Unfortunately, the overwhelming majority of entrepreneurs that contact me, seeking funding do not realize that you make one first impression with potential investors, and if you are not prepared, you destroy your chances of receiving funding.
Please read this advice before contacting me to improve your chances of receiving funding.
BEFORE YOU CONTACT ME…
Have a fully completed BRIEF (less than 50 pages for an existing company, less than 20 for a start-up pre revenue company, investors want to read a marketing “tease” not a novel) business plan which contains executive biographies of ALL upper management, describing their successful experience building profitable companies at their current and prior employers.
Have a fully completed “realistic & conservative” pro forma budget for at least the next 3 years through 2014 with attainable projected numbers. Investors lose respect for “dreamers” who project unrealistic projected profits. Never proclaim your company to be a risk-free investment, all potential investments have varying degrees of risk, you will immediately lose credibility. Never say “I have a great idea.” Proclaiming you have an idea is like saying “I have an opinion,” everybody has one, show an investor what you are doing (or will do) to earn revenue, that is what an investor wants to see.
Have a fully completed draw-down schedule that explains a timeline of the money you are seeking in U.S. Dollars.
Have audited financial statements immediately available because you will be asked to submit them for review.
Research your industry, you will need to explain your company, your industry, how your company fits within the industry, know the amount of revenue and profits your industry has currently and projected industry revenue and profits.
Go to a bank, and ask about the funding process of applying for a loan (whether you seek a loan, equity, or a combination of both), so that you realize that you are expected to answer many questions about your personal and corporate finances. You will learn that ALL potential investors do not hand millions of dollars to strangers without performing due diligence beforehand to verify the accuracy of the submitted business plan, executive biographies, the credibility of your pro forma budget compared to other companies within the same industry, and a thorough background check (personal & corporate) of all upper management of your company. You will also learn that the applicant has fees related to applying to receive funding because investors will not research your company via due diligence at their own expense, they are in business to seek potentially profitable investments and unfortunately many investment opportunities submitted to them are not potentially profitable investments.
Be honest with all submitted paperwork and with answers to all questions. Sadly, this seems like common sense, but I have seen an alarming percentage of applicants destroy their chances of receiving funding by lying and committing fraud. You are asking a potential investor to become your business partner either through a debt, or equity (or combination) investment. All relationships (business & personal) are based upon trust. Once you violate that trust by lying and submitting a fraudulent application to receive funding, your chances of receiving funding are zero. Due diligence is thorough. Banks and private investors consist of multi-millionaires and billionaires who did not become successful and wealthy by making moronic business decisions. Your credibility and opportunity to receive funding improves when investors perform due diligence and verify that you are honest, their trust in you and their desire to become your business partner increases if they can verify that you are honest. Due diligence is something you should embrace if you are honest because it increases your chances of receiving funding if an investor can verify that you are truthful and credible, it separates you from the applicants who lie and commit fraud.
Research the funding industry and what “credible” investment terms should be. If you are the C.E.O. of a start-up (pre revenue) company with no financial statements showing that you know how to manage a cash flow, collect accounts receivable, acquire other assets, revenue, E.B.I.T.D.A., and net profit and you are asking for millions of dollars in exchange for equity only, stop and think about how an investor will perceive you, your company, and your expectations. A company with no cash, no customers and no revenue is wasting everyone’s time asking for equity only because investors will not buy ownership in a company with no assets in exchange for millions of dollars, it’s illogical and not expected to be a profitable investment opportunity. If you are a start-up (pre revenue) company you need to expect to receive an offer for funding in exchange for debt and consider yourself fortunate if an investor wants the offer to be part equity in addition to debt, otherwise you’re wasting everyone’s time.
This feedback is designed to help you because applicants who do not receive funding routinely make some combination of the errors I just mentioned, learn from the mistakes of others so that your company does receive funding.
If you need help send an e-mail to info@ventures2b.eu
Please read this advice before contacting me to improve your chances of receiving funding.
BEFORE YOU CONTACT ME…
Have a fully completed BRIEF (less than 50 pages for an existing company, less than 20 for a start-up pre revenue company, investors want to read a marketing “tease” not a novel) business plan which contains executive biographies of ALL upper management, describing their successful experience building profitable companies at their current and prior employers.
Have a fully completed “realistic & conservative” pro forma budget for at least the next 3 years through 2014 with attainable projected numbers. Investors lose respect for “dreamers” who project unrealistic projected profits. Never proclaim your company to be a risk-free investment, all potential investments have varying degrees of risk, you will immediately lose credibility. Never say “I have a great idea.” Proclaiming you have an idea is like saying “I have an opinion,” everybody has one, show an investor what you are doing (or will do) to earn revenue, that is what an investor wants to see.
Have a fully completed draw-down schedule that explains a timeline of the money you are seeking in U.S. Dollars.
Have audited financial statements immediately available because you will be asked to submit them for review.
Research your industry, you will need to explain your company, your industry, how your company fits within the industry, know the amount of revenue and profits your industry has currently and projected industry revenue and profits.
Go to a bank, and ask about the funding process of applying for a loan (whether you seek a loan, equity, or a combination of both), so that you realize that you are expected to answer many questions about your personal and corporate finances. You will learn that ALL potential investors do not hand millions of dollars to strangers without performing due diligence beforehand to verify the accuracy of the submitted business plan, executive biographies, the credibility of your pro forma budget compared to other companies within the same industry, and a thorough background check (personal & corporate) of all upper management of your company. You will also learn that the applicant has fees related to applying to receive funding because investors will not research your company via due diligence at their own expense, they are in business to seek potentially profitable investments and unfortunately many investment opportunities submitted to them are not potentially profitable investments.
Be honest with all submitted paperwork and with answers to all questions. Sadly, this seems like common sense, but I have seen an alarming percentage of applicants destroy their chances of receiving funding by lying and committing fraud. You are asking a potential investor to become your business partner either through a debt, or equity (or combination) investment. All relationships (business & personal) are based upon trust. Once you violate that trust by lying and submitting a fraudulent application to receive funding, your chances of receiving funding are zero. Due diligence is thorough. Banks and private investors consist of multi-millionaires and billionaires who did not become successful and wealthy by making moronic business decisions. Your credibility and opportunity to receive funding improves when investors perform due diligence and verify that you are honest, their trust in you and their desire to become your business partner increases if they can verify that you are honest. Due diligence is something you should embrace if you are honest because it increases your chances of receiving funding if an investor can verify that you are truthful and credible, it separates you from the applicants who lie and commit fraud.
Research the funding industry and what “credible” investment terms should be. If you are the C.E.O. of a start-up (pre revenue) company with no financial statements showing that you know how to manage a cash flow, collect accounts receivable, acquire other assets, revenue, E.B.I.T.D.A., and net profit and you are asking for millions of dollars in exchange for equity only, stop and think about how an investor will perceive you, your company, and your expectations. A company with no cash, no customers and no revenue is wasting everyone’s time asking for equity only because investors will not buy ownership in a company with no assets in exchange for millions of dollars, it’s illogical and not expected to be a profitable investment opportunity. If you are a start-up (pre revenue) company you need to expect to receive an offer for funding in exchange for debt and consider yourself fortunate if an investor wants the offer to be part equity in addition to debt, otherwise you’re wasting everyone’s time.
This feedback is designed to help you because applicants who do not receive funding routinely make some combination of the errors I just mentioned, learn from the mistakes of others so that your company does receive funding.
If you need help send an e-mail to info@ventures2b.eu