1) Build a list of start-ups
2) Use available sources to capture information on stage, amount of funding, sector and focus
3) Narrow selection by using the product to find ones of interest
4) Engage with the teams to identify improvements and give feedback – be a power user and ambassador---------------
Something that often comes up with conversations with students is how to research the entrepreneurial market, identify potential interesting start-ups, and even who is recruiting right now. This also relates to questions that a venture capital firm will ask you during the interview process, so will be good to cover.
While they are slightly different beasts, there is some overlap and will certainly be helpful to know the start-up scene before going into interviews. Knowing the local scene will help get an understanding of what up-and-coming companies are showing the right characteristics to get funding, while also knowing what more established (and better funded start-ups) are doing to get the attention from venture capitalists.
Plus, its an opportunity and also just to demonstrate your knowledge of the entrepreneurial ecosystem in London, Berlin, Europe and further afield and genuine interest in the industry.
Filling the funnel
Create a list of potential targets using the sources below. These links can be used to fill the top of the sourcing funnel for the first filter.
1) Scour the websites of venture capital funds – each firm will have a list of portfolio companies (and likely which of those are hiring right now – for those of you looking for jobs)
2) Crowd sourced tech maps – Resources section has lists per geography
3) AngelList, and recently launched CapitalList (UK’s version of the AngelList) will have entrepreneurs showboating their start-ups
4) Crowd-funding websites (and also handy to have information on their fund-raising so you can calculate valuations)
5) Ventureloop – start-ups that will be recruiting will have likely recently raised money and be on a hiring spree
6) Start-up Competitions – the major UK competitions regularly list top 100 start-ups and have user voting
7) Angel Group Portfolio – as with venture capital firms, Angel Groups (London Business Angels for example) will have a list of portfolio companies on their website
8) Networking events – usually for pre-funded start-ups, there are many great Meetups and events for meeting early stage companies if you are looking to be one of the first few on the team
First Round of Due Diligence
The sources above will create a long list of start-ups, the next stage will be to capture more basic information about them (Excel / Google Doc works quite well here).
Use the following resources to find out about funding, stage, team sizes, and product focus – will be enough information for now to start narrowing down interesting companies by stage / sector / focus / size. More to come on this later…
1) Crunchbase – public database profiling start-ups
2) Venturebeat Profiles – another public database for start-up profiles
3) AngelList – start-ups version of Facebook
4) DueDil – London based start-up that houses information about private companies
5) Venture Capital firm website – many websites will profile the start-ups and occassionally detail funding rounds or interviews with founders
6) Start-ups website / Press Releases / Blogs – nothing like a bit of self made PR…
7) Tech blogs – cover the news sites to understand who is raising money and planning further growth
8) Capital IQ - ask for access at your business school library and use it to pull up recent acquisitions / investments (it's not just for bankers!)
Use the product…
Now the list will start to be taking shape for sectors, stages and sizes. There is nothing like using the product, so with your own preferences (by stage, funded / not funded or whatever is your interests) – use the product!
Really use it, log in daily, use the web version, use the mobile version, use the iOS and Android versions, even try to use the Windows Mobile version.
Take a stance on the product – what could be improved, what could be changed, what do you like, what do you dislike? Use the product daily, many times over in order to really understand what the team are building and think of the future vision that is being shaped.
If you are going for a job at a start-up, many applications request either feedback on the service / product, or they ask for your profile link – and they will check to see if you are as a passionate user as you claim to be… I’ve had many people trying to apply for jobs, without having ever used / seen the product – you will be found out, and you will be out the door.
Be prepared for the interview, and show that you are a truly first adopter of the service – become an ambassador and sell it! During venture capital interviews, you will be asked about what portfolio companies you like, and what competitors portfolio’s you like / use – so this is just as valid for those looking for a vc internship or start-up role.
Take it one step further
This will have taken quite some time to get this far – you may have to be using the product for a couple of months or more! If you really want to set yourself aside from the competition, take it to the next level by engaging with the staff by giving product feedback and suggestions of how to improve the experience.
Get a feeling of what the future growth plans are, read news articles, blogs, twitter feeds, speak with the employees – offer to do work for free, fashion an opportunity to show your skills and abilities. Also, it will give you a lot more insight into the company, the team, it’s vision for the future – all points that can be discussed during interviews for internships at venture capital firms!
So, get out there, build your funnel, filter it to the sectors and stages you wish to target (play around and get a feeling of the wide variety of start-ups out there), then target a select few to do deeper due diligence and engage in any way you can – tweet, email, blog, present, follow, whatever channels work, just don’t give up!