5 Important Factors To Consider Before Your Company Valuation

5 Important Factors to Consider Before Valuing Your Company

You may want to know how much your startup business is worth today based on the growing market. Or does your company look like a nice, well-organized, well-colored bungalow? And maybe you want to recreate it; It is big and makes a nice building.

Well, today we will talk about 5 important factors that professionals consider when evaluating a company that I think you should keep in your notes.

On the other hand, I suggest that young and aspiring entrepreneurs should take these important issues seriously. What I mean is that this is what happens when you want to buy or sell real estate in a particular location. I mean you should know the factors that make a house in that place at a certain cost. You must be informed so that you neither buy above nor sell below what the market is willing to pay at a given time.

Company valuation

Company valuation is based on the value of your assets and future earning potential that you can develop and lead to future success, which may or may not be material.

So now, 5 important things that I think you should know before evaluating your company/startup company:

#5. The market price of the stock of a corporation in the same industry whose stock is actively traded on an open market or exchange.

As you know there are many industries. There is medical industry, transport industry, music industry, construction industry etc. So what that means is, for example, you build some software. Market value of stocks of Dell, Microsoft, etc., which are in the same industry as you as software makers. Now, he will consider how valuable you are.

#4. Financial backers will esteem your gross block value interest. This means that professionals will count and value your company's total assets such as computers, furniture, buildings and cash.

#3. The company's common stock equity, as seen on the balance sheet, and the current financial position of the business. Again, you have to present the securities to your shareholders. Example: Providing shareholders with voting rights and entitlement to a share of the company's profits through a capital increase, as detailed on your balance sheet. And then, is the company moving forward financially or into liquidation? How is financial health?

#2. General economic forecasts and conditions, and specific industry outlooks in particular. It's like I mentioned above, (art). We should accept the development business for instance. What is the value of the manufacturing industry in your country's economy or as a manufacturer in the world market?

So the terms behind that question will, in a way, apply to the valuation of your company. What I mean by this is that investors are going to value your company's fundamentals.

#1 The nature of the enterprise and the history of the beginning of the business. Professionals want to know whether the business is a high risk business or vice versa. The basics of the business, how it started, how you managed to build your team members, marketing strategies and more.

Conclusion: The value of your company is first considered based on the total assets of the company, followed by the 5 important factors we just talked about. If there is any other factor which is not listed, you can add it in the comment section, or share it with your friends. Until next time.

9 Things to Consider Before Forming a Business Partnership

There are advantages to forming business partnerships. It allows all contributors to share a part of the business. Depending on the risk-taking ability of the partners, businesses may have general or limited liability partnerships. Limited partners are only there to provide funds for the business. They have no role in running the business, nor do they share responsibility for any debts or other business obligations. General partners manage the business and share their liabilities. Because limited liability partnerships require a lot of paperwork, people usually form general partnerships in business.

Interesting points prior to laying out a business organization

Business partnerships are a great way to share your profits and losses with someone you can trust. However, a poorly executed partnership can be a disaster for the business. Here are some effective ways to protect your interests when forming a new business partnership:

1. Be sure of why you need a partner

Prior to going into a business organization with somebody, you want to wonder why you want an accomplice. If you are just looking for an investor, a limited liability partnership is sufficient. However, if you are trying to create a tax shield for your business, a general partnership would be a better option.

Business partners should complement each other in terms of experience and expertise. If you're a technology enthusiast, working closely with a professional with extensive marketing experience can be extremely rewarding.

2. Understanding your partner's current financial situation

Before asking someone to do your business, you need to understand their financial situation. When starting a business, some initial capital may be required. If business partners have sufficient financial resources, they will not need funds from other sources. This will reduce the firm's debt and increase owner's equity.

3. Background check

Even if you trust someone as your business partner, there is no harm in doing a background check. Calling some professional and personal references can give you a fair idea of their work ethic. A background check helps you avoid any future surprises when you start working with your business partner. If your business partner has a habit of sitting for long periods and you don't, you can divide the responsibilities accordingly.

It's a good idea to check if your partner has any prior experience running a new business venture. This will tell you how they performed in their previous attempts

4. Hire an attorney to check the partnership documents

Be sure to seek legal advice before signing any partnership agreement. This is one of the most effective ways to protect your rights and interests in a business partnership. It is important to have a good understanding of each clause, as a poorly written contract can leave you in liability trouble.

You must ensure that any relevant clauses are added or deleted before entering into the partnership. Because it is difficult to amend the contract after signing.

5. Partnership should be based on commercial terms only

Business associations ought not be founded on private connections or inclinations. There should be a strong accountability mechanism from day one to track performance. Responsibilities should be clearly defined and performance metrics should indicate each individual's contribution to the business.

