A comprehensive workflow for sourcing micro venture capital deals, from industry research to post-investment management and reporting.
1
Identify industries and trends of interest
2
Research specific companies within those fields
3
Initial Screening of potential companies
4
Create a shortlist of prospects
5
Reach out to founders or key decision makers
6
Set up meetings with key stakeholders
7
Conduct Initial due diligence and company evaluation
8
Present Initial findings to internal team
9
Approval: Initial Investment Proposal
10
Conduct advanced due diligence
11
Prepare investment proposal
12
Negotiate terms of investment deal
13
Draft legal and financial documents
14
Arrange funds for the investment
15
Approval: Final Investment Proposal
16
Close the investment deal
17
Kick off post-investment monitoring and management
18
Create a report on the venture capital deal
19
Plan for potential follow-on investments
Identify industries and trends of interest
This task is crucial in the initial stage of the deal sourcing process. It involves researching and identifying industries and trends that align with the venture capital's investment strategy. By staying updated on emerging industries and trends, the team can uncover potential investment opportunities. The desired result is a comprehensive list of industries and trends that have potential for growth and innovation. The task requires market research skills, the ability to analyze data, and stay informed on current events. Challenges may include the fast-paced nature of industries and trends, but regular monitoring and networking can help overcome this. Resources needed include industry reports, market analysis tools, and relevant online sources.
Research specific companies within those fields
In this task, the team will conduct thorough research on specific companies within the industries and trends identified in the previous task. The goal is to gather information that will help in the evaluation and screening process. The team should focus on factors like market position, competitive advantage, revenue growth, management team, and potential risks. The desired result is a comprehensive report on each company, highlighting key insights and potential investment opportunities. The task requires strong research skills, analytical thinking, and attention to detail. Challenges may include limited availability of information, but utilizing various sources such as financial statements, news articles, and industry reports can help overcome this. Resources needed include reliable databases, research tools, and relevant industry publications.
Initial Screening of potential companies
This task involves conducting an initial screening of the potential companies based on the research conducted in the previous task. The team will assess each company's viability for investment based on predetermined criteria such as market potential, competitive advantage, management team, and alignment with the venture capital's investment strategy. The desired result is a shortlist of companies that show promise for further evaluation. The task requires critical thinking, evaluation skills, and the ability to prioritize. Challenges may include the subjectivity of screening criteria, but regular team discussions and clear evaluation guidelines can help overcome this. Resources needed include evaluation templates, screening criteria, and a collaborative platform for team discussions.
1
Company A
2
Company B
3
Company C
4
Company D
5
Company E
Create a shortlist of prospects
In this task, the team will create a shortlist of prospects from the companies selected in the previous task. The shortlist will include companies that demonstrate the highest potential for investment based on thorough evaluation and screening. The desired result is a concise list of prospects that meet the venture capital's investment criteria. The task requires careful consideration, analysis of evaluation results, and consensus among team members. Challenges may include limited resources for in-depth evaluation, but utilizing the available information and evaluation criteria can help overcome this. Resources needed include evaluation results, decision-making frameworks, and a collaborative platform for team discussions.
Reach out to founders or key decision makers
This task involves reaching out to the founders or key decision makers of the shortlisted prospects. The team will initiate contact to express interest in potential investment opportunities and gather more information about the companies. The goal is to establish a connection and set the stage for further discussions. The desired result is successful communication and engagement with the founders or key decision makers. The task requires effective communication skills, negotiation skills, and the ability to build relationships. Challenges may include difficulties in reaching the right contacts, but thorough research and networking can help overcome this. Resources needed include contact information, communication templates, and networking platforms.
Set up meetings with key stakeholders
In this task, the team will set up meetings with the key stakeholders of the shortlisted prospects. The meetings can be in-person or virtual, depending on the availability and preferences of the stakeholders. The goal is to have in-depth discussions, exchange information, and assess the alignment of interests. The desired result is scheduled meetings with the key stakeholders. The task requires strong organizational skills, effective communication skills, and the ability to manage multiple schedules. Challenges may include scheduling conflicts, but proactive communication and flexibility can help overcome this. Resources needed include scheduling tools, communication channels, and meeting agendas.
1
Meeting with Company A
2
Meeting with Company B
3
Meeting with Company C
4
Meeting with Company D
5
Meeting with Company E
Conduct Initial due diligence and company evaluation
This task involves conducting initial due diligence and company evaluation based on the information gathered from meetings and additional research. The team will explore various aspects such as financial health, market positioning, intellectual property, and potential risks. The goal is to gain a comprehensive understanding of each company's strengths and weaknesses. The desired result is an initial due diligence report that highlights key findings and risks. The task requires strong analytical skills, attention to detail, and the ability to analyze complex information. Challenges may include limited access to confidential data, but close collaboration with the company and external experts can help overcome this. Resources needed include due diligence templates, financial analysis tools, and industry experts.
Present Initial findings to internal team
In this task, the team will present the initial findings of the due diligence and company evaluation to the internal team. The goal is to gather feedback, validate assumptions, and refine the evaluation process. The desired result is a shared understanding of the findings and a consensus on the next steps. The task requires effective presentation skills, the ability to present complex information in a clear manner, and active participation in discussions. Challenges may include differing opinions among team members, but open-mindedness and constructive discussions can help overcome this. Resources needed include presentation materials, evaluation reports, and a collaborative platform for team discussions.
