Deal Flow Darwinism - Will Investors Survive?
We evolve to survive. The trouble is just surviving isn’t enough — it lacks security, sexiness and the tantalizing taste of a meaty deal. So, we continue to evolve, but now that initial survival instinct has turned into a need for more even to the point of domination.
But sometimes becoming dominant isn’t sufficient. For a long time, investors have been dominant over entrepreneurs and have largely controlled the terms and structure of deals. But now the investment landscape is changing. And you, the dominant species must evolve or eventually be eaten. The temperature is escalating! VC’s and PE’s are showing record profits, second only to the tech boom in the 1980s, while conversely, institutional markets are stagnant — almost anemic. Factor in the new JOBs Act heating up the entrepreneurial-investment market and an economy seeking change and you have an exciting new embryonic Age breaking out! Understandably, you may be quite comfortable with your old-school methods (at least for a while). But make no mistake —- change is coming and you may soon be an extinct dinosaur. Keep in mind, even the T-Rex didn't survive evolution.
So why are we talking about Darwinism and Deal Flow? With the changing environment, your daily diet of deal flow is evolving too — entrepreneurs now have alternatives. The days of plentiful prey will soon be past. Your fund or financial institution’s daily deal flow staple and ability to cherry-pick the sweat deals will start to dry up. And you will get hungry — very hungry. This new virtual world, with its social media phenomenon and smart phone revolution is driving deal flow online. Yes, you can go hire a few more young bucks for your business development team, but where will they go to find the meaty deals? Likely, the same place you are now – online!
What if you had your old-school investment methods mate with a revolutionary deal breeding species? Yes, I’m talking about creating a hybrid — it is called “Deal Flow Darwinism”! What I’m talking about is still the traditional methods of marrying one investor with one entrepreneur for one stage of funding, BUT…with a new twist — you own the deal flow!
Let’s work backwards through this mating dance. Traditionally, investors form a fund, then go out and seek deal flow. What if you owned the deal flow and then added the fund? Remember: He who has all the food survives and eats meat every day! Think about it!
Imagine a Marine Boot Camp-like training program for entrepreneurs with a Shark Tank®-like presentation to investors on the last day. Then, combine this training with a $2 million Match-com®-like state-of-the-art Web platform that links Entrepreneurs and Investors and organizes all due diligence material. Now, add the celebrity selling power of one of the REAL Sharks of Shark Tank® promoting this training worldwide via national media and infomercials and you get first choice at unlimited deal flow — sound interesting?
Visualize getting first dibs at thousands of deals — all neatly sorted and prepared for your review! This new incubator breed is designed to only let the cream rise to the top — a self-selecting mechanism that weeds out the weak. Yes, Darwinism at it best. As Maverick’s partner you’ll see thousands of our deals before any other investor. Maverick Entrepreneurs is looking for the right VC/PE funding partner. We launch next month, so if that describes your group, then please contact me immediately at: EDrake@MaverickEntrepreneurs.com.
Erica Drake, CEO/Chairman, Maverick Entrepreneurs