What are the best time cycles to approach a VC firm?

ImageIn an earlier blog, I had stated that the best time to raise capital is yesterday.  Of course, this response does not mean that you should approach a firm at any time of the year.  There exist rhythms and cycles when to contact a firm. Timing is key here.

There are two major time periods to reach out to a VC firm.  When Fall approaches, the first cycle begins around the second week of September and ends just before Thanksgiving.  The second cycle starts after the second week of January and ends near the end of June. Although these are not hard fast rules, these two cycles represent the management styles of a partnership of fairly successful investment firms.  Many partners take extended vacations.  A common travelling spot for a partner is fishing off the Alaskan coasts.  Others journey through Europe or other exotic locales. These long trips, often at inaccessible spots, clearly dampen any possibility for the firm’s total management team to look at deals and agree on making the investments.

And since the firms operate as partnerships with limited partners, the common partnership management is to reach unanimous consensus on any investment being made.  Generally, these meetings need to be face-to-face.  An out of pocket partner will forestall any final determination or evaluation of a decision.

Another factor in the timing process is to consider the availability of funds managed by the firm. The closer the calendar reaches the end of the year, the size of the fund might be closer to depletion.   Earlier during the Fall is far better than closer to Thanksgiving.  The beginning of the New Year is easier than waiting until the beginning of the summer.  Usually the funds are

Imagereplenished at the beginning of the cycles when there is more capital available for investments.

Still a start-up should not compromise on the quality of the work.  Instead, the managers should take advantage of the down time to increase sales, clean up the paperwork, and begin to prepare for the beginning of the funding cycle. But if that start-up needs to increase its chances for funding, it should fully aware of the cycles.


About Juan Ramón Zarco, SVVGP 胡安•雷蒙•扎尔科

Juan Ramon Zarco, 胡安•雷蒙•扎尔科, Silicon Valley Ventures Growth Partners llp, Hygieia Healthcare Technologies Company, AllRest Technologies LLC, Crimson Growth Partners LLP, jrzarco2001@yahoo.com, is an experienced as CxO, General Counsel and Secretary to public and private companies with global operations. Established track record of producing practical, revenue-focused solutions. As Counselor and Secretary, demonstrating vision, integrity, and sound business judgment, to CxOs. Managed complex, strategic transactions, M&A, contracts support, PE Financing, IPO, SEC compliance, Corporate/HR governance, IP licensing, Budgeting, Staff, outside counsel management, International market access strategies, Domestic & foreign government relations and advocacy. Creative in designing and implementing market access strategies. Practices law beyond conventional model with low-overhead and project-based fees. Effective at managing departments, formulating marketing strategies, balancing budgets, and implementing cost-saving measures. Extensive in-house and private practice experience, advising clients on commercial, corporate, international business, and technology law and policy. http://www.docstoc.com/video/89135472/make-your-business-an-international-presence; http://www.youtube.com/watch?v=fx5gijf3yoc For Sprint, he managed iDen international development in Southeast Asia, Middle East, and Africa, and contractual issues with Verizon. In Private Equity, he worked with Pegasus in vetting international investment deals and interim President for portfolio companies, such as Data Foundation, a data storage company, handling marketing, strategy, fund raising, and accounting. Before Pegasus, Mr. Zarco, as CLO and V.P. of Corporate Development, played a principal role in the structuring, international expansions for 2 telecom companies, U.S. Cable Group and Viatel, Inc. in financing and M&A deals exceeding $200 million. Mr. Zarco earned a J.D. from NYU Law School, M.B.A. from Cornell, and B.A. from Williams College; is fluent in Spanish, Portuguese, French, and German, with working knowledge of Russian, Arabic and Japanese.
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