Learn how VCs work and the types of deals they look for in an interview with Sammy Abdullah of venture capital firm DAN Fund LLC.
Today’s guest is Sammy Abdullah. Sammy chairs the board and manages day to day operations of DAN Fund, a venture capital firm in Dallas, Texas. The firm focus on mid-stage venture opportunities, defined as companies with 18+ months of revenue and attractive quarter over quarter growth. DAN Fund prefer recurring revenue models focused on enterprise customers or higher end consumers.
They invest anywhere in the U.S. or Canada, especially in markets most VCs overlook like the Midwest and South. They are currently investing out of their second fund, and their check size per opportunity is $500,000+. They can close and fund a deal in as little as four weeks.
Topics discussed include:
- The primary investment stages entrepreneurs go through
- What venture capital firms typically look for in opportunities
(From “friends and family” to angel investing, followed by a seed round, Series A, Series B, Series C, Series D, etc.)
- The average deal fund sizes for seed rounds to later stage funds
- Why going to a VC too early can be a waste of time (unless you have a strong prior track record)
- What VCs like to see in early stage companies
- Top turn-offs for VCs
- The equity levels that company founders should expect at various funding rounds and other ways they are incentivized
- Trying to get advice from VCs? (what you can expect)
- Key tips to hone your elevator pitch
- The “herd mentality” of VCs and how they work together on deals and referrals
- How to find and network with VCs
- Where VCs look for up-and-comers
- Older vs. younger entrepreneurs—who’s more attractive to VCs? (Sammy’s take)
- Companies in DAN Fund’s portfolio (including DivvyHQ, leveleleven, SpotHero, Need, Take The Interview and ImageVision)
- Why entrepreneurs should avoid raising too much convertible note (and how to make sure your cap table is relative to your funding stage and future plans)
Photo credit: Tax Credits
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Also published on Medium.