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The VCIR Winter Company Selection Process
This post was authored by Tim Connor of Sequel Ventures, co-Chair of the VCIR Selection Committee
We’ve received a lot of inquiries recently on "how are companies selected for VCIR?". Mike Bearup and I have run the selection committee over the last three years so I thought I’d try to provide a little insight.
Starting from the beginning - we get started each year in October and reach out to the entrepreneurial, venture and professional communities throughout the Rocky Mountain region to encourage companies seeking venture funding to apply to present at the conference. We try to make this a very inclusive and democratic process - the more plans to consider the better. By November, we have begun to receive a good quantity of plans and begin the evaluation process. We assemble a team of roughly 20 evaluators (venture investors, lawyers, bankers and accountants from around the region - CO, UT, NM, AZ, WY, ID, NV, MT) - split into two teams - to review every plan and rate them on a scale of 1 (good) to 4 (bad). This year we had over 100 companies apply to present for only 24 presentation slots.
The committee evaluates each plan using several filters:
1. Most important - "how interesting of an investment opportunity will this be for venture investors". Emphasis is on venture investors. Our primary audience at VCIR is venture firms from around the country. There are several other great conferences that focus on angel opportunities. Within this filter, we try to select companies from a range of stages - from seed to late stage - and from a range of industries - IT, communications, web, clean tech, consumer. The only industry we excluded this year was health care. Finally, we try to make sure that the companies selected reflect the geographic makeup of the Rocky Mountain Region.
2. Will the company be seeking capital within the next 12 months? Investors come to the conference seeking short term funding opportunities. If funding needs are more then a year out, a company should wait and make their pitch to investors next year.
3. This year we were seeking to have a concentration of companies from two sectors which are well represented in the region - clean technology/alternative energy and next generation web based businesses.
Once the plans have been rated, we hold conference calls among the selection committee members to discuss the merits of plans that are highly rated or on the bubble. We want to make sure that a decision is not made just on an aggregate quantitative rating, but also that the companies and ratings survive the rigor of committee debate. We have one rule around these debates - what is said in the discussion is not repeated outside the call. It is very important to the process that these discussions are candid and through and folks aren’t concerned that their opinions are repeated outside the group.
The final selections from the committee process are given a final sanity check by Mike, Seth (as VCIR chair) and me and invitations are extended. We typically have one or two companies receive funding commitments between selection and the conference, so we make sure to have a company or two "on deck" to fill those slots. Every company is required to do a dry run of their presentation in front of a collection of selection committee members prior to the conference.
Hope this is helpful. We try to improve the process each year so we welcome suggestions on how to improve the application and evaluation process.
