Raising capital is no easy matter. Facilitate your progress with venture capitalism by learning and abiding by expert advice.
Know the Numbers
Any venture capitalist you meet is going to want absolute validation; be prepared with a detailed analysis of the numbers and how you see them impacted by the infusion of capital. Knowing your business well will impress upon the VC that you are involved personally and will take care of their money. Be able to quote figures and to summarize business process plans and project management predictions. Show that your company is capable by representing your team, record and talents with verifiable facts and figures. Show a promise of progress.
Time it Right
Most VCs will develop an interest in your business once you have proven that there is a place for it in the world. Show increasing demand with sales reports and forecasts. Clearly demonstrate that your business is on the move in an upward direction. Venture capitalists want to see cause and effect: prove to them that their money will instigate positive results.
Hurry Up and Wait
Securing capital can consume a lot of time and energy. It is unlikely that the first proposal your company makes will be accepted, therefore, it is crucial that you are prepared to wait it out. Keep immaculate records of all meetings, including dates and responses and follow-up accordingly. You may be pressed to prepare for a scheduled VC presentation by a deadline yet not receive any response for a painstakingly long period of time.
Who You Know is Vital
Venture capitalists may be in the business of lending money, however; they probably do it sparingly. Once way to maintain your edge is by networking in the right circles. A VC is far more likely to spend time with you if you are recommended by someone they already have faith in. If you are introduced by someone they trust, your efforts to impress them will be met with more optimism and your chances of success increased considerably.
Get To the Point
We all know time is money and this is even truer for the venture capitalist. Practice your presentation and make it as concise and succinct as humanly possible. Your initial encounter will probably be limited to 60 minutes: make every one of them count.
Have your pitch prepared for a moment’s notice by keeping it fortified with all relevant operational statistics, legalities and other information. Make sure it is accessible in print and online so that you can instantly share it with a potential investor. Opportunity often shows up without an appointment; don’t risk losing a VC’s interest or your forward momentum by having to put something together in haste.
Cover the Legal Bases
VC terms can be intricate, confusing and subject to rapid-fire change; you have too much at stake to risk being unprepared legally. Hire a trusted attorney and keep him at the ready. Venture capitalist spend most of their time in negotiations, whereas the average entrepreneur does it only a few times. You need strong legal representation and an experienced voice navigating the terms of the investment and preparing your future.
Use this proven advice to propel your company’s progress and secure the capital it needs.