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Question added to topic MoneyAugust 23, 2007

As an entrepreneur visiting Chicago from Mexico, what kind of investors should I be looking for? Venture capital or private equity firms?

As an entrepreneur visiting Chicago from Mexico, what kind of investors should I be looking for? Venture capital or private equity firms?
Your email question doesn't provide information that would help me answer you. Where you are visiting is irrelevant. Where you are from is irrelevant too. What matters for this question is the business itself, what it is, where it is, and what its prospects are. Generally, venture capital is for start-ups and early growth businesses--businesses that intend to go public or be acquired but are still too early in their history. Private equity deals in these kinds of businesses plus older and more established businesses.
<p>You won't get venture capital unless you have a proven management team and a believable high growth rate with defensibility. Venture capital firms make about 5,000 investments per year, out of 650,000 business start-ups in the U.S. If your investment is in Mexico, then you're going to have to have all the above plus venture capital firms familiar with Mexico, which is tougher. Venture capitalists are paid to invest in other people's money to maximize the return and minimize the risk. They don't like the introduction of a new variable -- Mexico -- to add to the risk. If you're from Mexico but operating in the US then investors don't care about that. Investors don't care where you're from or where you're visiting: They care about what you know, what you can do, how you can make them money, where your business is, and how investing in your business can make them money.
</p>If your business is in Mexico, then look first for investors in Mexico. I did a quick google search and I did
come up with some venture capital in Mexico, for example Sierra Madre
in Monterrey and
a few firms in Mexico City. There are also the government
development agencies like
Nacional Financiera. It's way more likely you'll find investors for Mexico in Mexico than outside Mexico. If you have some reason you haven't explained for seeking investors outside Mexico, then find investors who know Mexico and have invested before.

Tim Berry is the president of Palo Alto Software Inc., based in Eugene, Ore., which produces business planning software. He is also the author of 3 Weeks to Startup and The Plan-As-You-Go Business Plan, published by Entrepreneur Press.

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