Reflections on hunting in the Rockies
J ack Hunt knew what he was after when he packed his bags last year and headed to Banff for that city’s annual Venture Forum. His company, Netcelerate, was looking for one or two investors to provide a total investment of $5 million for its next financing round, expected to be in the following 18 to 24 months. But that wasn’t his goal in Banff. “We wanted to take our time,” the CEO said. “We wanted to start the dance a bit early and see if we could find a good partnership … We wanted to get to know them.”
GETTING IN THE DOOR
We went through an extensive ( vetting process). There were three different levels of reviews that we had to do. We made an initial submission and then a telephone interview with a panel of VCs that asked questions and vetted our story (as well as those from other Ontario firms). Based on that, we went to the next round, which was (a) similar experience except it was on a national level.
They took the time to make sure they had a cross-section of different types of companies in different points of their life cycle. There were early-stage companies, and there were a lot (of firms with) beta products. There were also some established companies looking for very significant tranches of financing.
The provincial government’s Regional Innovation Centre provided a professional coach that helped shape the presentation and helped you stand out.
The trap that you can fall into is ( giving the typical) rough outline – talking about the market opportunities, differentiators, the typical things. Everybody is trying to talk in the same way. So what (a coach provided by the Regional Innovation Centre) suggested is focusing on some of (our) customers.
Some of the early-stage companies don’t have customers. If you talk about a customer and talk about the value that they get from the solution, then you can talk about how we can build a business based on those types of customers ... A potential investor can start to understand why customers would adopt this solution and ... see the market that is out there.
UP ON STAGE
There was a main conference room that sat a couple of hundred people. You had 12 minutes to talk and three minutes for questions. You’d give your spiel; your charts would be shown as projections at the front.
Out of that, the investors would either come to you and try to get time with you, or you could network around and try to strike up conversations with some of the VCs that you want to target.
One of the things that worked really well for us is that we brought a booth. We set up outside the conference room. It really helped, because investors that had heard the presentation knew where to find us. We ( pitched) early (and) had a steady stream of investors coming up (to the booth).
We’ve struck up a conservation with a number of potential investors, both private and institutional. I see Banff as ( having) started the ball rolling. What we’re now doing is keeping the conversation going. We’ve given them updates on where we are and we’re having conversations with them. That was the goal that we set out to do.
When we end a quarter, we give them a quick update on how business is going and some of the growth so they can get a sense that there is momentum in the business and things are happening.
— As told to Peter Kovessy