Village Ventures

Abstract

Edward Lassiter, CEO of a fledgling technology start-up that is 12 weeks away from exhausting its initial $500,000 angel fund, is mulling offers from three venture capital firms. Two of the firms are traditional venture capital funds, while the third one, Tall Oaks Capital, is tied to a national venture capital organization called Village Ventures. Intrigued by the unusual relationship between Tall Oaks and Village Ventures, Lassiter wonders whether the two organizations, in tandem, would be able to offer his company more in the way of logistical support and expertise, in addition to their financial investment, than would the two conventional firms. Lassiter ponders the three firms' term sheets, knowing that he must make a decision in the next two days. Excerpt UVA-F-1342 VILLAGE VENTURES Village Ventures is fueling innovation in areas with high densities of intellectual capital that up to now have been ignored by the capital markets. We are building the world's largest network of locally focused early-stage funds to transform how and where technology companies are created and grown. —Matt Harris, CEO of Village Ventures Edward Lassiter, CEO of ClearVoice Software, relaxed in his Charlottesville, Virginia, office at the end of another grueling business day. For the past two months, it seemed that he had spent every waking hour trying to secure $ 3 million in growth capital for his fledgling voice-recognition software company. The $ 500,000 in angel financing that he had brought in six months ago was disappearing fast, and he needed more capital to keep ClearVoice growing ahead of its rivals. Fortunately, Lassiter's hard work on the fundraising trail had paid off with term sheets from three different venture capital funds. All that remained was for him to decide which offer to accept. He was fully aware that the success or failure of his company could well depend on his choice and was determined to make the correct decision. . . .