Venture capital has been instrumental in fueling the growth of America’s high-tech industries. Some of the America’s most visible companies – Cisco, Intel, Microsoft, Apple and Sun Microsystems – owe their success to venture funding. Competition for venture capital is fierce. For example, Kleiner Perkins Caufield & Byers (KPCB), the legendary Silicon valley venture capital firm, specializing in high-tech startups, receives and reads 2,500 business plans per year, meets with 100 teams in a year and invests in about 25. The following sections provide practical advice to increase the odds of acquiring venture capital for high-tech startups.

• Use A Reference To Contact The Venture Capital Firm - Unsolicited business plans become a statistic. Venture capitalists prefer business plans that have been referred to the firm by someone- a CEO, an engineer, a lawyer, friend, or another venture capitalist- known to both the founders and the firm.

• Strong Teams are more important than Product and Technology - Venture capital firms look for companies with strong teams. In today’s market, there is an abundance of technology, entrepreneurs and venture capital. What's lacking is great teams. The rational for strong teams is simple. Technology is inherently risky and strong teams are in a better position to adapt to adversity.

• Proprietary Products - Venture capitalists prefer companies with proprietary products. Such companies enjoy a desirable "unfair" competitive advantage by virtue of the exclusivity of their products. Sometimes, a non-proprietary product with an exceptional head start on potential competition can fit these criteria, as well.

• View Venture Capitalists as Friends not Foes - In high-tech companies, most of the venture capital firms prefer to take the role of sole or lead investor, insisting on board representation and close ongoing contact with operating management. Companies should not get emotional on the subject of ownership and control. The important point is that relationship between the venture capitalists and the management of the company financed is a partnership in which both partners have the same goal; namely, the successful growth of the business. For example, KPCB has setup a Keiretsu, which consists of all the companies they have financed. The companies in the KPCB Keiretsu consistently share experiences, insights, knowledge and information.

• What Problem is The Product Solving? - This is the initial question asked by the venture capitalist, and this is where majority of the business plans are rejected. Why? Technology-driven business development, in which technology is in search of an application, presents difficult problems. Introducing new technology and simultaneously creating a new market is often referred to as double-whammy investing. The high fatality rate of projects with these characteristics is well known to venture capitalists.

VentureOne at http://www.v1.com - It is an investment research firm helping facilitate communication between high tech startups and leading members of the
venture capital community. The web site has excellent reports that provide detailed analyses on venture capital investing, paying particular attention to investments made by industry, round type, development stage and geography. In addition, an industry overview section on technology helps the companies evaluate the valuation information within the context of the broader venture capital market. Finally, the archive of articles on venture capital from various media publications is a treasure.

Accel Partners at http://www.accel.com/entrepreneurs - Based in Palo Alto, California, it is one of premier high tech venture capital firms focused exclusively in three sectors: Communications, Internet and Intranet Software and Services in Technology and Health Care. Its web site has articles and speeches that offer insightful advice on obtaining venture capital. In addition, the web site has links to some other sources of relevant information such as: DaVinci's Inventor Homepage, Private Equity Links, MIT Entrepreneurs Club, and The Indus Entrepreneurs.

Kleiner Perkins Caufield & Byers (KPCB) at http://www.kpcb.com/keiretsu/index.html - Based in Menlo Park, Calif., it is one of the best-known venture capital investors in high technology. Its web site is an excellent resource for KPCB Keiretsu. This is a networking resource, comprised of more than 175 companies and thousands of executives, is an invaluable tool to entrepreneurs in both emerging and developing companies. KPCB organizes its investment strategy around eight initiatives: The Net, Enterprise Software, Consumer Media, Communication, Semiconductors, Medical Devices and Diagnostics, Drug Discovery and Therapeutics Healthcare Services & Informatics.

Red Herring at http://www.herring.com/events/venturemarket.html - Is a monthly magazine covering the business of technology. Its web site has a separate section for venture capital that has information about the previous and forthcoming Venture Market Series. In these series, Red Herring selects CEOs of the hottest private technology companies to present their business plans to key members of the investment community. These exclusive, regionally focused financial forums include participation from leading venture capitalists, top world financiers, business development executives and members of the technology and finance press.

TechCapital at http://www.techcapital.com - This web site offers insightful information about entrepreneurship, high tech business and financiers in the Mid-Atlantic and other high-tech spots up and down the East Coast region. In addition, the web site has a detailed list of venture capital firms focussing on high-tech in the Mid-Atlantic region.