I spoke with Tim Draper, the Founder and Managing Director of Draper Fisher Jurvetson, a leading Venture Capitalist about fundraising tips and the process of getting funded.

While his firm is investing in areas such as Clean tech and Healthcare, Tim shares he is looking for ideas that are critical to a new industry or can turn an industry on its ear - example the media business which is now a typhoon of chaos and a good opportunity for new ventures.

He sheds light on the mysterious dark waters of fundraising (for the entrepreneur anyway) and admits that its a mystery to him too - how refreshing! Here’s the quick process overview:

1. Begins with the business plan which does need to cover some basics. Where does the team come from, their education, is this what they were “meant to do”, is the market well understood, and competition analyzed.

2. The First cut is whether it’s a big enough market - as in the total available market of over $1billion

3. The Next cut - what is the approach to this market and how to capture it

4. Then comes the question about technology and whether it’s feasible

5. Finally, it’s time to meet the team and from that point it’s all about the people. Are the individuals completely driven to doing what they are doing - deep in their soul and not just for money. It’s also critical that the team get along - are they talking over each other or do they have respect for each other - ideal is a driven ceo who is surrounded by people who support and believe in him.

Listen in to the interview to hear about their decision process and the key reasons for rejecting a deal.

So how does Tim pick his deals? “It’s a feeling driven by a big enough market, where the product is unique, the team is moving ahead and people want to jump on the boat although the masses don’t want to do this yet.”

 
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