In the startup ecosystem, there are few companies that reach the point of raising venture capital. However, the funding type has become synonymous with startups, especially those that are high-growth-oriented.
The Startup Savants podcast was joined by Jules Miller, partner of international venture capital firm Mindset Ventures, to discuss the basics of raising capital for startup founders looking to take their startup to the next level.
- Startup Savants is a business podcast that tells the stories behind up-and-coming startups.
- Jules Miller is a former startup founder and current venture capital partner at Mindset Ventures.
- Mindset Ventures is an international venture capital fund.
Tell us a little bit about your background and how you got into venture capital:
“I did not expect to be a venture capitalist. I started as a founder myself. Well, first, I was in the corporate world. I actually started a big four accounting firm, so not maybe the most traditional entrepreneurial path, but I was an entrepreneurial person. I started two companies. And just once you get in it, it’s very hard to go back and do something different. So the more and more I got into the startup world, especially high-growth tech startups, which is what I tend to focus most of my energy on. I just decided that this was the only thing I could possibly do with my life.”
What does your venture capital firm do?
“We, at the end of the day, are like a service provider. We provide financing to a very particular type of company, and we can talk about what is a good candidate for venture capital and what is not a good candidate for venture capital. But at the end of the day, I get to hear a lot of really exciting ideas. See really incredible founders execute on those ideas, and hopefully change the world in some small, little bit.”
What is the difference between angel investors and venture capitalists?
“Angel investors are individual investors who are usually investing their personal capital. That means I have some money in the bank, and I decide that, instead of buying real estate or spending it on other things, I want to invest in high-growth startups. That’s an angel investor. Usually smaller check sizes [and] faster decisions, because they don’t have to talk to anyone else. They’re doing things on their own. And they also tend to not set terms and lead deals in the way that traditional venture capital funds will.
A venture capital fund will invest a check, and we are professional, full-time dedicated people that are doing investment as a career. And we usually also have raised funds from outside LPs (Limited Partners).”
What types of startups should consider venture capital?
“Venture capital is diversified as an asset class in some way, meaning we’re all looking for high growth, we’re all looking for big returns in a reasonably short time period. So five to eight years is typically where we’d want to see an exit. Meaning you go from me writing a check to you returning my capital, either through an acquisition or an IPO in a pretty short time horizon. That being said, there are different stages of venture capitalists.
I invest in seed to Series B. So typically, that means there’s some sort of product launched. There’s some sort of traction and product-market fit. There’s some sort of ability to sell. And there’s some sort of ability to show that you can scale the business. There are lots and lots of really great venture capitalists who focus on pre-seed and seed, which is the idea stage, MVP stage, not as much as I need in order to make an investment for my fund, and then there’s growth, so I’m kind of in the middle there.”
The Startup Savants Podcast
Startup Savants is a podcast brought to you by The Really Useful Information Company (TRUiC), telling the stories behind startups, the founders that run them, and the experts that help them succeed.
On the podcast, hear interviews with entrepreneurs during launch and scale as well as experts and authors in the space about the intricacies of startup culture and entrepreneurship.
Final Thoughts
Whether you’re looking to raise venture capital yourself or get a behind-the-scenes look at startup funding, Miller provides insight into the venture capital world, and the steps founders can take to create better pitches and identify the right investors for their companies.
You can find the Startup Savants podcast on Apple Podcasts, Google Podcasts, or wherever you listen to podcasts.
