Be an Environmentor

Corrections or additions?

This article by Jeff Lippincott was prepared

for the October 11, 2000 edition of U.S. 1 Newspaper. All rights

reserved.

Courting Venture Capital

How do you know what to say to a venture capitalist

once you have determined that it’s time to take move forward with

your business plan? Learn the right way to approach venture

capitalists

at the New Jersey Entrepreneur’s Forum entitled, "What Do VCs

Want?" at McAteers restaurant in Somerset, Thursday, October 12,

6:30 p.m. Cost $45. Call 908-789-3424.

According to Ron Hahn, general manager with the Princeton-based

venture capital firm Early Stage Enterprises (ESE), venture

capitalists

are looking for investment opportunities that have the following

attributes:

1. A very clear explanation of what the new business is about.

2. A large market opportunity for the product or service in

question.

3. A management team that has a lot of experience in the

marketplace

and has the skills to sell a product or service to a customer

"We find one of the key ingredients is a CEO who can sell,"

says Hahn. "Ultimately a successful business sells products and

services and makes a profit, so the ability to sell is a key

issue."

ESE, founded in 1996 by Hahn and co-manager James J.

Millar,

has invested about $20 million in 16 companies to date, and has helped

those companies raise another $70 million through other parties. A

new partner, Kef Kasdin, has recently joined the firm from 3Com.

ESE (www.esevc.com) specializes in investing in companies in the

Mid-Atlantic region,

from Connecticut to Virginia, that are in the early stages of

corporate

life. ESE’s preferred first round investment ranges from $500,000

to $1 million. "Other venture capital companies would do a deal

for $5 million where we would never do one that large," says Hahn.

"ESE provides a level of capital typically earlier than most of

the venture capital firms nationally or in this region would tend

to provide."

"ESE tries to deal with the earliest stage of venture

capital,"

says Hahn, "and we’re prepared to make a seed investment in a

company that is not quite ready to sell a product or service."

According to Hahn, in some cases the investment is made at the end

of a sort of test-marketing phase called "beta-testing." Beta

testing is letting a customer use a product or service for free or

at a discount in return for the customer’s comments on what they liked

or didn’t like about the product or service and any additional

suggestions

the customers may have.

ESE also invests in companies that have completed beta-testing and

are ready to offer a product or service.

Hahn feels that there is an underserved market segment in the

mid-Atlantic

region for a third kind of investment his firm makes: Companies that

are selling products and services but with less than $3 million in

annual revenue at the time of investment.

What tips does Hahn have for those contemplating wading into venture

capital waters?

Put together a very professional business plan. "The

business plan should be a document that the management of the company

creates and should talk about the market opportunity that the company

is going after, the innovation that its product or service makes in

the marketplace, who the management team consists of, the business

potential, and financial objectives."

"It’s surprising, sometimes we get business plans and we read

through them and we actually can’t quite figure out what their

business

is," says Hahn.

Get a referral. ESE gets over 1,000 proposals per year

but will make perhaps four to six investments per year. The best

chance

to get the attention of ESE, or any venture capitalist, is to be

referred

by people they know and trust in the community.

Be prepared to give a professional presentation.

"You’d

be surprised how many people come into our office and ask us `What

would you like to know about our business plan?’ We need to see how

you are going to approach potential new customers."

Hahn got bit by the entrepreneurial bug while earning his MBA

at UCLA. A professor had asked a group of students to go out a find

a company that would permit the students to come in and do some free

consulting. "I became fascinated with the entrepreneurial

personality

— somebody who takes significant risks to build a business

opportunity,"

says Hahn.

Hahn sees a lot of interesting technologies but feels that often the

missing ingredient is capable management. To be successful in getting

the interest of venture capitalist Hahn advises, "Put together

a management team that has the right kind of background and

experience,

because that is what will impress us."

"People who should approach us are those who have taken some

action

to make the business a reality. They still need capital to get from

here to there. And even though their accomplishments may be at a very

early stage, they’ve done something that convinces us that it truly

is a real business opportunity."

— Jeff Lippincott

Top Of Page
Be an Environmentor

Most people are very busy, with very little time in

their schedule available for volunteering, but I suspect that some

people would be eager to help transform a young person’s life,"

says Maureen J. Quinn, director of the NJ Environmentors Project

on Lawrenceville Road.

Quinn launches her a recruiting campaign with a kickoff meeting for

volunteer mentors on Thursday, October 12, at 6:30 p.m. at the Rider

University Science & Technology Center, Room 102. E-mail:

mquinn@environmentors.org

or call 609-278-5844.

This multi-cultural, one-to-one mentor program helps high school

students

decide on their educational career goals — and then helps them

meet those goals. Volunteer mentors are matched with a student to

work on an eight-month project, which they choose together. The

project

must involve an environmental issue that can be researched and tested

scientifically. The pair work on the project together for two hours

per week. The result: a classroom lesson taught by the high school

student and an entry in the EnvironMentors Fair.

Plus a big increase in the self esteem of the student and, claims

Quinn, lots of fun for the mentor. Mentors do not, by the way, need

to be an environmental professional, and they get plenty of training

and support.

"I’ve seen the students that I mentor change their outlook about

the importance of protecting the environment in just a few short

months,"

says John J. Rosania, who has been an NJEP mentor for three

years. "The project gives students the opportunity to interact

with another adult, aside from their teachers and parents, that they

have common interests with. These interactions help the student to

grow as a person, gain self confidence, and most importantly, have

someone to look up to. You cannot put a price on this."


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