| y"> | | | | venture capital route is closed to the vast majority |
| David E. Gumpert, author of Burn Your Business Plan, | | | | of businesses that seek it out. While it might have |
| often tells the story about how he and his partner | | | | seemed back then that nearly every business that |
| failed to raise money after sending their business plan | | | | asked was receiving venture capital, the reality is |
| around to venture capitalists and meeting with | | | | most carefully crafted business plans are rejected |
| several others to make presentations. Disappointed | | | | out of hand by venture capitalists. Second, you'll be |
| by the fruits of their labor, they considered giving up | | | | surprised what you can accomplish without the |
| on their venture in 1995. Fortunately, on the advice | | | | financing you think you so desperately need to stave |
| of their board of advisors, they chose to divert their | | | | off failure. |
| time from massaging the business plan to making | | | | The truth is that it's unlikely a business plan by itself |
| sales. The financing, they were told, would come | | | | will bring funding in the door, unless it is part of an |
| later. | | | | overall marketing strategy. |
| Turns out, they sold enough to stay afloat through | | | | Four Tools To Help Market Your Business Plan To |
| 1996. In 1997, sales failed to grow as quickly as they | | | | Investors |
| expected, so they decided to seek financing again. | | | | The famous motivational speaker Jim Rohn says |
| This time, they expected positive results would be | | | | there are three steps to successful communications: |
| easier to obtain, after all they were fairly well | | | | "Have something good to say, say it well, and say it |
| established now. The board, however, told them to | | | | often." These three steps form the foundation of |
| get out there and promote their business and make | | | | the Business Plan Secrets Revealed manual. They are |
| more sales. | | | | essential to marketing your business plan with the |
| If At First You Don't Succeed... | | | | intent of attracting investors and selling your business |
| Gumpert and his partner instead decided to dust off | | | | plan to them. Here are four tools to help you "say it |
| their old business plan, spend many hours rewriting | | | | often" so you can attract investors and sell your |
| and updating the plan, and to set out once again to | | | | business plan to them. |
| seek financing. And, once again they were turned | | | | One, a concise, well written twenty-five page |
| down. How could this be? In the late 90's, it seemed | | | | business memorandum or "business plan" that builds a |
| like every new Internet-related venture in the world | | | | case to separate your venture from your |
| was obtaining financing. In fact, according to the | | | | competition. You don't need a two-inch thick business |
| MoneyTree Survey, sponsored by Price Waterhouse | | | | plan. Plans this long often lack aim; instead of building |
| Coopers, Venture Economics, and the National | | | | a case that leads investors to decide whether the |
| Venture Capital Association, the amount of venture | | | | business is the right investment for them, they "fire |
| capital - $7.7 billion in 1995 -- had grown to $16.4 billion | | | | away" in hopes that some of the shots will take |
| by 1997. | | | | effect. |
| Nonetheless, the failed financing left Gumpert and his | | | | Two, an effective elevator pitch--a 60-second, |
| partner with two stark choices at this stage: Find | | | | to-the-point verbal pitch for your business--that |
| ways to grow the business without financing or call it | | | | communicates to your customers and investors what |
| quits. They took the first choice. They also engaged | | | | you do in an exciting and engaging way. The ability to |
| public-relations professionals, and succeeded in getting | | | | separate your business from your competitors and |
| several of their most successful corporate clients | | | | get an investor's interest in the short time it takes to |
| written up in business and industry trade publications - | | | | ride up an elevator is critical. |
| with their agency mentioned as the key force behind | | | | Three, an investor relation Web page to build |
| their clients' success. This publicity got the agency's | | | | credibility and help investors quickly get the |
| phones ringing with new prospects, several of which | | | | information they need, when they need it. Of all the |
| converted into additional sales. | | | | communications media available, the Web is |
| As the business grew, they remained on guard about | | | | particularly important. It's fast and available 24/7. With |
| monitoring their expenses and aggressively collecting | | | | it, you can capture leads and automatically keep in |
| receivables. By 1999, they were operating profitably | | | | touch with those who are interested in your business. |
| at $2 million in annual revenues, with nearly 20 | | | | Finally, press releases to help you get your word out. |
| employees. Also, the amount of venture capital being | | | | A press release is the basic tool for gaining the |
| invested nationally had soared to an astounding $55.5 | | | | attention of the media. The public's desire for |
| billion. But, Gumpert and his partner paid little attention | | | | interesting, relevant news remains strong, as does |
| to this; their interest in outside financing had dropped | | | | the importance of carefully selecting relevant target |
| significantly. (By 2000, Venture capital availability | | | | audiences. You are dealing with much more |
| peaked at $85.5 billion.) | | | | skepticism on the part of the public now than there |
| The Power Of Publicity | | | | has been in the past, which makes the evidence and |
| As Gumpert and his partner carried their success into | | | | objectivity in your press release paramount. |
| 1998 and 1999, their promotional efforts eventually | | | | The process of raising money and attracting |
| attracted the attention of a publicly held company | | | | investors isn't easy. If it were, every business idea |
| that was seeking the expertise they offered in | | | | would get funded. You have to use all the tools that |
| developing and managing online content. In December | | | | are available to you, and start looking at this process |
| 1999 this company acquired Gumpert's company, | | | | as a marketing process backed by hard, verifiable |
| NetMarquee. To Gumpert's surprise, the acquirer | | | | evidence. You just don't know when the |
| never asked to see their business plan; it only | | | | plums--investors, on the tree will become ripe--ready |
| wanted to see their financial projections under | | | | to invest. But, you do know that if you do |
| several different scenarios. | | | | everything you can to take care of the tree--water |
| In recounting his financing experience, Gumpert | | | | it, fertilize it, and so on--it will ultimately bear |
| makes two points: First, even during good times, the | | | | fruit--raise money for your business. |