Venture networking

Venture Networking is defined as the process of networking people seeking investment of various stages, with people who have the financial (or other means) for the purpose of establishing or growing business ventures.

Traditional investment routes

Venture networking has traditionally occurred where entrepreneurs (or brokers acting on behalf of the entrepreneurs) present ventures seeking capital to angel investors, venture capitalists, private equity firms or other sources of investment. Each investor is independently approached requiring substantial effort and time (and money) before an investor is identified who is both interested in investing and will invest in the venture given the mutually agreed conditions by both parties.

Dragon's Den

Sony's "Money no Tora" (Japan) and BBC's "Dragon's Den" (UK) with spin-offs in Australia, New Zealand, Israel, Canada, Netherlands, United States, Finland and the Arab world, are television shows in which entrepreneurs present their idea or venture that requires funding to panel of (typically) 5 potential investors. The investors ask questions and if they think the venture has merit will negotiate with the entrepreneur for a certain amount of equity in exchange for capital.

Given the format and nature of the program many ventures however do not receive fair consideration and are prematurely rejected. Other ventures do secure the promise of investment but later funding is retracted typically because the Dragon had a change of heart (and sited a minor technical reason to allow the offer to be retracted) or misleading information was delivered in the pitch.

What Dragon's Den does offer however is a single pitch to many investors. Dragon's Den is a form of venture networking, albeit designed for television for the purposes of obtaining viewers.

Venture networking, web2.0

A new mechanism for venture networking in which a single venture can be easily and effectively pitched to a large number of investor is accomplished by using the Internet. Services such as [http://upstartgo.com "UpStartGo"] allow entrepreneurs to publish ventures that are then delivered (or searched on the site) to the email inboxes of angels, venture capitalists and other investors. Investors can be read the published description and give them due consideration. If they wish to further pursue the venture they request contact information by simply clicking a button. The entrepreneurs receive notification of interest and can then review the biography of the investor. After due consideration and research the entrepreneur can choose to allow the (self stated) investor to access their contact information. This approach ensures the contact information of both parties will only be distributed after both parties agree. Furthermore the entrepreneur can protect intellectual property before publishing with various inexpensive approaches such as provisional patents and trademarks.

ee also

* Angel investor
* Dragons' Den
* IPO
* Private equity
* Seed funding
* Social Venture Capital