Before we present the venture capitalists and angel investors that are looking to invest in Barcelona start-ups, let’s give you a few tips for you to choose the right investor.
Did I just say that YOU can choose? Yes, I know we are in trying times, but you do NOT want the wrong investor. Signing an investor to your start-up is almost as big a commitment as having a baby with him. (Yes, still, sadly, the vast, vast majority of VCs are Hims, but that’s another rant for another day.) Once you sign, you are really stuck with that investment firm for the long haul.
One of the most common mistakes first-time entrepreneurs make is to accept the first influx of money offered. And, yes, we are in an environment of risk takers and gamblers, but not asking the right questions, not only puts your baby business in danger, it also could make you lose that deal in the first place by not seeming conscientious enough.
So before we offer you the names and numbers of some Barcelona-focused investors, here are some tricks to finding the right investing partner to join your team. Think you know it all already? Scroll down to find your next lead!
8 Things to Remember When Considering an Investor
- Learn from others. Check out TheFunded.com. It’s a shockingly ugly webpage for a great tool. Like Yelp! for restaurants, TripAdvisor for hotels, or GlassDoor for corporations, TheFunded allows start-ups to rate investment firms, so you can get an insight into the good, the bad, and, sometimes, the ugly.
- Talk to their current clients. Any good investment firm should be proudly promoting their current partners, which you should be able to find readily on the VC’s website or an angel investor would be happy to email you a list. As you get further into negotiations, you’d be remiss not to contact their previous partners to learn of their experience.
- Ask a LOT of questions. In this economic climate, it may seem safer to accept the first offer you get. But investment is a two-way street. You need to be sure you want to work with them. Yeah, they are risking some of their money, betting on you, but you are risking your whole world by going to bed with them. Ask open-ended questions and even repeat them to make sure that you have all the answers you need before jumping under the covers.
- Know your limits. Make sure you and your team agree unanimously on how much of your company you are willing to give up and for what. Define a specific investor threshold and the influence you want them to have. These are some of the first questions potential investors will ask and you have to be ready to answer them.
- Know what you’re looking for. Do you want experienced investors or risk takers? Do you want them to be stronger in tech or marketing or what? Do you want a mentor or a better network or both? A CFO to come on board? Where do you want them to be based–do you want them nearby or are you trying to get a foothold in maybe China, LatAm or the Silicon Valley?
- Observe non-verbal behavior. You will be with this person in meetings for months and even years. Do they make eye contact? Are they Crackberry addicts or answer their phone during meetings? Do they cut meetings short? Do you really think they are listening?
- Consult a Lawyer and an Accountant. You need to consult the semantics and numbers guys before signing this marriage contract. A reliable lawyer and a dependable accountant is always a good investment, to make sure that your next deal maintains your controlling interest and is the right amount of dinero for your business right now.
- Don’t be afraid to say NO. Nowadays, it may feel like this is the biggest risk. Listen to the advice of your lawyers, accountants, mentors, other entrepreneurs and especially your teammates. Then listen to your gut. Accepting investment into your business and the relationships that come with it is one of the biggest commitments you’ll ever make.
Now, for those ready to take that big leap, here are those investors…
7 Venture Capital and Angel Investors With Their Eyes Set On Barcelona
“Helping Entrepreneurs Make Their Dreams Come True.” Inveready specializes in TIC and BioTech and contributes around €100,000 toward seed rounds and €1 million to €1.5 million for Round A. Overall, they are looking for companies that need €200,000 and €4 million over a four-year period of commitment. They are a Spain-founded company with offices in Madrid and Barcelona, as well as in the coveted San Francisco.
