| Now that you have written your business plan, have | | | | 8. How much reporting do you have to do to them? |
| your preliminary financial data in place, you need | | | | After you have looked at the available Angels that |
| money to make it happen. | | | | you can find, the available Venture Capitalist you can |
| How do you find that money? If you have saved up | | | | find, you need to decide which path is the best way |
| some, you can use that, or you can go to friends | | | | to go for your company and your "style". |
| and family and get some money from them, if they | | | | If you are confident that you will need Venture |
| support your concept and think you can do it. (F/F/P | | | | Capital level funding, after you narrow your search |
| phase) | | | | down to the Venture Capitalist you are going to |
| There are two other sources to go to as well, | | | | target, and have answered the above 8 (and a few |
| Angels or Venture Capitalist. | | | | more I'm sure) questions, you need to decide if you |
| An Angel is a person or group that typically gives a | | | | need to go to an Angel first. |
| startup up idea from $25K to as much as $1M (that | | | | At this point you start fine tuning your financial |
| much is typically an Angel Group) to begin developing | | | | section to meet the needs of the Investor you are |
| the Proof of Concept or the product itself. You | | | | going to approach. The over all business plan stays |
| should go to an Angel Funding Source if you need | | | | the same through this process (unless you are fine |
| less than $1M, and typically less than $500K, to get | | | | tuning it to meet development/production needs due |
| your product built, or if your plan requires a Proof of | | | | to feedback, etc.). The only part of the business plan |
| Concept, the Proof of Concept built. | | | | that changes is the Financial Section(s) and that |
| If you go to an Angel or Angel Group you need to | | | | changes based on the target Investors. You already |
| look at some factors before starting to talk to them. | | | | have in your plan the steps to go live and to go to |
| Do some research and find out: | | | | revenue. You have your milestones written down, |
| 1. What the person/group you are interested in | | | | etc, in the plan, and you have "line items" in the |
| asking money from typically invests their money in. | | | | financial section that correspond. |
| 2. If they accept Venture Capital as a future source | | | | Example: |
| of funding. | | | | You are going to create a software/hardware |
| 3. If they are willing to add more cash down the line | | | | intensive service product that requires FCC approval |
| to help reach that "next" milestone. | | | | of the Concept. To create the Proof of Concept to |
| 4. If they have contacts with people that may be | | | | meet the FCC needs, you need $750,000, but to go |
| interested in providing more money should the need | | | | to revenue you will need roughly $35M (which |
| arise. | | | | includes the $750K). You are able to get a Friends |
| 5. If they have contacts that may want to use your | | | | Family/Personal Pockets (F/F/P) round up of $150K. |
| product/services. | | | | Your research shows that the available list of |
| 6. How much control/hands on activity they want to | | | | Venture Capitalist out there that would fund this |
| have with your company. (Do they want to sit on | | | | project require you to have your FCC permits in |
| your Board of Directors or Board of Advisors, do | | | | place, a working model of your service product in |
| they have any say on how the money is spent | | | | place, and 1 solid customer ready to pay for your |
| within the company?) | | | | services once you are able to build out. |
| 7. And if you are going for a lot more money in the | | | | In this example you would need to go to one or |
| near future, if they work with or know any Venture | | | | more Angel Investors to help you reach the |
| Capitalist that like your industry/product type. | | | | remaining $600K to get your prototype up and |
| It is the recommendation of TDBell Enterprises, Inc., | | | | running to do the testing that will satisfy the FCC. |
| that you work with your Angel Investors as an | | | | You would want to find an Angel or Angel Group |
| Equity Play, meaning they get a small portion of your | | | | that allows for future rounds of Venture Capitalist |
| company for the money they invest. We do not | | | | backed funding. This group would hopefully be willing |
| recommend that you use the money as a loan. | | | | to add a bit more in if needed to go past any |
| A Venture Capitalist is typically a person or company | | | | "gotcha's" that may crop up as you answer the FCC |
| that has gone to from one to many people, | | | | requirements. |
| companies, retirement funds or other large pools of | | | | Now that you know you are going to an Angel or |
| money and created a Venture Fund that is geared to | | | | Angels you rewrite your financial section to show an |
| one or more industries/products/services. These | | | | investment of $150K (F/F/P), the need and the use |
| funds typically finance a company from $500K to | | | | of the $600K from the Angels, and when the remain |
| over $200M, taking stock in the company as | | | | investment of $34,250,000 will be requested and |
| "collateral". | | | | how it will be used. |
| Like going to the Angel Investors, you need to look | | | | When you write up your presentation to the Angel(s) |
| at a few things when you go to a Venture Capitalist: | | | | you show the Living business plan, current Financials, |
| 1. Has the person/group invested in companies in | | | | and talk to your needs. |
| your industry? | | | | When you get to the Venture Capitalist later you |
| 2. At what stage of the company (Proof of Concept, | | | | write up your presentation, you show the current |
| Development, Revenue in place (and if so, at level of | | | | business plan, which no longer has the Proof of |
| revenue is required), etc.) | | | | Concept stage in it (it's completed successfully, and |
| 3. Are they going to be Sole Investors at this stage, | | | | not part of your plans now, living business plan |
| or are they going to have other groups joining in this | | | | remember?) but shows next stages over the next |
| round with them. | | | | three to five years as perceived today, with the |
| 4. How involved are they going to get with your | | | | financials now showing how you spent the last |
| company? (Do they want to manage the company, | | | | $750K, and what you will be doing with the next |
| etc?) | | | | $34,250,000 that you are asking from the Venture |
| 5. Do their portfolio companies need your product | | | | Capitalist. |
| and will they introduce you to them if they do? | | | | Following this plan of action in targeting your funding |
| 6. How much of the company stock do they want? | | | | request will save you time, effort and lead to |
| 7. Will they add more funds to the company should it | | | | stronger successes! |
| be needed? (And if so, at what cost to you?) | | | | |