Ah, the American Dream. The good news is venture funds believe in it too and invest in it everyday. In 20 years of venture capital and business building involvement I have yet to hear a top venture fund professional say "We like this company because the CEO went to a top school." What I do hear from investment professionals is extraordinary respect for scrappy CEO's who start with nothing and build something of great, enduring value.
VC's all say they "invest in management." Just as all winning horses need a capable jockey (VC's often call a portfolio company's CEO "the jockey"), a great business plan goes no where without skilled management and execution.
So what do VC's look for in their jockeys? VC's favor business builders who are self-assured, honest and performance oriented. They routinely meet stated business goals and understand financial statements. They look for leadership -- not from one individual at the top -- but a top leader who fosters individual leadership and goal attainment throughout the company. Personally, I like to work with business builders with mature good judgment. They ask for help when they need it and willingly implement good ideas even if the idea was not their own.
While attending a top school can help graduates network to sources of capital, your credentials as a business builder are impressive. You have demonstrated that you can start a business, develop new products, find customers, get paid and achieve profitability. You can execute.
If a potential investor asks you about your education, don't apologize for attending community college. Be proud of the accomplishment. You probably saved thousands of dollars in tuition and board.
If you think about it for a minute, I suspect the seeds of your entrepreneurial drive can be found during your early years. I know of one entrepreneur who worked his way through night school as a garage mechanic. Years later, when he approached some white shirt investors to fund an automotive spare parts distribution and software application business, he spoke with enthusiasm about his grease-stained years. He persuaded the VC's that he had the industry knowledge to create a tool that would be accepted in the market place.
Simply stated, all work and education experiences that contribute to your development as an intelligent, effective business leader are of interest to investors. They invest in business builders who take command of their company with confidence.
Added note: Many top venture funds conduct extensive background and credit reports on management before making an investment. If you have misrepresented your background in any way, assume your deal is dead. VC's have to trust their jockeys before writing multi-million dollar checks.
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My $12 million business has been profitable for 3 straight years on a shoestring budget. I've been researching various venture funds in preparation for raising approximately $5 million for a new medical market software product. It seems these fund decision makers all come from top colleges and business schools. I worked my way through a local community college and finished at a small state school. Does the CEO's educational background matter to investors?
