Bevans Branham takes a look at American-based venture capitalists and why they are afraid to invest in companies based in other countries. What can be done to help prevent U.S. investors from missing the boat on potentially great opportunities?

1. Want
to
invest?
Why
not
consider
global
markets.
An
ar8cle
by
Bevans
Branham

2. Every
year,
venture
capitalists
are
asked
about
their
thoughts
regarding
inves8ng
outside
of
their
home
country.
It
seems
to
make
sense
that
these
types
of
investments
would
be
very
lucra8ve,
countries
outside
of
America
account
for
86%
of
the
users
of
top
internet
sites
like
Facebook,
TwiFer,
LinkedIn,
etc.
Shouldn’t
venture
capitalists
be
tapping
into
this
market
as
well?

3. Well,
it
turns
out
that
many
of
these
investors
who
spend
so
much
8me
and
money
in
their
home
country
(usually
Silicone
Valley
area)
are
very
averse
to
inves8ng
in
companies
outside
of
the
United
States.
What
are
some
of
the
reasons
that
this
is
happening,
and
what
can
we
do
about
it
to
ensure
that
we
don’t
miss
the
next
big
tech
wave?

4. Home
Bias
It
shouldn’t
be
a
huge
surprise
to
anyone
when
I
say
that
venture
capitalists
usually
have
a
hometown
bias.
If
you
grew
up,
went
to
school,
started
your
first
company,
and
currently
reside
in
an
area
like
Silicone
Valley
or
New
York
City
it’s
very
likely
that
you’re
going
to
think
that
companies
and
talent
from
that
par8cular
area
is
top-­‐notch.
This
type
of
bias
happens
all
the
8me
(and
not
just
with
VC’s),
so
it’s
no
surprise
that
when
it
comes
to
spending
money,
VC’s
are
a
liFle
nepo8s8c.

5. Physical
Proximity
If
you’re
inves8ng
in
an
early-­‐stage
startup
it’s
very
likely
that
you’re
going
to
want
to
be
involved
in
many
of
the
decisions
that
this
company
is
going
to
be
making.
If
it
requires
a
10
hour
flight
for
you
to
get
to
a
board
mee8ng,
this
could
be
a
major
barrier
to
you
being
as
effec8ve
with
this
company
as
opposed
to
one
which
is
located
in
your
hometown.
Because
of
this,
many
VC’s
don’t
want
to
invest
in
poten8ally-­‐good
companies
not
located
near
them
because
they
feel
as
though
they
won’t
be
able
to
help
out
as
much
as
they’d
like
to.

6. Though
there
are
these
obstacles,
this
shouldn’t
deter
everyone
from
inves8ng
abroad.
In
fact,
entrepreneurs
all
over
say
that
Silicon
Valley
knowledge
and
exper8se
in
places
like
China,
Japan,
Africa,
and
Mexico
is
in
very
high
demand.

7. If
an
investment
company
were
able
to
secure
loca8ons
in
these
areas
it’s
very
likely
that
they
would
be
a
hit
among
the
entrepreneurs
of
the
area.
Along
with
that,
they
would
have
the
unique
ability
to
invest
in
companies
that
Silicon
Valley
based
investment
firms
would
be
too
afraid
to
invest
in.
Hopefully
these
barriers
will
be
eliminated
in
the
near
future
so
we
don’t
miss
the
boat
on
the
big
companies
of
the
next
10
years.

8. Originally
posted
on:
Bevans
Branham's
Blog