Weak accountability and performance measurement systems are one of the reasons many partnerships fail. Instead of putting in their efforts, the owners start blaming each other for the wrong decisions and the consequent loss of the company.

6. Your business partner's level of commitment

All organizations start amicable and with extraordinary energy. However, some people lose their enthusiasm along the way due to the daily drudgery. Therefore, you need to understand the level of commitment of your partner before entering into a business partnership with them.

Your business partner should be able to demonstrate the same level of commitment to each stage of the business. If they are not committed to the business, it will reflect in their work and can even be detrimental to the business. The best way to maintain the level of commitment of each business partner is to set high expectations from each individual from day one.

When entering into a partnership agreement, your partner should be aware of additional responsibilities. Responsibilities such as caring for aging parents should be given due consideration in order to set realistic expectations. This leaves room for empathy and flexibility in your work ethic.

7. What happens if a partner leaves the business

All organizations start amicable and with extraordinary energy. It will outline what happens if a partner wants to exit the business. In such a situation some questions need to be answered:

How will the departing party be compensated?

How will the property be divided among the remaining business partners?

Also, how do you divide up the responsibilities?

8. Who will be responsible for everyday tasks

Even if there is a 50-50 partnership, someone should be in charge of the daily operations. Positions including CEO and directors should be assigned from the outset to appropriate individuals including business partners.

It helps in creating an organizational structure and further defines the roles and responsibilities of each stakeholder. When each person knows what is expected of them, they are more likely to perform better in their roles.

9. You Share the Same Values and Vision

Entering into a business partnership with someone who shares similar values and outlook makes day-to-day operations much easier. You can quickly make important business decisions and set long-term strategies. However, sometimes, even the most like-minded people can agree on important decisions. In such a situation, it is important that the long term goals of the business are kept in mind.

last line

Business partnerships are a great way to share liabilities and raise funds when setting up a new business. For a business partnership to be successful, it is important to find a partner who will help you make decisions beneficial to the business. Hence, pay attention to the integral aspects mentioned above, as a weak partner can prove to be detrimental to your new venture.

Best TOP INVESTOR PITCH DECK MISTAKES AND WHAT TO DO

Top 5 Investor Pitch Deck Mistakes and What To Do Instead

It's a competitive world. Competition for investor funds is fierce. There is much talk about how to position your product positively against the competition. But how do you compete with thousands of startup entrepreneurs who want to grab a share of the same funding pool?

One way to set yourself apart from the crowd is to make your pitch look like a strong competitor. Get investors excited. Here's how to avoid common pitch deck mistakes.

Here are the best 5 pitch deck mix-ups and what to do all things considered:

1. Botch: Pitch the item - Arrangement: Pitch the business

Investors don't invest in ideas. They don't invest in products. They invest in business. Investors invest because they want to one day get a hefty return on their investment. A product does not give them returns. Can be an effective, profitable and sustainable business. If you have traction, go with it. There's nothing better than proving what the market wants, needs and will buy.

2. Mistake: Verbose - Solution: Be concise

Many pitch decks are verbose. They are misleading and investors are checking out instead of writing checks. From the beginning, give a specific and concise description of the problem you're solving, who it's for, and why your solution is above all else. Prevent contact. Arrive at the point rapidly with your most memorable slide.

3. Botch: Longwinded slides - Arrangement: Visuals and list items

Pitch deck slides are loaded with what the presenter is going to say Entrepreneurs can read - and they can read faster than you can talk. Investors expect you to know your material without reading it. Place only primary points on the slide, a single primary point will work. Consider using stunning visuals to drive your point rather than a bunch of words on a slide. Visuals convey a clear message and engage the audience emotionally. And while we're on the subject of slide presentations, let's ditch the animations and transitions. They are distracted from the focus of your pitch.

4. Mistake: Focus on technology (or product features) - Solution: Focus on delivery

Your pitch deck should show that you know what it takes to get, keep and grow clients in a competitive market. This is an important slide because investors want a clear picture of how you plan to get your amazing product into the hands of lots of customers A broad generalization like "social media networking" is a strategy, not a technique. Show that you spent a lot of time and energy creating an effective distribution plan and taking advantage of your unfair advantage.

5. Mistake: One size fits all - Solution: Appropriate pitch

Many pitch decks are cookie-cutter template-based presentations that are presented to all types of audiences, including investors, channel sales partners, and strategic partners. Know your audience. Tailor your pitch to your specific audience. How does your business fit in with the rest of their portfolio? Do your homework, how it is in the middle of their investment "sweet spot". Specifically your pitch, your business story, presented to the audience.

