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Monday, May 5, 2008
Inspiration Ventures - A New Kind of VC? Or Maybe Just One We Don't See Anymore
I have a phone call this week with Inspiration Ventures. I was referred by someone I met with last week who thought they'd be a good fit for the stage we're in. After doing some minor research, which really means I just read their website, I was impressed with them. They've differentiated themselves from other VC's because they're interested in seed stage companies - a dying breed these days! They've differentiated themselves from angels/"friends and family" because they play an active role in your company, which can be a good thing (or a bad thing) - depending on lots of variables. For them though, it seems mostly positive, since their management team has had extensive experience starting and managing startups and they seem to relate well to entrepreneurs. In other words, there's a higher likelihood they'll understand what we're doing and going through as opposed to traditional, later stage VC's - who just want success and their money back - at all costs! Inspiration's other investments also lead me to believe they understand the market we're playing in.
According to Inspiration's website:
* Entrepreneur to entrepreneur guidance leverages past experience and enhances traditional VC funding success
* A seed investment allows the time and market feedback necessary to help make intelligent decisions on whether or not to bet the company on the traditional VC funding scenario
Their seed investments average ~400K and they are interested in helping you get through the first 6-9 months. Seems like a good deal and seems appropriate for us.
FYI - we've just started to think about pursuing financing for a variety of reasons. For example, I thought I'd be able to be more involved in developing the website, but because there are so many other things going on, I haven't had as much time. This means I'd love to get our developers some help...and that takes money at this stage. While we're fine without it, it'd be a huge help and something we'd certainly consider.
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I will definitely look into Inspiration Ventures.
So how much exactly do you need to get to Beta?
That all depends. To get our beta out, we don't need much. Maybe 50 grand would be nice. But in order to build on our strategy, we need a lot more - maybe 500K to build out a team (marketing, biz dev), sales, the next assessment we're developing, and other expenses. This would essentially get us to a series A round.
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