Approval: Initial Investment Proposal
Will be submitted for approval:
Identify industries and trends of interest
Will be submitted
Research specific companies within those fields
Will be submitted
Initial Screening of potential companies
Will be submitted
Create a shortlist of prospects
Will be submitted
Reach out to founders or key decision makers
Will be submitted
Set up meetings with key stakeholders
Will be submitted
Conduct Initial due diligence and company evaluation
Will be submitted
Present Initial findings to internal team
Will be submitted
Conduct advanced due diligence
This task involves conducting advanced due diligence to gain a deeper understanding of each company's operations, financials, legal standing, and potential risks. The team will analyze financial statements, legal documents, market research reports, and perform background checks on key stakeholders. The goal is to uncover any hidden risks or potential deal breakers before moving forward with the investment. The desired result is an advanced due diligence report that provides a comprehensive assessment of each company's viability for investment. The task requires thorough research skills, attention to detail, and the ability to analyze complex information. Challenges may include time constraints and limited access to confidential data, but efficient communication with the company and external experts can help overcome this. Resources needed include due diligence checklists, legal support, and industry experts.
Prepare investment proposal
In this task, the team will prepare an investment proposal based on the findings from the due diligence process. The proposal should outline the investment terms, expected returns, exit strategy, and any specific conditions or requirements. The goal is to create a compelling proposal that aligns with the venture capital's investment strategy and addresses the company's needs. The desired result is a well-crafted investment proposal that can be presented to the company's stakeholders. The task requires strong financial analysis skills, business writing skills, and the ability to articulate the value proposition. Challenges may include negotiating terms that satisfy both parties, but open communication and flexibility can help overcome this. Resources needed include financial models, investment proposal templates, and legal support.
Negotiate terms of investment deal
This task involves negotiating the terms of the investment deal with the company's stakeholders. The team will engage in discussions to find common ground and reach a mutually beneficial agreement. The goal is to establish a partnership that aligns with the venture capital's objectives and addresses the company's needs. The desired result is a finalized agreement on the investment terms. The task requires strong negotiation skills, understanding of legal and financial implications, and the ability to navigate complex discussions. Challenges may include differing expectations and objectives, but active listening and creative problem-solving can help overcome this. Resources needed include negotiation strategies, legal support, and financial analysis tools.
Draft legal and financial documents
In this task, the team will draft the necessary legal and financial documents for the investment deal. The documents may include a term sheet, shareholder agreement, subscription agreement, and any other relevant contracts. The goal is to ensure clarity and protection of interests for all parties involved. The desired result is a set of comprehensive and legally binding documents that reflect the agreed-upon terms. The task requires strong legal and financial expertise, attention to detail, and the ability to draft clear and concise documents. Challenges may include complex legal requirements, but legal professionals and template documents can help overcome this. Resources needed include legal support, template documents, and financial analysis tools.
Arrange funds for the investment
This task involves arranging the necessary funds for the investment deal. The team will work with the venture capital's finance department to secure the required capital. The goal is to ensure that the funds are available in a timely manner to proceed with the investment. The desired result is confirmed availability of funds for the investment. The task requires strong financial management skills, coordination with internal stakeholders, and compliance with legal and regulatory requirements. Challenges may include financial constraints and funding limitations, but proactive financial planning and communication with stakeholders can help overcome this. Resources needed include financial analysis reports, budgeting tools, and coordination with the finance department.
Approval: Final Investment Proposal
Will be submitted for approval:
Conduct advanced due diligence
Will be submitted
Prepare investment proposal
Will be submitted
Negotiate terms of investment deal
Will be submitted
Draft legal and financial documents
Will be submitted
Arrange funds for the investment
Will be submitted
Close the investment deal
In this task, the team will finalize and close the investment deal with the company. The documents and funds will be exchanged, legal requirements will be fulfilled, and any remaining conditions will be met. The goal is to ensure a smooth and successful closing of the deal. The desired result is a closed investment deal with all parties satisfied. The task requires strong coordination skills, attention to detail, and adherence to legal and regulatory processes. Challenges may include unexpected delays or last-minute changes, but efficient communication and proactive problem-solving can help overcome this. Resources needed include legal support, coordination with stakeholders, and compliance checklists.
Kick off post-investment monitoring and management
This task marks the beginning of the post-investment phase. The team will initiate the necessary activities to monitor and manage the investment. This may include regular communication with the company, monitoring key performance indicators, providing strategic guidance, and addressing any challenges that arise. The goal is to ensure the investment's success and maximize returns. The desired result is a well-structured and proactive post-investment management plan. The task requires strong project management skills, communication skills, and business acumen. Challenges may include unforeseen market or operational challenges, but proactive monitoring and collaborative problem-solving can help overcome this. Resources needed include project management tools, communication channels, and key performance indicators.
Create a report on the venture capital deal
In this task, the team will create a comprehensive report on the venture capital deal. The report should summarize the investment thesis, due diligence findings, investment terms, and post-investment management plan. The goal is to document the deal for internal reporting, investor updates, and future reference. The desired result is a well-documented and structured report that captures the key aspects of the deal. The task requires strong report writing skills, attention to detail, and the ability to present complex information in a clear manner. Challenges may include condensing vast amounts of information, but logical structuring and visual aids can help overcome this. Resources needed include report templates, financial analysis reports, and investment documentation.
Plan for potential follow-on investments
This task involves planning for potential follow-on investments in the companies that have received initial funding. The team will assess the companies' performance, growth prospects, and market conditions to determine the feasibility of further investment. The goal is to maximize the venture capital's returns and provide ongoing support to the portfolio companies. The desired result is a well-informed and structured plan for follow-on investments. The task requires strong financial analysis skills, market research, and the ability to anticipate future needs. Challenges may include market uncertainties and changing business landscapes, but regular monitoring and evaluation can help overcome this. Resources needed include financial analysis reports, market research data, and strategic planning tools.
