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Re: Raising Capital for Start-Up Jun 11, 2008 6:44 PM
As concerned as you are about finding a reputable organization to work with; they are going to be equally concerned about you and your venture. If you are looking for capital you are going to need an investor-ready business plan that covers the things that funding sources and investors will want to know about your venture. The plan should also include 3 years of financial projections.
Do you have an investor-ready business plan prepared? If not, that should be one of the first things that you take care of.
As for sources of capital for you: Banks are going to need to see your plan and will be looking at your creditworthiness and collateral. Venture capital firms for the most part now limit their investment interest to narrow niches of business; primarily those businesses past the start-up, R&D phase and currently generating revenue that have the capability to reach $100 Million in revenue within six years. Some Venture Capitalists could almost be termed "venture cannibalists" ... so sometimes even if you attract VC funding it could end up being a less than pleasant experience. There are hundreds, if not thousands, of VC firms and Angel Investors and groups out there. Just type in either phrase into Google and you will find plenty of sites to look at. You would want to find the one that seems closest to have interest or a track record of companies similar to yours. You will need to have a very professional business plan when you approach them since for many it will be the first thing they ask for. If its a plan you've put together your self; have an experienced professional look it over before you present to any investor prospects or funding sources. If this is a new experience for you, if possible, you should also speak with an experienced business professional to walk you through your business launch and the best way to approach sources of capital for your business.
Keep in mind that VC's fund only a small percentage of the deals they see. You may want to give some thoughts to looking at alternatives to VC funding. There are other ways out there that often are better for you than venture capital. Angel investors and other private equity sources might be worth exploring but it is tough to get their attention. First impressions are important in getting their attention; your business plan has to clearly show them your capabilities, the viability of the venture and the opportunity it presents.
I hope the above helps; good luck with your business launch.
Dennis Lowery
Adducent, inc.
