Editor’s note: Jim Verdonik, one of the best-known and most active lawyers dealing with high-tech in the Southeast, is a member of the Ward and Smith, P.A. firm.
RALEIGH, N.C. – For a number of years people involved in various technology based businesses have been waiting for the next venture capital wave.
VC waves happen when VCs drink too much and start throwing money at anything that moves.
That long awaited binge hasn’t happened, because the VC industry continues to shrink. While a few hearty local VCs continue and have been supplements by accelerators who invest small amounts, a huge financing void remains – especially for early-stage technology and science based businesses that need more than $100,000.
Public Private Placements with or without advertising (soon to be augmented by Crowd Funding) has begun replacing venture capital as a primary financing mechanism for growing companies.
In private placements you cobble together your own deal with multiple investors instead of negotiating with one lead VC.
There are pluses and minuses for growing businesses in this capital raising shift.
I’ve included [a link to an article published in Triangle Business Journal] about how you deal with investment risk in private placements in a different way than in VC investments. Like most of my articles, it’s based on the challenges my clients are facing.
I hope you find this article useful.
See you on the capital raising trail.
If you would like to learn more about learning how to grow your business or other issues important to your success, you can reach me at JFV@WardandSmith.com or JimV@eLearnSuccess.com.
Or you can check out my eLearning course at http://www.elearnsuccess.com/start.aspx?menuid=3075
or http://www.youtube.com/user/eLearnSuccess
You can purchase my books at http://www.amazon.com/Jim-Verdonik/e/B0040GUBRW
Verdonik’s blog: http://jimverdonikintersection.blogspot.com
