Raising venture capital is nearly impossible as it is, don’t hinder yourself by committing any of these 3 major venture capital financing no-no’s.
Long Business Plan
Common sense will tell you that venture capitalists receive hundreds of businss plans every year. Do you really think that they enjoy reading through 50 pages of fluff? Make sure to cut to the chase when writing a business plan for venture capitalists. Most venture capitalists will be able to make a decision as to whether or not they want to meet with you after reading your 2 page executive summary – don’t bore them with a thick business plan.
Long Investor Presentation
If you are so lucky to be asked to present to a group of venture capitalists, your meeting will probably be scheduled for 1 hour. If you spend 45 minutes to talk through your presnetation you are only leaving yourself 15 minutes for questions. It is in your best interest to keep the presentation t0 15 minutes so that you have time to dialogue and allay all fears or concerns that the potential investors might have.
Long Term Exit Strategy
Venture capitalists want to hit it big and they want to hit it fast. If you go in with the assumption that it might take 10 years for an exit event you will probably chase away most venture capitalists. There are so many great ideas out there that investors could always find a more lucrative business venture in a faster time period than you are offering. You should at least go in with the goal of an exit event in three to five years.
There is so much that goes into the venture capital process, but make sure that you don’t make these 3 deadly mistakes or your venture may meet its demise. Here are 7 keys to writing a business plan executive summary that will catch the eye of a venture capitalist.