Are you running a venture capital firm, in a venture capital capacity? Do you need access to a consistently up-to-date venture capital database so that you can perform your due diligence as a venture capital banker? There are several ways to get such a database, but not all of them are ideal for your purposes. A good database should have the following key features: user friendly interface, multiple levels of access (so that the less knowledgeable investor doesn’t have to climb the corporate ladders to the VCs), and easily searchable links to the most up to date financial filings, regulatory filings, and other important documents. It should also have an easy to navigate dashboard that lets you drill down into various areas.
In addition to providing an easy to use interface for doing your due diligence as a venture capital banker, you will want to have access to your database’s technical data fields. Many such databases specialize in tracking private equity capital funding. And some even display recent deals and transactions of private equity capital. These venture capital directories or email lists acquired from reputable sources are often regularly updated and regularly monitored.
The first thing you want to do when searching for a great venture capital database is to find one that is well-designed, clearly presented, and searchable by category, fund size, individual deal size, individual company name, and industry. You also want to be able to drill down in any way desired from these wide data fields. This ability to drill down is especially useful if you are trying to learn more about individual companies that you don’t know much about. For example, if you are evaluating two companies with similar business models, each of which could be backed by a similar venture capital firm, being able to drill down in each company’s venture capital database and look at the details of its past financing deals, is a great way to make informed decisions. If you only have limited experience with these kinds of companies, having a great database that allows you to easily navigate within it is invaluable.
As another feature of a good venture capital database, you want to be able to search for startups in various industries. Obviously, if you want to invest in startups in a particular industry, you may want to focus on that industry. However, there are plenty of other ways to identify promising startups that may not yet have a proven record of success. For instance, if you are interested in late stage “Unicorn” startups, you can probably find them based on their revenue figures.
Another key feature that your venture capital database should have is the ability to flexible filter and group investments according to several different valuation metrics. Some of the most common valuation metrics in use today are the revenue and profit multiples of a business’s latest product or service release, market cap, price to earnings (PE), price to sales (PS) and price to book ratio (PB). Many startup investors are leery of using these metrics, but remember, they are used by financial institutions and giant companies like Wal-Mart to make buying decisions. In essence, they are objective, data driven, statistics-driven measures. The VC database should allow you to filter investments based on the criteria you want to apply.
Finally, as with any business-building venture, you should use a great venture capital database with the right tools to get the job done. You should be able to sort through investment data from a variety of sources, drill down in real time to specific industries and currencies and be able to use flexible filters and analytical functions. By taking advantage of these features, you can build a great venture capital database for your investing needs.