This BLOG is pretty new and as of now I've not talked about this part of my history or background but in my past I did quit a pretty good job to build a startup. I was able to raise some venture capital, operate the business to profitability and then sell it to a larger corporation. Having said that, recently I've been approached by a number of people asking for advise on their business plans, business models and funding proposals. I'm not sure what suddenly sparked this flurry of activity but hey, it's all good. I'm always happy to help when and if I can.
The following is a cut and paste from an email that I wrote to one individual that was seeking some advice. If it can help anyone out there, great.
Most businesses need angel financing, venture capital, or bank financing to some degree to get started. To accomplish this, many entrepreneurs create elaborate funding proposals, pitch decks and business plans as a means of attracting financing, however few actually take the time to have their documentation analyzed and reviewed by professionals BEFORE they submit to potential investors.
If you are like most entrepreneurs, you don’t have access to an unlimited amount of potential investors, so getting it right the first time is very important. Ask yourself the following questions:
1. Do you understand the typical processes used by investors to evaluate potential investment opportunities and business models? Is your submission in line with these processes?
2. Do you understand the process through which funding decisions are made?
3. What due diligence will investors conduct on you and your business?
4. Do you understand the financial analyses that will be performed on your submission?
5. Are you clear on the role that risk plays in the evaluation process?
These are just a few basic questions. If you can’t confidently answer yes to each of them, I strongly recommend that you find someone that can assist you with the process before you begin engaging potential investors. Depending on you specific business or situation, SCORE can be a great resource if you need to find mentors and advisers. Check them out at https://www.score.org/