How should I choose a venture capital investor?

Management should carefully assess the value-add of potential investors, seeking VCs who have been in the business a long time, have a proven track record of solid successes and a network that will serve a company well throughout its growth. Additionally, management should look for partners with relevant experiences and relationships, who share a similar operating philosophy and understand the market in which the company operates.

Further, it is important to Mayfield that a company chooses a set of investors who can add value as a company requires in its different stages of growth. We look for co-investors with a similar philosophy, track record, network of appropriate contacts and commitment to the long-term success of the venture.

In which types of companies does Mayfield invest?

Mayfield invests primarily in early-stage technology companies with the potential to lead in the enterprise software, consumer services and communications sectors. We do not invest in publicly traded companies nor do we invest in any companies that are not technology-based.

Does Mayfield invest outside of California?

Yes. However, outside of Silicon Valley, we prefer to work with local co-investors. Additionally, although most of our investments to date have been in the U.S., we look at selective investment opportunities in other countries.

How much does Mayfield typically invest in a company?

Although the amount we invest is driven largely by the opportunity, our typical initial investment is $1-3 million. We generally also participate in follow-on financing rounds and assist in finding co-investors in these rounds.

Does a Mayfield partner always join a company's Board of Directors when Mayfield makes an investment?

In most cases, yes. In our experience, active participation on a company's board helps us to maximize our contribution to the company's long-term growth.

Does Mayfield prefer to lead a round of venture capital investment?

Yes. By leading the round, Mayfield plays a major role in setting the terms of the investment, the amount of money invested and also helps select other investors to join in the funding. We feel that by leading a round or by being part of the lead group, we can add the most value and have the most impact.

Will Mayfield invest in a company even if it is not the lead or co-lead investor?

Yes.

Who are Mayfield's investors?

Our limited partners (LPs) are prominent institutional and individual investors who represent a broad cross-section of universities, large corporations and influential business leaders.

What information does Mayfield find most helpful in evaluating potential investments?

For initial consideration of a potential investment, we prefer to receive a 2-3 page Executive Summary that addresses the following areas:

• Brief description of the product or service.
• Market need, size and competitive landscape.
• Company/product positioning.
• Customer and customer acquisition strategy.
• Background of key management.
• Development stage of company including milestones met and set.
• 3-year financial projections summary.
• Capital requirements and current capitalization structure.

What are the key decision criteria Mayfield uses to determine whether to invest?

We invest in technology companies with the following attributes:

• Strong customer value proposition, large market opportunities and a solid go-to-market strategy.
• Great technology.
• Sustainable competitive advantages through highly differentiated, superior products or services positioned to dominate emerging markets.
• Exceptional entrepreneurs with a clear vision of the business, a passion for the technology and its long-term potential, the energy to build an enduring enterprise and the ability to execute.

What is the investment process at Mayfield?

We receive more than 3,000 business plans a year, therefore the key to getting a plan accepted by Mayfield is to have a sponsor within our partnership. You can get a sponsor by leveraging your connections at a university such as Stanford University that knows Mayfield, contacting an attorney, investment banker, entrepreneur or accountant who is familiar with our process. Once sponsored, the partnership does due diligence on your markets, customers and prospects, you present your business plan, term sheets are agreed on and financing and a long-term working relationship begins.

After making an investment, what does Mayfield do to support the growth of its companies?

Mayfield has a team approach towards our portfolio companies. Our Managing Directors are active on our portfolio companies' Boards of Directors. We also employ specialists in Executive Recruiting and Marketing who are available to assist our companies in those areas. Additionally, our Impact program fosters networking opportunities among our portfolio companies with invitation-only CEO Summits, peer-to-peer dinners and roundtables, and other Mayfield-sponsored activities.

How can I submit a business plan to Mayfield?

Contacting Mayfield through one of the partners is the best way. We also leverage our contacts with attorneys, investment bankers and serial entrepreneurs. Although we prefer to get business plans by e-mail, we do also accept business plan submissions by fax or surface mail. See contact information.

What is a Portfolio Company?

Portfolio Company is an industry term that refers to companies in which venture capitalists invest. Such companies are said to be held "in the portfolio" of the venture capital fund.

What is a Managing Director of a venture capital fund? Venture Partner?

An individual who assumes responsibility for managing a venture capital fund and selecting companies in which to invest is called a Managing Director.

Venture Partners work with portfolio company management, but do not have responsibility for the general management of the fund. Typically, they have a minimum of 10 years industry experience in engineering, sales, general management or marketing. Their experience complements rather than overlaps that of Mayfield's Managing Directors.