Venture capitalists (VCs) are clamouring to provide startups with value in addition to their capital. Many VCs promote these ancillary services as part of their value proposition. Services include strategy, attracting talent, board member introductions, and customer acquisition.
The combination of these services is often referred to as a VCs “Platform”. It is becoming a major focus in venture capital due to Andreesen Horowitz popularizing services for portfolio companies. Now, all other VCs want in – differentiators to set their fund apart. In particular, VCs are focused on helping portfolio companies acquire new clients.
Factors entrepreneurs consider when choosing a VC
Below are just a few of the things that entrepreneurs consider before choosing the right VC to work with.
Partners – One of the first things entrepreneurs consider is the kind of partners they have had in the past. If you have only helped one or two startups, you may not be a high-ranking business partner. Entrepreneurs often want to work with VCs that have supported a considerable amount of startups. The higher the number, the more confidence you will inspire.
Investment – The amount of money a venture capitalist has raised to support other startups is another important consideration. Most entrepreneurs are likely to go for a VC that has shown the ability to raise a huge amount of money to support a business idea they believe in.
Belief – When someone comes up with a good business idea, they are likely to get offers from many VCs. But such entrepreneurs are not just looking for capital. They are looking for someone that truly believes in what they want to do. Picking startups that you truly believe in is key to creating a strong portfolio that will endear you to a lot of entrepreneurs.
Client acquisition – It is not enough to provide capital. There are many things that go into ensuring that a startup is successful. One of those ingredients is the acquisition of new clients. As a VC firm, it is always a good idea to help your portfolio acquire new clients. This is one of the surest ways to keep the business running and profitable.
Top VCs helping startups get clients
Here are some of the VC firms that help startups get new clients.
1. Aleph
Aleph is an $850 million venture capital firm that has its headquarters in Rothschild Blvd 32, Tel Aviv-Yafo, Israel. The firm prefers to work with startups in the information technology, SaaS, big data, and artificial intelligence sectors. It partners with startups right from the seed stage, early-stage up to later stages of growth.
Aleph was established back in 2013 and has therefore acquired enough market experience to know exactly what it takes to make a business successful. That is why it provides its partners with helpful advice, facilitates client acquisition, and also gives financial support.
The company came up with an elaborate customer acquisition tool called Aleph connect. This tool utilizes the Ampliphy platform to connect portfolio startups to potential customers.
As a portfolio company, all you have to do is browse through the Aleph connect tool and choose potential customers you would like to connect to. Aleph’s team will then review your request and act accordingly to ensure smooth interactions and possible customer acquisition.
2. NEA
NEA focuses investment stages ranging from seed stage through growth stage across an array of industry sectors. With ~$25 billion in committed capital, NEA is one of the world’s largest venture capital firms.
One of the reasons why NEA has achieved success is that it helps startups acquire new clients. This is done by way of introducing different partners within its network. It also provides financial and intellectual support.
NEA employs a team of business development professionals to help startups find new talent, acquire customers, and attract new investment. NEA’s Vendor Platform enables
NEA portfolio companies to access to service information, exclusive discounts, and other benefits from recommended third-party vendors that provide valuable service(s) to support company growth.
Matthew Prince, Co-founder and CEO of portfolio company CloudFlare says “NEA stands out from other venture firms in two ways. The first is the breadth of experience brought by the entire team, and their willingness to collaborate.”
3. General Catalyst
This particular venture capital firm was founded in 2000. The firm focuses on early-stage and growth investments. It is one of the most unique venture firms because it does not just go around writing cheques for any startup.
Instead, it carefully selects startups that hold similar beliefs to its own. The company has a strong belief in building mutual partnerships. That is why it endeavors to work with entrepreneurs who share a similar passion, dream, and goal.
The company’s capital investments span different industries, including consumer, enterprise, and mobile sectors. Some of the companies that have benefitted from General Catalyst include,
● Airbnb
● Cadre
● Classpass
● Gusto
● Datto
● Livongo
● Hubspot
It is worth noting that General Catalyst once invested $10 million in Stripe’s ecosystem. This was aimed at helping about 20 startups acquire new customers and achieve more success in general.
4. GGV Capital
GGV Capital is a global venture capital company that was founded way back in 2000. It partners with various startups from seed stage to growth. Some of its investment ventures span consumer, retail, enterprise, and technology sectors. It manages approximately $9 billion in capital across 17 funds.
Not only does this company offer financial support, but it also endeavors to provide intellectual tools for companies to prosper. Training and consultations are among the things the firm offers to its partners. It also creates a conducive environment for its portfolio companies to build networks that can lead to growth.
Some of the companies that have partnered with GGV Capital include Thunes, WorkBoard, Grab, Nozomi, and Boss. BigCommerce is a particular example of a company that received funding from GGV Capital to help support new customer acquisition.
5. 8VC
8VC was founded in 2012 and had its headquarters in Austin, Texas. The firm is known to invest in seed-stage, early-stage, and later-stage companies. It has an affinity for working with entrepreneurs who have a futuristic approach to technology.
The firm manages approximately 2.7 billion in investments. Some of this firm’s portfolio companies include Wish, Illumio, Blend Labs, Oscar, Addepar, RelateIQ, and Oculus. The company believes in helping entrepreneurs achieve their ultimate goals, which is why it supports customer acquisition programs.
6. Redpoint Ventures
Redpoint Ventures was founded back in 199 and had its headquarters in California, United States. It boasts of having about $3.8 billion in assets. This firm invests in seed-stage, early-stage, and later phases of its portfolio companies. The firm strongly believes that supporting its portfolio to acquire new customers is key to ensuring overall success.
The Takeaway
Venture capital firms that make it to the top of any list are those that do more than just provide funding. These companies walk with their entrepreneurs every step of the way.
They offer educational workshops, hire talented staff, provide management support and even help startups build networks and acquire clients. The end result is not only the success of the startup but the venture capital firm itself.As a venture capital firm, you need to adapt to the changing dynamics of the world. Embrace technology and take advantage of resources such as those that are made available by SwitchPitch.