Venture Capital Do’s and Don’ts
- Base the projections on realistic assumptions.
- Be concise, but complete.
- Be positive and enthusiastic about your company and product/service.
- Clearly explain the opportunity.
- Document how the products are different and better than what is available.
- Keep trying.
- Know your minimum deal and be prepared to walk away, if necessary.
- Let experienced business people read and critique your plan, testing it for clarity and reasonableness.
- Make a full disclosure of the possible pitfalls as well as the strengths.
- Proofread carefully to make certain there are no errors in grammar or math.
- Put together a strong management team.
- Remember this is a long term relationship.
- Research the investment criteria of the venture capitalists to ensure that what you offer is what they are looking for.
- Take time to study and understand competitors, addressing their strengths and weaknesses.
- Widen your network of contacts to give you more avenues of approach.
- Avoid answering questions.
- Focus on the technology (leaving out mention of the market, the competition, the customers)
- Give up.
- Have any typos, errors, repetition, junky charts.
- Make exaggerated claims about the product or the management.
- Predict you will capture “2% of a billion-dollar market…”
- Press for immediate decisions.
- Send the first draft of your business plan to the venture capitalists.
- Use four significant digits anywhere.