Michael Shoemaker is president of Wellspring FV in Lancaster, Pa., which helps developing technology companies get off the ground.He
describes the venture capitalists of yore as passive investors, while today's catalyst firms are actively involved in a company's rise to success and profitability.
"We help develop the proper business model and play an active role on the management team of our companies," Shoemaker
explains."We bring experience in sales, marketing, accounting, personnel, strategic planning...in essence, all aspects of business management."
Anderson's firm works in much the same way.Her
background as an executive in several Silicon Valley companies has given her
broad experience in dealing with senior-level business issues.So she
has served in many key roles for the companies that have come to Catalyst Partners for help until they could hire their own experienced staff."I've been vice president of marketing, vice president of sales, vice president of engineering, whatever operational role was necessary, for the length of time it took to recruit and hire the right person to fill the job for real," she
and Anderson both put their expertise to work in helping to hire key senior level staff, first by outlining what skills are needed and then by making contacts to find the talent.
"When a company is able to afford to hire its own managers, we assist in the hiring and then get out of the way," Shoemaker
Wooing And Winning The Big Bucks
While venture catalysts bring their time and talent to the table to strengthen a young company operationally, they know that it's all in preparation for reaching the ultimate goal - securing the cash lifeline.
"Everything we do with our companies helps to put them in position to be attractive to investors," Shoemaker
says."Our involvement tells an investor that this company has a solid plan for growth and they can expect a desirable return on their investment.Once you can prove the business model, getting the money is easy," he
But Anderson cautions that venture capital won't work for everyone."Just because you want a venture capital deal doesn't mean it will automatically come along," she
says."You need to have your house in order for the opportunity to appeal to the investor.And you have to decide whether you want someone in your shorts like that.There are other means of financing for young companies."
agrees."The Rolodex is very important in this business."
says when he
rolls up his
sleeves on behalf of a company his
goal is to work with them for no more than two years."We ease ourselves out but stay involved in an advisory capacity, maybe on the board," he
says."By then we've helped to build the company and it's time for us and them to move on."
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