The previous post discusses four key individuals working in a venture capital firm. They begin with analysts (the most junior positions), associates, principals, and partners (the most senior positions). However, they are not the only things to know about venture capital. Three other positions play key roles in the firm. They are venture partners, Entrepreneur in Residence (EIR), and Limited Partners (LPs).

Things to Know About Venture Capital: More People at the Firm

Besides people working in the VC firms, there are other important figures. They may not be the immediate parts of the VC firm. However, they play strategic roles in the success of the firm.

• Venture Partners; they are not directly involved in the firm’s daily operation. Instead, their primary roles are building new deals, which they refer to the firm’s partners. They commonly get some carry interests from the referral.

• Entrepreneurs in Residence (EIRs); Their main role is helping the VC firms earn cash. They are usually hired for a year or more, depending upon the firm’s needs. They help the VC in analyzing incoming deals.
• Limited Partners (LPs); They are actually the investors of the venture capital firms. LPs can be institutional such as endowments, sovereign wealth funds, corporate pension funds, wealthy families, individuals, and even funds of funds.

Things to Know About Venture Capital: How to Get Fund from VC

Other basic things to know about VC is how to get funded by the firm. This is particularly important for startups that are looking for additional working capital. However, not all VC firms may suit your business. Therefore, you need to make sure first that the VC firm fits the core of your business.

You can make a list of target VCs, which have some similarities in common with you company. Then, follow the steps below from Alejandro Cremades, a Forbes contributor.

Make an Introduction

Make a list of VC entrepreneurs that may also invest in your vertical business. See who you are the closest to you and in a position to make an introduction. If possible, choose one, who has given good returns to the VC firm. This is the best introduction you can make. The VC firms may see the introduction as the proof of social relation and success. The better this phase is, the more your chances to get funded by venture capital.

Make a Call

After the successful introduction, do not miss the chance to make a call. This is particularly important if the VC shows an interest in your business. If you have not made any direct communication with the target partner, you can do it by means of the VC entrepreneur who introduced you before. However, you already have direct communication, perhaps, he will ask you to send a short presentation about your business.

How to make a great pitch deck is also one of things to know about venture capital.  Do’s and don’ts in making a great investor pitch deck has been discussed in a previous post on how to start a business. Keep reading the next posts for more details.