Business is our
development if not taken, develops into non-production expansion of a stalemate
of idea's and research comes then to a non-existent.
services, research, and standing out side of a day-to-day operation we look
at thinks different.
services and research is complete with out looking at solutions that can increase
productive and bring the cost and assembling time down.
a pleasant presentation to the product that gives more profit without capital
cost blow out.
required by the public to bring to them the latest technology at the present
of development and thinking.
the high quality of the company presentation that has been built over the
Key Steeps to get Going
Time after time we run across businesses who just have not done their homework
before presenting their case to potential investors. Here are twelve things
that need to be address special in developing.
The investor wants to see a complete team, functioning in each critical
area, with sufficient experience to indicate competence. Ideally the team
has worked together before, hopefully succeeding, though failure is not
absolute cause for injection. They must display integrity and
exhibit "fire in the belly" commonly know as drive. The most common
failing is lack of quality CEO. Many entrepreneurs think that coming up
with an idea for a product or service is qualification for being CEO, but
investors don't see any correlation between the two.
Investors consider whether the team is focusing on a single project or a
number of projects. I once visited a company that had six separate and unrelated
projects taking place. The focus in management team was so diffused that
we felt it virtually impossible to ever bring anything to fruition. On the
other hand, investors may feel uncomfortable with a one project company
if that product result shows no sign of lending to s subsequent generation
of other products.
3.) Practical Technology or Product
The company must demonstrate the practicality of turning its technology
into product that is need by people who will recognises the need and pay
to have it satisfied. We're looking for some middle ground here. The technology
should enjoy some degree of protection from copying by competitors. Is it
a need or a want ? A need is only to satisfied your self. A want is a requirement
for people to buy.
4.) Market Analysis
Ideally, the market is big enough to result in an acceptable return for
investors, but small enough to be defined and addressed. Investor is interested
in growth of the company and must have a growth to satisfy the investment.
5.) Customer Identification
A fundamental question is whether the decision to buy your product or service
will require a substantial change in customer behavior, which would significantly
stretch the sales cycle. It is possible to create a product of great benefit
for a specific client base that is unwilling to use it.
Having 2 or 3 competitors may help educate the market, but few investors
will want to go up against companies with well established installed bases
even if you have a superior product or technology. Think of all spreadsheets
packages the competed against Lotus, many were arguably better, but only
one , Excel, was not overwhelmed.
7.) Realistic Projections
Many budding entrepreneurs fail to actually look at their proposition from
the investors' point of view. The investors will take the following approach.
If I put X amount of dollars in today under the following assumption, will
I end up with 10 time the dollars at a certain period in the future? The
projections need to show that a tremendous return is possible, to compensation
for the risk, yet the projections need to be based on number that are realistic,
Historical data should be used if available.
Every individual thinks in his own frame, but somebody on the management
team has to have a long term view. Usually CEO's are the visionaries, but
if they aren't, somebody else has to be.
9.) Risk Calculation
Don't gloss over what could go wrong and what is likely to go wrong. You
can't eliminate risk, but you can mitigate it. Addressing risk demonstrates
the quality of your thought process. Do not leave the risk to the imagination
of the investor. Cover this criteria in your business plan.
10.) Exit Strategy
Many people think of going public as the exit, but not every one can do
it. Companies without
IPO's (Initial Public Offering, "flotation", "going public",
"stock market".) may still be ago investment, but you have to
think about alternative exits, such as management buy out or being acquired
by another company. Venture Capitalists dread ending up with a "living
dead company" that lack the pizzazz for an IPO. Venture Capitalists
want out at a specific time with a healthy return on investment. This can
come from an IPO or management buy out or the company buying their stock.
The most important bit of entrepreneurial homework is identifying who invests
in your particular field. The financial community can be of great help in
determining the viability of your case and the possibility of achieving
the funding you are looking for. Financial Brokers can recommend certain
companies that either fund venture capital needs or who have programs or
contacts that produce the funding. Referrals are important because Venture
Capitalists prefer certain industries or services or products to fund.
Every year we see companies who want the investor to sign a confidentiality
agreement before they discussions. A sure sing of a naive, first time entrepreneur
who thinks the investors are going to try and steal their idea. Most investors
won't sign these agreement. By doing your home work is the ultimate key
to successful investor presentation. When you know whom you should approach,
what they want and how you should proceed, then you won't have to wonder
why they don't call back.