The term VENTURE CAPITAL
seems swallowed up in mystique, as is a business
plan for venture capital investment. These aren't just investors. These are the investors that hold the key to the future for many companies.
Sadly, no more than 2% to 5%
of the companies looking for venture capital actually get it.
But that small percentage -- that
2% to 5% -- knows something that the others don't. The successfully funded
companies know how to position their companies, and how to present them, how to
capture the venture capitalist's attention.
Obviously, this is no small
accomplishment, so let's take a closer look at it.
First:
positioning companies. This means placing the company in a successful
industry, especially one that the venture capitalist knows well. For instance,
being a chip manufacturer is probably a pretty good business; but being a chip
manufacturer in the defense industry in an emerging technology niche is a
whopping good business. Being a successful retailer is a strong recommendation;
having a chain of ten successful stores is a very strong recommendation.
It's that "whopping
good" business, that "very strong recommendation" that venture
capitalists look for.
 |
 |
 |
| Your 7-Step Business Plan
may be just the catalyst you need to create a spectacular business plan,
one that truly reflects your business. Lots of options, lots of
successes. Click on the book
covers for more information. |
Venture capitalists need a sense
of "Wow".
And it is the business plan that
must present that "Wow" to them. Without
a strong business plan, there will be no further discussions. Period.
And that is the
second thing that successfully funded companies know: presentation may not be
everything, but without it, there is nothing.
Business plans for venture capital
will have the most unique approach of all. The SBA and banks don't demand the
top quality presentations that venture capitalists demand.
This business plan cannot be
"canned". Entrepreneurs who use business plan templates at this level
of funding won't get this level of funding.
The presentation must be sophisticated,
complete, accurate and -- yes -- dynamic. It must represent
the company just like an ad in Business Week or The Wall Street Journal would
represent the company.
I strongly recommend 3 steps for
companies looking for venture capital:
1. More than any other type of
business plan, yours must have a solid foundation of marketing
stats. Research, research, research.
2. Create
the most outstanding business plan possible. There is no second
"up", so make that first impression count.
3. Create
an outstanding website. Whether your company's business is based on the
internet or not, a strong presence here is essential.
It's an axiom that venture capitalists don't invest in
companies, they invest in people. Without doubt, an exceptionally
strong management team with a so-so product will get a better response than a
weak entrepreneur with a good product. The theory is that it's easier to improve
a product than it is to improve the people behind it. So strut your stuff -- the
VCs are watching. (That means "make that business plan so outstanding that
they can't refuse, no matter what the product is.")
Back to top of Business Plans for Venture Capital
