With so much “stuff” on the web about raising venture capital, I want to pass on this very good list of 7 tips for raising venture capital that I caught this morning when it was re-posted on Small Business Trends. The author, Prasad Thammineni, says he raised venture capital money last year, and it shows. I raised venture capital for my company about 10 years ago, and everything he says here rings true from my experience.

Just as a reminder, venture capital means money managed by professional investors. Some newbie entrepreneurs use that term to refer to any outside investment, but VC money is rare, reserved for only a few thousand startups per year, the cream of the crop.

I try to stay on top of this out of personal interest, experience and keeping up on trends for this blog. It’s been awhile since I’ve seen as realistic and practical a list as this one.

My personal favorites, of the seven, are the last two. And I think you should click either of the links above in my first paragraph to read the whole thing. But here are the headlines of all seven, with details from the last two:

1. Understanding your business is key.

2. Know when to raise capital.

3. Prepare for a long slog.

4. Approach VCs the right way. 

5. Practice your pitch.

6. Have due diligence materials ready.

We put together projections, operational stats and related legal files (as recommended by our lawyer) in one place online so that we could share the information with interested investors right away. We worked hard to keep momentum going when investors showed interest.

7. Hire a good lawyer.

Venture terms are constantly changing. VCs negotiate investment terms constantly; most entrepreneurs do so only once or twice in their careers. Without the help of an experienced venture lawyer, I don’t know how we would have gotten such a good deal.

Raising venture capital is a difficult process, but it can really help grow a business. Preparation is key to succeeding at the venture capital game!

Nice work.

Tim BerryTim Berry

Tim Berry is the founder and chairman of Palo Alto Software and Bplans.com. Follow him on Twitter @Timberry.