What’s the Scoop on Venture Capital These Days?

Providing an investor is going to get what he or she feels is a great Rate of Return on Investment (ROI), then an entrepreneur might have a shot at a venture capital (VC) deal.

There are deals to be achieved although the 2010 results show that the VC market tends to run below the prerecession levels.  Three aspects are increasingly important with the first being the expected ROI balanced against risk factors.

Another important aspect VC investors site is the exit strategy.  Private company trends show that IPOs are not the only strategy and in some industries or in the case of government-backed deals, entrepreneurs are looking to alternatives to the standard Wall Street exit.

A third reason to encourage VC investment may be the sector.  The right sector at the right time can make a difference.  Here are some popular 2010 sectors to look forward to 2011 VC.

1. Internet – The newest ventures are going to be technology crossover ventures.  What is that?  Combinations of technologies and software, social media sites combining digital games and other media, emailing and sales software and technologies, medical and engineering prototype software.

2.  Software Development – VCs crave software deals, mobile applications, electrical grids, analytical software…its all good fodder for investment.

3. Energy, Green and Ecosystem Deals – Since the economy tanked and taxes are sky high, how can consumers save money on utilities while promoting a healthy world.

4. Electronics – Who can resist the latest greatest gadget or great TV?  This is where Apple (like the iPad) is a great example.

5. Medicine and Drugs – Basically, we are all getting older and new generations want to be healthier and live longer.

With your pitch to a VC investor make sure you business plan is iron clad detailed!