On 6/26 Thursday evening, Folsom Street Technology Garage organized “Venture Capital Update with Rubicon Venture Capital's Andrew Romans” at Regus, 795 Folsom Street in SoMa, San Francisco.
Andrew started off the Meetup by giving some essential advices on fundraising. To engage in a successful fundraising is “all about the people every step of the way”. Andrew recommended the entrepreneurs to:
1. Recruit top cofounders, advisors, “advisory seed round”
2. Recruit junior cofounders contingent upon a minimum target of funding
3. Go to lawyers before VCs for their networks. Get them to defer expenses
4. Start a business that makes money or has a scaling revenue model
5. Price your rounds to make sure value goes up not down
6. Raise money from angels after VC round, top up each VC round
7. Angels should have access to the same quality of deals as VCs, but keep a tidy cap table
Andrew emphasized that one of the secret sauces of angel and VC investing is to make everyone like & trust you by: making introductions, doing favors, doing what you say you will do. After all, the VC and angel investing community is an ecosystem at large.
Even though it has never been easier or cheaper to launch a startup today than 10 years ago due to the proliferations of mobile webs, accelerators, data hosting providers like Amazon AWS, open source coding platforms, lower cost offshore developments, social media platforms to acquire users cheaply and quickly, the real estate price in San Francisco Bay Area and Silicon Valley keeps soaring. Startups can look for desk or incubator leasing company like OfficeLeaseCenter.com to get access to reasonably priced coworking office space with other like-minded startups.
Andrew also noted the “changes to Venture Capital landscape” now and then. Most VC funds raised larger not smaller funds post 2001 and 2008 economic crashes, VCs became more private equity than VC, and failed to get enough diversification. This leaded to super-sized Series A that often time limits option for founders to sell early. Emergence of new smaller funds like Rubicon Venture Capital and many new innovative models are there to provide necessary help for startups to thrive.
About Andrew Romans:
Andrew C Romans – General Partner, Rubicon Venture Capital Silicon Valley
Former General Partner of The Founders Club, a venture capital equity exchange fund and provider of discrete, controlled, and efficient liquidity solutions for founders, early employees, investors, and other shareholders of private companies. Romans was previously a managing partner at Georgetown Venture Partners (GVP), managing director of Sentito Networks (acquired Verso) and founder & president of The Global TeleExchange (The GTX), where he personally raised $47m in VC funding.
Author of McGraw Hill published book (August 2013) available on Amazon, Barnes & Nobel and Apple iTunes – The Entrepreneurial Bible to Venture Capital, Inside Secrets from the Leaders in the Startup Game. The Huffington Post, in a recent article, calls the book “the most important book to be written for entrepreneurs since the Eric Ries classic, The Lean Startup.”
Romans is a frequent venture capital guest speaker on TV shows including MSNBC and CNBC. Fluent in English, German & French. Professional network in the US, Europe & Israel. BA UVM, (exchange student Duke University, FU Berlin), MBA in Finance from Georgetown University completed on scholarship. Subscribe to Andrew’s blog - The Hitchhiker’s Guide to Venture Capital. Andrew is based in Silicon Valley. Follow him on Twitter @romansventures.