Finding Venture Capital for a Startup Business
Be Prepared
Venture capitalists are entrepreneurs. They’re willing to take reasonable risks for a business, but before they do that, they need to see that you’re completely devoted to the success of the project. Professionalism is a requirement with them, not an option. You need to prove to them that you’re taking the project seriously and to do that, you’ll need to put your convictions in writing with a business plan.
Venture capitalists are not generally as soft-hearted as angel investors. They won’t like it if you waste their time. Never submit to them a less than stellar copy of your business plan. It must be polished to the hilt, clearly and concisely written, and it must be convincing at all costs.
Make sure your presentation is just as polished. You should have your presentation ready at least one month before your appointment with a venture capitalist. Invite friends and colleagues, hopefully those who are qualified to give you constructive criticism, to listen to your presentation so that you’ll get used to making the presentation. Encourage them to ask questions and take note of how you answer them. The same questions could come up later on from your future business partners.
Be Confident
Venture capitalists are more likely to listen to and be impressed with what you have to say if you act and speak confidently. You are not proposing your business for no reason, are you? You believe in it, don’t you? If so, speak and act like it.
Be prepared for their questions. They aren’t just going to take your words at face value and hand over millions of dollars without asking anything. They’re going to fire one tough question after another and you have to be prepared for it.
Be Fair
No venture capitalist would risk their money for your business if you’re not prepared to offer reasonable terms and conditions for your proposed partnership. True enough, you’ll be doing most of the work but they’ll also be putting up most of the money. Venture capitalists will find your proposal more attractive if you acknowledge the value of their contribution.
Ask Around
If you’ve got all the documents ready then it’s time to start looking for potential venture capitalists! Unfortunately, they’re not something that you can look up in an online or telephone directory so you’ll have to do it the old-fashioned way and ask around.
When asking for possible venture capitalists to contact, make sure you’re discreet and you don’t come off as arrogant or desperate. Use your network to scour them out but don’t let everything out in the bag; just give a hint here and there about what you intend to propose and venture capitalists will come sniffing sooner or later.
Be Sure
Now, if you and your future business partner have come to terms, make sure that you read the resulting contract several times before signing anything. Better yet, have your lawyer double check the fine print. This isn’t a matter of trust but simply a wise precaution any sensible businessman would take. If nothing’s amiss then congratulations! You’ve got venture capital for your business.
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