You’re in a meeting with an angel investor whose funding could jump-start your v
ID: 354278 • Letter: Y
Question
You’re in a meeting with an angel investor whose funding could jump-start your venture. How would you feel if you had to answer the investor’s questions with “I don’t know” several times in a row? . Why do you think VCs tend to “bury their dead quietly”?
What is meant “crowd sourcing” in the context of financing ventures? Why is it an increasing possibility in the years ahead? Use some examples to make case stronger.
Research and find just ONE project that was “crowd funded”. Was it successful? Why? Is there an alternate way to fund that particular project? (It could be profit or nonprofit, public or private). Ted Talks contains quite few of these projects and of course, you can search “crowd-funding” sites.
These are not long essay type please answer all
Explanation / Answer
If a person is answering I don't know to the angel investor several times in a row then he is not prepared well for the meeting and he is not through with his business plan or concept. The VCs bury their dead quietly because the companies funded by them do not die easily as compared to other startups in the market. The investors bail out or the startup will have the last round of funding over an average of 20 months of terminal illness. So the VC companies will have to make it a low profile and finish the business with these companies.
Crowd Sourcing is the latest concept or method to raise funding directly from the normal people. The company will founder will tell the business plan and ask if people believe in his idea. If they believe then they can invest in his project and if the project is a success then the founder will share the profit with all the people who have invested in the company. If the project is a failure then the people have no rights to ask for their money. This method is continuously growing and also becoming very popular among the latest entrepreneurs. This way the founders do not have to go to the investors and seek investment. If they are confident about the business plan then they can take money from the people who believe in the project. There are many companies which were funded by crowdsourcing and they are quite successful now. Some of the examples are Pebble, SkyBell, Hidden radio 2, Elevation Dock, The Glif etc.
I would like to talk about the movie that was produced using crowdsourcing. The project took place in India and the director was new to the industry and he did not get the producers to invest in his movie. So he went to crowdsourcing and this was the first movie to be made using the money raised by the normal people. He received as low as 1 dollar as an investment and he successfully finished the project after 1 year with a good amount of money collected. The movie was a huge success and it saw a worldwide release. It was a success because the director was very confident of the movie story and his ability to direct the movie. Even people realized his potential soon and decided to invest in his venture. The director and the producer of the movie then divided the profit among all the people who contributed to the success of the movie. The alternate ways to fund this project was the traditional way of approaching the producers and asking them to invest in the movie or self-investment where the director of the movie will put money in it to complete the movie.
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