Tips from Boston Investors for Securing Early Round Funding and Achieving Startup Success

Friday Jan 4, 2013 by Libby Kober - Communications Officer, IDEA: Northeastern's Venture Accelerator

Last month, IDEA: Northeastern’s Venture Accelerator hosted Investor Insights, a biannual event featuring a panel of venture capitalists and angel investors. The forum provides attendees with insight into the investment world and tips on moving ventures towards becoming investment ready.

The panelists included: Bilal Zuberi of General Catalyst, Glenn Champagne of Launchpad Venture Group, Jim Moran of North Bridge Venture Partners, and Mike Dreese of Newbury Comics.

The panelists agreed that startups in the Greater Boston area are in the right place at the right time: “This is an exciting time for early stage investment in Boston,” said Glenn Champagne of Launchpad Venture Group. Jim Moran, General Partner at North Bridge Venture Partners continued, “the Boston population has proven again and again that whether they are undergraduates, recent alum, or even dropouts, they are creating great companies.”

Some of the panelists’ quick tips for start-up success included:

Bilal Zuberi – Principal, General Catalyst
•    "Take risks early and learn from them."
•    "There is a science behind virality and customer acquisition. Find your niche and exploit it."
•    "As silly as your idea might be, do a startup no matter what – you will be a better person."

Glenn Champagne – Angel Investor, Launchpad Venture Group
•    "Whatever your business plan is now, it's going to be rapidly different next year, and that’s ok."
•    "The passion has to be there, surround yourself with the right folks, reach out, and get used to the word no.”

Jim Moran – General Partner, North Bridge Venture Partners
•    "Do everything you can to try to kill your own idea – if you can't, then you have something."
•    On evaluating early stage investment pitches: "The hard part is parsing the signal to noise ratio."
•    "Passion, blood, sweat, tears and soul, all are necessary ingredients for success."

Mike Dreese – Angel Investor & CEO/Co-founder Newbury Comics
•    "Embrace your strengths and admit your weaknesses."
•    “You need a cost-effective solution to solve a real pain point for consumers. Solutions to problems without pain are terribly difficult to create demand for.”

As one of IDEA’s premier events, Investor Insights attracts many budding entrepreneurs within the Northeastern (and Greater Boston) community. Mike Dreese began as a young entrepreneur himself, opening his comic book store in 1978. During the discussion, however, Dreese highlighted the fact that he often meets young entrepreneurs who have “a lot of ego and not so much skill.”

Dreese provided some advice to help avoid this:

“As you gain more experience in real-world business situations,” Dreese explained, “it becomes easier to maintain a genuine confidence in your product or idea without seeming young and cocky, simply because you develop an understanding of how things actually work.”

“For example,” he continued, “someone who has worked in their parents' restaurant will generally have less of an ego than someone who came straight from school; the former has hard-earned knowledge from experience, whereas the latter has only read or sat in lectures about business practices."

For ventures seeking early-stage funding in the area of lifestyle and retail, Dreese had the following advice for generating financial outlooks: “Things generally cost way more to produce and market than forecasts indicate, so be sure there is significant margin available once the product hits volume.”

Finally, Mike highlighted the benefits of a program like IDEA and Investor Insights. “The event is an amazing gut-check for aspiring entrepreneurs. Rarely do real investors interface in such a frank manner with such great, raw, up and coming talent. Bravo to Northeastern for supporting the bleeding edge of new ideas!”

Join us at the next Investor Insights on March 27 from 5-7pm. Stay tuned for updates at northeastern.edu/idea and on Twitter at @IDEANEU.

Libby Kober is a Communications Officer for IDEA: Northeastern’s Venture Accelerator at Northeastern University. Follow IDEA at @IDEANEU and Libby at @libbykober.

 

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