| During the second quarter of 2009, U.S. Venture | | | | strategy. |
| Capital funds raised $1.7 billion vs. $9.3 billion in the | | | | 5. Unique Selling Proposition (USP) - What is unique |
| second quarter of 2008, representing a drop of | | | | about your product or service offering and why |
| almost 82 percent! This startling statistic reinforces | | | | would a client pay you money vs. all the competition |
| the fact that you MUST be prepared when trying to | | | | in the market? (for emerging technologies where |
| raise capital with Venture Capital firms. Companies are | | | | there isn't business competition, you're competing |
| going after a much smaller pool of capital, so Venture | | | | against inertia) |
| Capital firms will only fund your company if you're | | | | 6. Management Team - Who will be running the |
| presented in a way that's professional, memorable | | | | business and how are they uniquely qualified to make |
| and believable. | | | | your company successful? |
| Here is a checklist of 8 things to address that can | | | | 7. Financial Projections - Remember, investors will only |
| increase your chances of gaining interest from | | | | invest in your company if you can show them how |
| Venture Capital firms: | | | | you will make them money. Your five year financial |
| | | | projections should clearly demonstrate how you will |
| 1. Be honest with yourself - Is your company a viable | | | | do this...but they need to be believable or you're |
| candidate for Venture Capital? If you go through all | | | | wasting your time. Nothing turns off an investor |
| the steps in preparing an Executive Summary | | | | faster than projections of your company reaching |
| Business Plan, you'll have the answer to that question. | | | | unrealistic revenue targets. |
| You may have a very viable business but it may not | | | | 8. Funding Request - Many business plans fail to |
| be a Venture Capital candidate. | | | | include how much capital they require and its uses. If |
| 2. Problem or Opportunity - What specific problem or | | | | you are requesting a certain amount for Phase 1 and |
| opportunity are you addressing with your product or | | | | plan a subsequent round for a later Phase, state that |
| service? You need to be clear about the pain or | | | | as specifically as you can. These are only a few |
| opportunity and how you're going to reduce costs, | | | | areas that must be addressed to be successful in |
| increase revenue, reduce time-to-market, etc. | | | | raising the financing you need for your company. You |
| 3. Solution - How are you going to fix the problem? | | | | need to get "thick-skinned" when dealing with |
| What hardware, software, and services are you | | | | rejection because a low percentage of deals actually |
| offering? | | | | get funded with Venture Capital. Following these |
| 4. Market Opportunity - What specific market | | | | steps will not guarantee you success but will greatly |
| segment are you targeting? Remember, there are | | | | increase the chances of raising capital for your |
| riches in niches! You'll show that you've done the | | | | company when properly prepared. |
| research needed to have a strong go-to-market | | | | |