Small Business Trends Radio

What Investors Look For In Startups

Cathy Panzica on what investors look for in startups So you have a technology startup in today’s hottest area. And you are looking for investment to accelerate the growth of your business because speed to market is important.

But you don’t know where to start when talking with investors – what do you say and how do you say it? And what in the world do these investors want?

The featured guest in this episode of Small Business Trends Radio is Cathy Panzica of Panzica Investments, LLC. Cathy is a corporate lawyer, ordained priest and venture capitalist and in this episode she provides us with an inside glimpse into the mind of a venture capital investor and shares what investors look for when deciding to invest in startups.

Among the points in the show are:

  • Impress investors. Express your passion for what you do. Be sure to say something that shows your business is compelling. An investor will look at the business’s intellectual property. Cathy likens it to real estate. For example, what have you developed of value? How valuable is your business’s “property?”
  • Create a business plan. But do not overdo it, as it only accounts for 10% of the total package. Your business plan should not be more than 20 pages in length — investors will not read long business plans. It needs to have a compelling executive summary. Also include outside materials such as Gartner Research Reports.
  • Use a PowerPoint presentation. Include no more than a dozen slides and keep it no longer than 20 minutes in length. Calibrate your presentation by including pauses and breaks and preparing to accept interruptions in the form of questions from the investors.
  • Watch what you say. Do not say the wrong things to investors such as “these numbers are conservative” or begin by discussing an IPO right from the start – giving the impression that you just want to cash out.

Today’s Trend: In addition to the above points, please stay tuned at the end of the program to the Today’s Trend segment. The Today’s Trend for this episode is a continuation of last week’s segment: Hot Business Opportunities For Today’s Small Businesses. Today’s Trend examines some of the most promising business opportunities for small businesses today, including services for seniors and retired people, information filtering services, Hispanic products and services, and hospitality businesses that create an experience.

Recorded: September 26, 2006

Duration: 53:29 minutes

About Cathy Panzica

Cathy spent over 20 years cultivating a global mergers & acquisitions and venture finance legal practice, serving a myriad of clients that range from the Fortune 100 companies to emerging and mid-market enterprises. Cathy spent 15 years in London, where she developed a passion for technology in the emerging companies’ market place. In Europe, she formed her own consulting practice and worked with global enterprises and start-ups to foster and capture the value of strategic technology innovation.

Cathy has dedicated herself to transforming economies through the creation of truly innovative business strategies. While in London, Cathy consulted with the Office of the Prime Minister to help generate ways in which technology development could drive economic outcomes for Britain. After her years in London, Cathy recently returned to her native United States to continue her practice of law and consult with technology-driven enterprises.

Cathy is the leader of the Red Room Revolution, a set of 20 economic development initiatives structured to transform the Northeast Ohio Region using a technology platform. She also is founder of Panzica Investments, which made a commitment to fund 24 technology companies in 18-36 months. As of March 15, 2006, 7 investments have been made in 9 months. Cathy also visioned and started the Beta Technology Park in Mayfield Village, Ohio.

To learn more, visit Cathy’s website Panzica Investments, LLC.

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