Relevance featured in Inc.
Apr 6, 2023 | By Jill Krasny
If there’s one thing we all know about business, it’s that no cycle lasts forever. Courses correct. Pendulums swing. Bubbles burst. What goes up comes down. So it is for entrepreneurs seeking funding in 2023. After a year of record investment activity in 2021 among U.S. venture capital and private equity firms, rising inflation and recession fears led to a precipitous drop in funding in 2022: The value of VC deals fell by more than 30 percent year-over-year, while PE dealmaking declined nearly 20 percent, according to PitchBook. Then, in March, Silicon Valley Bank failed, shaking up the VC world. Now more than ever, investors are focused on fundamental analysis. Or as Cameron Newton, founder of VC firm Relevance Ventures, says, “People want to see the data. How are you a sustainable business?” A reasonable question at any time. But now—while times are tight, and VCs are sitting on a record $300 billion of dry powder—would be a good time to fine-tune your pitch. So how do you land that investor meeting? Here’s what seven VC and PE investors say they want to see before writing a term sheet.