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Top Five Things VCs Want

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by Al Goldstein, CEO of AvantCredit

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Competition for venture capital is fierce, especially among startups. This article will talk about the things VCs and funding experts look for and what’s most likely to win them over.

Below are a few characteristics VCs and funding experts look for in a startup.

1. CEO Track Record.

Navigating the startup scene is a challenging task so it is important to have a CEO at the helm with a proven track record.

Plain and simple – investors are more likely to fund a startup that showcases potential and that starts with the executive team.

2. Team with Top Talent.

The founding team of any startup should have strong expertise within their given industry. As a startup continues to grow, the specialized team is responsible for transforming the vision into reality. Implementing a strong management team across diverse functions of the business is imperative for allowing a startup to scale effectively.

3. Market for the Product.

The larger the market for a given product or service, the greater the potential of the startup. For example, U.S. consumer credit makes up a $12 trillion market, yet few consumers have access to responsible credit. The demand for credit, however, is there. This void in the lending industry coupled with demand for the product makes online lending companies such as AvantCredit an attractive prospect for investors.

4. Winning Business Model.

A winning business model will address an issue within the marketplace by providing a viable solution. AvantCredit’s mission is to transform consumer finance by lowering the costs and barriers of borrowing and overcome the substantial reduction in available credit for the average American. Through the use of big data and an advanced machine-learning model, AvantCredit is able to override outdated FICO scores and determine the creditworthiness of candidates based on other factors to mitigate risk.

5. A Competitive Edge.

Investing in a startup is a numbers game and in order to effectively attract and close rounds of funding, a startup needs to separate itself from the rest of the pack by highlighting its competitive edge.AvantCredit’s competitive advantage stems from its ability to accurately analyze borrowers using machine-learning technology.

 

Al GoldsteinAl Goldstein is the CEO of AvantCredit, an online lending platform. AvantCredit was Chicago’s most funded startup in 2014, with over $1 billion in funding to date, including investments from Victory Park Capital, Tiger Global Management, Peter Thiel and Jefferies.

 

 

 

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