How Venture Capital Firms Can Simplify their Decision-Making Processes with Quality Data
SARAH CHEESEMAN, 09 June 2023
Learning how to find eligible companies to invest in takes time. A huge amount of knowledge, experience and insight goes into the process—not forgetting personality and preference. While some Venture Capital firms (VCs) will prefer to work within a particular industry, others will look more broadly, potentially seeking bigger risks for greater returns.
But whichever industries and businesses you go with, the fact remains: knowing how to make the right investment decisions is the key driver of success in this field. So, how can you do this reliably with as little financial risk as possible? The answer is all in the data.
How can data help with investment decisions?
Without wanting to sound too cliche, when it comes to investments, knowledge is power. The more you can find out about a company, the more you can quantify how effective your investment in them could be, and the less you need to rely on estimations and guesswork.
That’s why quality data is priceless for venture capital firms. It enables them to not only identify new and exciting businesses to invest in, but also to structure deals and manage existing portfolios.
Some of the most pivotal areas that you may want to look into include:
Team and company background
Company and industry comparisons
Data can be incredibly helpful when it comes to understanding similarities and differences between different companies, opportunities and deals. While you may have had successes with one company within a particular industry, this doesn’t mean it will be the same for all of them.
As every potential deal opportunity starts with due diligence, having up-to-date data is essential. Some interesting areas that you may wish to analyse during your due diligence process may include:
Being smart with your data
How Beauhurst can help
As you may be able to imagine, collating and analysing all of this data is a huge task. While many VCs choose to compile their own databases of company information, at Beauhurst we’ve gone a few steps further.
Our BeauhurstInvest platform brings together data on over 5m UK companies in one searchable format. Our clients can filter, segment and search over this information, revealing fundraisings (announced and unannounced), MBOs, grants, spinoffs and even tech stacks. You can also set up alerts, meaning that if there’s a change in a company you’ve got your eye on, then you’ll be notified. So you’ll always be on top of what’s happening within your portfolio. Thanks to our 60+ data experts and machine learning models, this data is constantly being updated. You can find out more about how VCs use the BeauhurstInvest platform to find and vet potential investment opportunities here.
Uncover top investment opportunities.
Get access to unrivalled data on all the companies you need to know about, so you can approach the right leads, at the right time.
Book a demo today to see all of the key features of the Beauhurst platform, as well as the depth and breadth of data available.
An associate will work with you to build a sophisticated search, returning a dynamic list of organisations that match your ideal customer profile.