I do this work because I enjoy helping entrepreneurs, especially those who are brave enough to pursue solutions to some of our country's most intractable problems.  I get calls from quite a few entrepreneurs -- sometimes too many to which I can possibly respond -- asking me all sorts of questions.  Answers to most of the critical questions can be found on our website.  First and foremost are our Deal Criteria, but increasingly important are the Services and Feedback we provide, and details on our Application Process. But of course, there are some aspects of applying and presenting to Investors' Circle that one can only learn from experience.  So allow me to share a list of Do's and Don'ts that I've gathered working with investors and entrepreneurs. Do Clearly explain what your product / service...

  Finding new sources of capital can be difficult in a down economy, but there is an avenue which may offer an additional option for your business, initiative or non-profit cause.  Crowd funding is an online sales platform used to raise money from numerous people in small amounts.  Business, individuals or non-profit organizations can establish a campaign with their story and a target amount for funds raised. The aggregate or total of ‘the crowd’ giving or investing small amounts can add up to a meaningful total. Amounts are small, as low as $10, and many of these sites work with donations.  DONATIONS?  For a business?  Sounds like free money, right?  But remember, there is no free lunch.  Are you a fit? Crowd funding works for businesses, organizations or individuals with a compelling story and/or product people want to...

What is crowdfunding? I like to define crowdfunding as basically the opposite of the traditional model of business finance in which you seek funding from a bank, wealthy individuals, and venture capital funds.  With crowdfunding, you offer your investment opportunity to a much larger audience and may end up with tens or hundreds of smaller funders.  There are several advantages to this method of funding: You have more people that are invested in your success and are likely to support you. You create an opportunity for non-wealthy, nonprofessional investors to put money into a business they believe in.  With a large number of small investors, it’s unlikely that any of them will expect to be able to control the way you operate.  With a larger potential pool of funders, you have a better chance of actually raising the amount of money...

  When entrepreneurs pitch for capital, whether to investors or partners, they are really selling their idea or startup.  However it is not just a simple sales pitch.  There is often a lot riding on it, and whoever is being pitched will generally be considering some sort of long-term relationship.  Similar to a profile on a dating site, if it's a good pitch, then it can open doors to what is really needed, i.e., investment or collaboration.  If it's a bad pitch, then no matter how wonderful the startup/idea is, it will probably not get what is needed to move forward and grow into a substantial business.  Many entrepreneurs underestimate the value of the pitch, and so many go hungry for the partners/investors that could change the startup game for them.  In the dating game most people looking for love know how important the first date is,...

By Michael Burgmaier and Bob Burke Trying to bridge the gap between what you think your company is worth and what investors think can be difficult and frustrating. As a general rule, entrepreneurs overvalue their companies. Who wouldn’t? Entrepreneurs are optimistic– that’s one of the main reasons we like working with them. And investors who decide to deploy their capital in a company do so because they believe in the promise of the company as well, but there is one major difference between investors and entrepreneurs: Investors better understand the risks they are taking with their investment. If every idea was great and every company deserved capital, then banks would be lining up. Equity capital exists because equity is high-risk capital, and returns data plays this out. In general, one in three venture capital investments end up in a complete loss,...

Joseph Steig tells us about the challenges facing young innovators and how VentureWell is addressing these and creating success stories.   What are some of the biggest benefits VentureWell offers fledgling campus-born startups? VentureWell is an initiative of the National Collegiate Inventors and Innovators Alliance (NCIIA). We convert the so-called “valley of death” between innovation and venture creation and initial commercial activity into a “time of brilliance.” The challenge for young innovators is understanding how to design and sell their products, understand their target markets and get customers. We address this issue by connecting an annual cohort of innovators with a cohort of seasoned industry advisors, in select sectors. The challenge for young companies of getting market validation has effectively been addressed for Internet startups...

