What could you gain from VC advising?
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This week we’re quoting Gillian Marcelle, PhD (Founder and CEO at Resilience Capital Ventures LLC )
What Marcelle said:?
“If VCs had access to more knowledge and cultural capital (both GPs and LPs) there would be a set of wider search routines, more openness during the portfolio construction stage, and then a lot more guiding of the ventures post investment.”
A conversation about diversity in the investments ecosystem?
Marcelle’s point was that more strategic advice for VCs is important to help them address the lack of diversity in investments across sectors.?
VC advising is a specialised form of financial consulting that guides startups and emerging businesses as they navigate the investments ecosystem; or advises investors throughout the process of identifying new investments and adding them to their portfolios.?
So for those of you who aren’t familiar with the benefits of VC advising, we’ve put together a quick guide to what you could gain – whether you’re a founder or an investor.?
What can investors gain from VC advising?
Advisors working with VC firms provide strategic advice to help VCs build the most successful portfolios, and protect their ROI.?
Advice must be tailored to the needs of each investor or VC firm, and it might include sector-specific insights to help investors understand and invest in new segments or markets; support with due diligence; networking and generating an investment pipeline; and more.?
Advisors are investment and market experts. They often have access to a network of startups, and constantly work to expand that network and match startups with investors; and their experience means they’re good at recognising lucrative opportunities at an early stage. They have deep knowledge of the sectors they operate in, so they can help you (the investor seeking advice) to understand market trends and risks in a way that allows you to use that information to make better investing decisions. They’re like your translator between information and action – increasing your understanding and showing you how to make decisions from your new knowledge.?
Advisors often receive a percentage of profits from the VC fund in exchange for their support, and some VC firms also offer advisors the opportunity to invest in the fund.?
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What can startups gain from VC advising??
Advisors for startups work from the other side – using their extensive knowledge of VC markets and behaviour to help founders identify the right investors, craft an effective pitch, and navigate the deal-making process confidently.?
They act like mentors to founders who need support to understand and access venture capital opportunities.?
Network access is a clear benefit of an advisor relationship for founders who are new to the investing ecosystem. But the other support available from investment consultants shouldn’t be overlooked – they often have real experience in scaling businesses, and many can provide operational support that makes a startup more investible.?
A reputable advisor on your side can also boost your credibility in the eyes of investors; and by leveraging the experience, connections and resources your advisor has, you can significantly speed up the process of securing funds and scaling your company.?
How to find a VC advisor
We recommend you start with your network. Recommendations are invaluable here – you want to connect with an advisor who knows your sector, and who you know is reliable and trustworthy.?
So talk to your contacts first. If you’re an investor or VC firm, ask colleagues about advisors they’ve worked with in the past. If you’re a startup, think creatively; are there investors in your network who could help, or do you know other founders who have leveraged a VC advisor to scale their business??
You can head to a search engine and find a VC advisor online. But if you can find one through word of mouth, you’ll already be several steps ahead.?
Read the blog: Why VC advising is key to more diverse tech investments?
Have an idea for a topic you'd like us to cover? We're eager to hear it! Drop us a message at [email protected] and share your thoughts.
Catch you next week,
Richard McKeon
Vice President of Marketing & Communications, Tahaluf
Mark your calendars for ?? 9-12 February 2025.
Former Google Insider ?? Creator of the THRIVE Framework for Modern Business Transformation ?? Professor on Section with 85 NPS ?? Board Director ?? Art Collector - @souderfamilycollection
2 个月Great article, LEAP. Two thoughts: First, advising VC funds and their startups has been transformative. At Revolution, we had an "Experts Network" of industry leaders, meeting regularly with founders in vertical groups or 1:1. Founders found confidence in having operational VCs give them access to experts - a model I can replicate anywhere. Second, at World Minds in Berlin, hosted by Axel Springer, we discussed building entrepreneurial ecosystems for economic vitality. I mentioned to the group that the simple thing every person in the room can do is go and act as a mentor to founders in your local area. Afterward, a very distinguished executive from Germany came up to me and said, "Ted, I am a former CEO of a large European company, and I just don't see what value I would bring to an early-stage founder." It's a fair question, so I responded, "You hired sales teams. You found office space; you secured financing, right?" I have never seen someone's eyes light up as he did. He said, "Oh, yes, I have done all of that and know exactly what others can do to avoid common mistakes that they will make." BOOM, right there, a mentor was born.