiation, the term sheet can be a difficult
period, but if everybody's reasonable, there's no lasting impact from
that, and once the VCs are, are on board they
ought to be 100% behind helping the company be successful.
I'd encourage the entrepreneurs to reach out to CEOs that have
worked with these other VCs to find out if they are.
Company friendly and adding value to their boards so that diligence aspect
is important…
…but at the end of the day the investors can help
a lot because they have a
network of potential management team members consultants
the various support groups around the
company like the lawyers and the accountants.
And hopefully they have the experience of helping bring early stage
companies through all the way to market and and ultimately to exit.
A good VC also has strategic relationships
with all of the business development folks at.
At large acquirers and often those relationships go all the way to the CEO
level which can be very helpful when you are negotiating the sale of the company.
>> I think one of the areas that VCs
can be most helpful is in, in raising subsequent rounds.
The VCs all have a network of other venture capitalists that
they've worked with as syndicate partners where they can make introductions.
They can also steer you away from venture capitalists
that really don't have money to invest, in companies at
this stage, or maybe venture capitalists or angels, or corporate
investors, that haven't been helpful in, in their prior experience.
So, they could be a good mentor and a coach
for the entrepreneur's going through the fundraising round
>> Every one on the team has a role to play.
The founder, the CEO, the management team, and the employees,
as well as the board, all play very different roles.
The board ought to not be there to micro
manage, and in my experience most VCs don't want
to run the company or that's what they would
be doing versus managing a portfolio of venture capital.
So, you know, everyone has their role to play, and I would encourage
the entrepreneurs to use board meetings as an opportunity to focus their teams.
On achieving major milestones and reporting those to the board in
an open and honest fashion, that will build a lot of trust
with the board and, and allow the board to, to get out
of the role of micromanaging and instead focus on, on future strategy.
>> I encourage an open honest relationship
between the, the VCs and the entrepreneurs.
Every company that I've been involved with has had their Waterloo
moment where we weren't sure the company was going to succeed.
Companies like Perclose, Acclarent, EPI, Ardian, all
had their moment when we weren't sure that either the technology was going
to work of that they were going to achieve medical trial
success or that we were going to achieve our commercial ramp.
So that aspect is not foreign to venture capitalists.
They expect companies will miss milestones.
They expect companies.
Will have their challenges along the way.
If you have an open, honest trusting relationship where the
information is shared and, you know, there are no surprises.
The, the board members hear about the issues as they come up.
Then that will be reciprocated, and everybody can
help work to solve the, the, the the problems.