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I know what you’re thinking:

"Venture capital? Seriously? I’m still in high school, cramming for finals—why would I even care?"

Here’s the deal—venture capital (VC) isn’t just for seasoned pros with years of experience under their belts. It’s the playground where bold ideas meet big money.

In fact, many of today’s top startups, from Instagram to Snapchat, were founded by young minds with bold ideas and a lot of hustle.

So, if you've got a passion project or game-changing solution, VC might just be the rocket fuel to take your vision to the next level.

This week, we’re diving into how young founders can break into the VC world, what VCs are really looking for, and how to build the momentum to make it happen.

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But FIRST

If you are new, welcome to OCE’s weekly newsletter curated for the ambitious youth…here are some articles you missed from previous weeks:

📈 Do You Have the Guts to Bet Against the Odds? ​Read More →​

🎨 Best tools for building your passion project ​ ​Read More​ →​

📘 Ready for some real talk? ​ ​Read More​ →​

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1. What is venture capital, and how does it work?

Venture capital is a way for startups to raise money, and yes, it’s one of the most talked-about funding options for growing a business. According to Investopedia, venture capitalists invest money into early-stage companies with high growth potential in exchange for equity (ownership) in the company.

Here’s why VCs do it: they’re betting that one of their investments will become the next big thing—think Uber or Airbnb—and deliver massive returns. In fact, VCs typically expect a 10x or higher return on their investment to offset the risk of investing in startups, where many fail.

What makes VC funding unique? Unlike loans, which need to be repaid with interest, VCs take a slice of your company. This means they’re in it with you, sharing both the risks and rewards. As your company grows, so does the value of their share.

Another perk of venture capital is that it often comes with more than just money. Many VCs offer mentorship, industry connections, and resources that can help your startup scale faster.

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2. What do VCs look for in startups?.

Ah, the golden question. Every founder wants to know what makes VCs say, "Yes”. While every investor has their preferences, there are some universal factors they look for in a winning startup.

What They’re Really Hunting For

• Product-Market Fit (PMF): VCs need proof that your product solves a real problem and resonates with your target audience. This is non-negotiable. A startup like Canva nailed PMF early, becoming indispensable for millions of users worldwide with its intuitive design platform.
• A Huge Market Opportunity: The bigger the potential market, the bigger the upside for the VC. They’re looking for startups that can scale fast and dominate. Think of Uber, which transformed the way the world thinks about transportation.
• Traction: Early signs of success matter—a growing user base, revenue, or partnerships. For example, Notion’s steady growth and loyal user community were major signals of traction before it raised massive funding rounds.
• An A+ Team: They’re betting on you as much as the idea. A strong team with domain expertise, adaptability, and execution skills builds confidence. Many VCs will reference Tesla, where Elon Musk's vision and grit were just as important as the product itself.

VCs love to see that others are already buying into your idea. Whether it’s early adopters raving about your product, an impressive advisor on your cap table, or a reputable angel investor joining your round, social proof signals that your startup is worth their time.

Take Clubhouse, which skyrocketed in value largely due to endorsements from high-profile user (Elon Musk) in its early days. In short, momentum matters.

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3. How do I get venture capital funding for my idea?

Once you’ve nailed down your game-changing product with proven demand and built a rockstar team, you're primed for the next step.

Start by crafting a killer pitch deck. This is your visual sales tool and should cover the essentials: what problem your product solves, how big the market is, why your solution is unique, and how you plan to make money. Pro tip: VCs love metrics, so if you’ve got any traction (like early users or revenue), show it off.

Next up, know who to approach. Not all VCs invest in the same industries or stages of business. Find investors who have a history of funding startups like yours—this makes it more likely they’ll be interested. Platforms like AngelList or Crunchbase are great for scouting them out.

But don’t just send cold emails and cross your fingers. Networking is key in the VC world. Leverage your school networks, LinkedIn, startup events, or even Twitter to make connections. Warm introductions—where someone you know connects you with an investor—are far more effective than cold pitches. One of the smartest strategies? Get a portfolio company of the VC to make the introduction for you.

And finally, be prepared for rejection. Seriously, even the biggest success stories (like Airbnb) were turned down dozens of times before landing their first check. Stay persistent—it only takes one “yes” to kickstart your funding journey.

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4. What VCs expect after investment?

Once VCs invest in your startup, they want to see you work hard to make the business grow and eventually sell it or take it public so they can make their money back (and more!).

Here’s what VCs expect from you:

• Exit strategy: They want to know how and when they'll get their money back. This could happen if your startup gets bought by a bigger company or goes public through an IPO. Most of the time, VCs will push for an acquisition so they can get their investment back along with a profit as quickly as possible.

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• Ownership: VCs typically receive preferred stock, which gives them special rights, like getting paid before you (the founder) if the company is sold, while founders usually hold common stock. This means as you raise more money, your ownership stake might shrink, which can impact your control over the company. In some cases, if the VCs believe the company isn't on track or if they want a different direction, they may even push to fire the founder to ensure the company’s growth.

• Decision-making: VCs will want to have a say in big decisions, like who to hire or when to expand. They want to make sure you’re making choices that help the company grow fast. This means most of the money goes straight into growing the business, not your wallet—you’ll likely be living on just enough to get by. Plus, you’ll need to provide regular updates to keep your investors in the loop on how things are going. They expect you to be transparent and keep them in the loop.

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• Growth: VCs want to see results fast. They want to see your startup scale very quickly, building a strong customer base, and eventually selling it for a profit. This means you might feel pressure to grow your startup quicker than you might have planned.

So, getting VC funding can help your startup grow quickly, but it also means working hard to meet their expectations and delivering a profitable exit - for many founders, that trade-off is worth it.

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Like what you read? Share with friends!

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PS. This summer, we are going to tackle pressing global issues and drive innovation in regions (such as your own community) where it is needed the most. Want in? We run a summer cohort for ambitious youth (high school and undergrads) to work directly with world-class founders while learning from Silicon Valley leaders. ​ OCE Summer Cohort ​ You can also explore purposeful opportunities through our Impact Internship Opportunities Database. ​ Get Curious.

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Lena

​https://www.openclassroomexperience.com/​