Fair game

Entrepreneur, Oct, 1998 by David R. Evanson, Art Beroff

Evidence of the value these fairs offer entrepreneurs in getting their companies funded is offered by Tofano, who trekked several hundred miles from Charlotte to Wilmington to be present for the two-day event. "I've heard that if someone in the investment community hears your company's name three times, that's when they start to take notice and get interested," he says. Accordingly, Tofano says he wasn't necessarily looking to close a deal at the conference but to gain exposure for the company in a forum that was recognized by and would have some sway with investors.

Freschman says gaining entree into Early Stage East or a similar conference can, indeed, offer the prestige that's required to make investors sit up and take notice. "Each company that presents has made it through a careful screening process of professional venture investors. For every company that gets to present, 10 to 15 others are turned away."

Tofano confirms the punch Early Stage East gave his TeleSys Technologies. "Some of the most promising calls I've gotten were from investors who weren't even there but who had the opportunity to review conference materials," he says. He believes the sanction of a recognized organization makes investors pay more attention than they would, say, to an unsolicited business plan received in the mail.

Between travel, display rentals, fees and materials, Tofano says he spent about $3,000 attending Early Stage East. So what did he get?

"From the conference itself, I got seven leads I feel very good about," Tofano says. In addition, he got calls from three investors not in attendance who read the conference materials, liked with they saw and contacted him directly. "In some cases, these leads are superior to the leads the conference generated," he says. And Tofano may dig up even more nuggets of gold if he follows up on the conference attendee list with a letter and a phone call.

PLAYING TO WIN

Having been there and done that, Tofano would urge any entrepreneurs looking for capital to attend a venture capital fair, if you can get in. And once you do get in, take his advice:

1. Look for a good match between the investors and your company. Make sure you're attending a fair where the investors are likely to take an interest in your company, says Tofano. For instance, he says, if you own a low-tech company and all the investors in the room are high-tech investors, it will likely be a frustrating experience for you.

2. Fight for a good time slot. If your formal presentation is near the end of the day, by the simple mathematics of the situation alone, you can guess there will be fewer investors in attendance, and the ones who are present may be worn out from listening to so much information in one day. As a result, Tofano advises presenting as early as possible.

3. The positioning of your display booth matters. Whether all the companies are placed in one room or disbursed in a labyrinthine hotel conference center, make sure your booth is in a traffic-heavy location. "Numbers are the name of the game," says Tofano. "If your booth is [on the perimeter], you just won't meet as many investors."