Connect with them at: http://www.inveready.com/en/ or 931 80 72 60 or Carrer dels Cavallers, 50, 08034 Barcelona
As its name suggests, this is a Spain-based crowdfunding site, which is useful since Spanish-owned or Spain-based start-ups are still not welcome on the big names like Kickstarter (though it looks like that will open up in 2015.) It basically enables anyone to be a business angel investor in tech companies. It’s free for start-ups to join, but they claim to perform a rigorous selection process. The website is very focused on the investor side, while lacking a compelling case of why you as a start-up should put your company up on there. If you have some money tucked away, this might be an interesting site. It allows you to buy a €3,000 ticket, from which you don’t have to put eggs in all one basket because you can instead invest in (or bet on) multiple startups. At time of publishing, The Crowd Angel have had 3,242 investors signed up so far with €1,940,000 invested. The handful of start-ups on the site were all more than 100 percent funded, between €100,000 and €300,000.
Check it out: at http://www.theCrowdAngel.com
This two-year-old business angel firm agrees with us by saying “A start-up is a place to ask questions.” Sitka focuses on internationally minded innovative tech-based start-ups with growth potential, concentrating on seed round investments. They are looking to invest more than €50,000 in each start-up. They currently boast five clients on their website, from gamification to a sports social network to a few ecommerce tools.
Check them out at: http://www.sitkacapital.com/
The Internet and mobile apps investor says it is “Smart money for big ideas” and are only interested in start-ups looking for investors who are very actively involved. Let’s first talk about what 101Startups assures they are NOT interested in: no ecommerce or marketplace apps nor anything industrial nor in publicity. They are also looking for internationally minded, unique companies that are virgins, with no big investments already and valued under €4 million. And now, what they are looking for:
- Clear and Scalable Business Model
- Well-balanced team fully dedicated on project
- Global vision
- Attractive potential market with a solid client base
- Has some traction — minimally viable
They currently boast 14 start-ups.
Check them out at: http://www.101startups.com/ or Rosselló 255 5º2º, 08008 Barcelona
NeroVentures are focused on growth-stage companies in the tech world. They self-identify as actively involved with investments, concentrating on reducing operational risk. This fund is made up of VCs and CEOs of other tech companies. They have offices in four other European cities. The very simple site doesn’t list any successes or current start-up clients.
Check them out at: http://www.neroventures.com/
This investment firm totes the words of Greek orator Demosthenes with “The Small Opportunities are the Start of Great Businesses” on the homepage. Now, according to their website, they are very Pais Vasco focused, even saying they are looking for Euskadi+, and yet we met them at a Reverse Pitch in Barcelona, which means they are also targeting outside the Basque region. MicroWave Ventures is made up of 20 VCs who have also been entrepreneurs before, each focused on offering “smart capital” and mentoring. They are looking for recently built, open-minded software companies that haven’t had any funding outside the three Fs (Friends, Family and Fools.) The website lets you also look at the four companies they have already invested in.
Check them out at: http://www.microwaveventures.com or Almda de Recalde 34, 1ºIzda, 48009 Bilbao
This is a venture capitalist firm focused on early and mid-stage human healthcare, biotech and life sciences companies, with a special focus on pharmaceuticals, diagnostics and medical devices.. And as part of their focused mentoring, they not only provide funding, but they specifically focus on building partnerships between these start-ups and well-established companies. Ysios Capital manages the €69 million Ysios BioFund, with a portfolio target of between ten and 12 companies.
Check them out at: http://www.ysioscapital.com/ 935 17 35 45 or Avinguda Diagonal, 600, 08021 Barcelona
Who else should be on this list of Barcelona-focused investment?
These VC/Angel Investors were all a part of Wayra and Startup Party’s Reverse Pitch Contest, as a part of the 2014 Fall edition of Fest-Up: Barcelona’s Startup Community Festival.
We think Barcelona is hot and we’re sure you do too. What other venture capitalists, angel investors or crowdfunding sites are looking to invest in Spain and especially all that Barcelona’s entrepreneurs have to offer? Comment below and tell us!
Also, don’t forget to check out this Barcinno piece on the alternative crowdfunding at CrowdCube.