You probably know all of this already, but here are some refresher tips on how to secure funding for your business:
- Polish your business plan. Re-read the executive summary, management team, competitive edge, and financials. If you’re operating in Internet space in the present market, make sure you are generating traffic and focusing on marketing much more than profits.
- Develop your pitch. Pitches are critical to the Venture Capital process. You don’t send business plans to VCs until they’ve asked for them. Instead, you send pitches to establish interest. Many VCs prefer emails with a pitch deck attached (just a few short paragraphs) to in-depth written summaries, so you need to prepare both: a compelling pitch deck to communicate with investors, and a brief but exciting email, one page at most, outlining the growth prospects, type of business, and potential investor payoff.
- Select VCs carefully. Don’t shop your plan. Instead, research your VCs carefully, looking for deal size, industry, and geographic preferences that match your plan.
- Approach selected VCs correctly. For the VCs whose criteria match your plan, find out how they want you to communicate with them. Know whether they prefer email summaries, summary documents, pitch decks, phone calls, or whatever. This is a matter of millions of dollars, so do it right.
- Make sure you have a good relationship with an experienced attorney. You definitely need the right legal help to make a real deal. Make sure your attorney has been through similar deals; if not, then they should recommend a specialist instead. Investment deals are serious business.
- If you don’t find anything, what’s next?
- The U.S. National Venture Capital Association has an easy-to-use listing of hundreds of VC firms, including web links.
- U.S. Western Association of Venture Capitalists. More than 100 of the better-known mainstream VCs.
- America’s business funding directory. Fill in your profile, and if your plan is interesting, lenders and investors will contact you. Free to the entrepreneurs.
- British Venture Capitalist Association.
- Canadian Venture Capitalist Association.
- Google listing of venture capital firms.