The Virtual Handshake
Found a great slideshare contributor in David Teten who is the managing partner of VC firm ff Venture Partners and co-author of “The Virtual Handshake: Opening doors and closing deals online”. Looks to be a great source of information and insight on the online trends with respect to VC/PE investing….
… but I digress. David also maintains a blog where there is a great interview he did with PE firm MCM Capital about how private equity firms use social media to build grow their pipeline and source capital. MCM has incorporated Facebook, LinkedIn, an RSS feed, and a weekly blog into its website to a number of ends. They ask themselves 2 questions when creating content; how does it help the firm and how does it improve the likelihood that someone will find them. MCM has also targeted a top 100 rank for select search terms which may sound good, but as empirical evidence shows, not landing on the first page of results on a search is disastrous for your web traffic. My sense is that a goal for any firm should either be top 10 or bust.
The interview presents real data around website traffic and page views – both of which increased however this is not really a good metric for ‘helping the firm’ – but the stat that really jumped out at me was that their deal flow had increased by 150% in 6 months since implementing these strategies. Deal flow is the lifeblood of any good VC/PE firm and leveraging online strategies to widen the funnel for potential deals sounds like
There is a clear link here between building the investment opportunity pipeline and “widening the funnel” of potential customers as is commonly discussed in a marketing course. The interesting difference in this case is that the funnel for a VC/PE firm actually refers to its products (target acquisitions) and not its customers (which in the traditional sense would be the LPs). I wonder if there are other business models that would benefit from a widening funnel on the product side?