Jeff Sheinbein shares his dos and don'ts of following the "investment yellow brick road" - from starting the business in his apartment closet, to developing a business plan, to seeking capital through Investors' Circle.   Social Imprints is Printing with Purpose Social Imprints LLC (SI) is a custom printing and embroidery company located in San Francisco with a unique social mission: to provide higher paying professional jobs to at-risk adults (mission employees) including ex-offenders, recovering substance abusers and economically challenged individuals. While most social enterprises focus on offering lower-paying transitional jobs in production and assembly, SI provides high-functioning at-risk applicants with white-collar career opportunities in management, sales, marketing, accounting, and customer service. Employees are treated as owners and...

Searching for Young Entrepreneurs Creating Opportunity for Low-Wealth Individuals   Investors' Circle partners with The Hitachi Foundation on the Yoshiyama Young Entrepreneurs program. The Hitachi Foundation will award five entrepreneurs with $40,000 and IC will provide mentoring expertise to strengthen emerging enterprises. The Hitachi Foundation has reignited its search for young entrepreneurs whose business enterprises are creating economic opportunities for low-wealth individuals in America. The Foundation opened the application process for The Hitachi Foundation’s Yoshiyama Young Entrepreneurs Program, seeking to identify five entrepreneurs, awarding each $40,000 over two years, and providing technical resources to strengthen their business. “Now in its second year, the Yoshiyama Young Entrepreneurs Program is a business competition with an...

IC in conversation with April Allderdice, CEO of MicroEnergy Credits     As a Fulbright scholar and Echoing Green fellow, April Allderdice helped to start up Grameen Shakti, the renewable energy business of Grameen Bank in Bangladesh. Her new venture, MicroEnergy Credits, is a social enterprise which links microfinance institutions to the carbon markets when they lend for clean energy. MEC sells the carbon credits earned by replacing dirty fuels like kerosene, wood, coal and dung on the voluntary carbon markets and passes the carbon revenues along to its partner institutions. The institutions can then use the revenues to offset their costs of running the clean energy program or can pass the savings along to the client in the form of reduced interest rates, free battery replacements or other benefits. In 2008, MEC won the Global Social Venture Business Plan...

By Glenn Croston, Starting Up Green   I think we all love a good story. It must be wired into us from the ancient times when we gathered around a fire at night and grew closer as a community. Your marketing and communications efforts need to be like this, telling a story that people connect with, a story that draws them in and takes them from listeners to customers, part of your group sitting around the campfire with you. The stories businesses tell are in every speech, interview, ad, Tweet, website, pamphlet, and press release. The most successful green entrepreneurs like Spencer Brown at Rent a Green Box or Gary Hirshberg at Stonyfield Farm are masters at telling their story and connecting with customers this way. And you can do it too. Too often though startups focus so much on developing their product that they have little time, money, or energy left for...

A View Towards a Two-Tiered Evaluation of Risk, Return and Social Merit of the Social Enterprise By Bill Harrington, Vista Ventures Many socially motivated investors first apply their social criteria or social screen to a prospective investment candidate. For some the social criteria are absolute but others are may have less stringent social requirements. In either case, that approach may not lead toward a high rate of successful investments or an efficient means of evaluating investment candidates. Conventional wisdom holds that an investor’s choice is based on risk vs return in the prevailing environment. That is, a high-risk venture warrants a higher return. A deal that takes a longer time to realize its return has more time for things to go wrong and a greater probability of unforeseen risk factors which, taken together, is likely to merit a higher return when...

An update from Investors' Circle's Nick Flores, Director of Investment and Entrepreneur Services   As you may already know, we are committed to improving the level of organizational support and service we offer to social entrepreneurs. Our semiannual Venture Fairs have been successful fundraising events for many of the presenting companies, with no fewer than 25% receiving capital every time. This compares quite favorably with the ~10% industry average for most other angel groups. However, many of you have proffered helpful feedback and informed us that our conference calendar does not necessarily align well with your capital needs. Other entrepreneurs that have unsuccessfully pitched or applied to IC have also told us that the level of feedback they received was not commensurate with their expectations. We have heard some of the grumblings, and while we will...