If you want an investor to be serious about your business, be serious about your pitch deck. Approach your pitch from an investor's perspective. Guarantee each slide has a "How should this help me?" And why should I care?" The key is to focus in on what's on your reasonable monetary patron's mind. Turn your pitch into a well-told story.

Most start-ups struggle and fail. Valerie specializes in the success of fast growing start up businesses. He helps start up entrepreneurs get, keep and grow customers and excite investors. Start up entrepreneurs and founders. Avoid the big and costly mistakes that derail so many start-up's, even those with great ideas.

CONCLUSION

Your pitch deck should show that you know what it takes to get, keep and grow clients in a competitive market. Many pitch decks are cookie-cutter template-based presentations that are presented to all types of audiences, including investors, channel sales partners, and strategic partners. Specifically your pitch, your business story, presented to the audience. If you want an investor to be serious about your business, be serious about your pitch deck. Valerie specializes in the success of fast growing start up businesses. He helps start up entrepreneurs get, keep and grow customers and excite investors.

A Guide To 9 THINGS TO CONSIDER BEFORE FORMING A BUSINESS PARTNERSHIP At Any Age

9 Things to Consider Before Forming a Business Partnership

They have no role in running the business, nor do they share responsibility for any debts or other business obligations.

Because limited liability partnerships require so much paperwork, people usually form general partnerships in businesses.

There are advantages to entering into business partnerships. It allows all contributors to share the business part. Depending on the risk-taking ability of the partners, businesses may have general or limited liability partnerships. Limited partners are only there to provide funds for the business. They have no role in running the business, nor do they share responsibility for any debts or other business obligations. General partners manage the business and also share its liabilities. Because limited liability partnerships require so much paperwork, people usually form general partnerships in businesses.

Things to consider before establishing a business partnershi

Business partnerships are a great way to share your profits and losses that you can rely on. However, a poorly executed partnership can be a disaster for the business. Here are some effective ways to protect your interests when forming a new business partnership:

1. Determine why you need a partner

Prior to going into a business organization with somebody, you really want to wonder why you really want an accomplice. If you are looking for just one investor, a limited liability partnership is sufficient. However, if you are trying to create a tax shield for your business, a general partnership would be a better option.

Business partners should complement each other in terms of experience and expertise. If you're a technology enthusiast, working closely with a professional with extensive marketing experience can be extremely beneficial.

2. Understanding your partner's current financial situation

Before asking someone to do your business, you need to understand their financial situation. When starting a business, some amount of initial capital may be required. If business partners have sufficient financial resources, they will not need funds from other sources. This will reduce the firm's debt and increase owner's equity.

3. Background check

Even if you trust someone as your business partner, it doesn't hurt to run a background check. You can get a fair idea about their work ethic by calling some professional and personal references. A background check helps you avoid any future surprises when you start working with your business partner. If your business partner has a habit of staying up late and you don't, you can share the responsibilities accordingly.

It's a good idea to check if your partner has any prior experience running a new business venture. This will tell you how they performed in their previous attempts

4. Call an attorney to check the partnership documents

Be sure to seek legal advice before signing any partnership agreement. This is one of the most effective ways to protect your rights and interests in a business partnership. It is important to have a good understanding of each clause, as a poorly written contract can leave you in liability trouble.

You must ensure that any relevant clauses are added or deleted before entering into the partnership. Because once the contract is signed it is difficult to modify it.

5. Partnership should be based on commercial terms only

Business associations ought not be founded on private connections or inclinations. A strong accountability system should be in place from day one to track performance. Responsibilities should be clearly defined and performance metrics should indicate each person's contribution to the business.

Poor accountability and performance measurement systems are among the reasons many partnerships fail. Instead of putting in their efforts, the owners start blaming each other for wrong decisions and the resulting loss of the company.

6. Your business partner's level of commitment

All partnerships begin on friendly terms and with great enthusiasm. However, some people lose their enthusiasm along the way due to the daily drudgery. Therefore, you need to understand the level of commitment of your partner before entering into a business partnership with them.

Your business partner should be able to demonstrate the same level of commitment to each stage of the business. If they are not committed to the business, it will reflect in their work and can even be detrimental to the business. The best way to maintain the level of commitment of each business partner is to set high expectations from each individual from day one.

When entering into a partnership agreement, your partner should be aware of additional responsibilities. Responsibilities such as caring for aging parents should be given due consideration in order to set realistic expectations. This leaves room for empathy and flexibility in your work ethic.

7. What happens if a partner leaves the business

It will outline what happens if a partner wants to exit the business. In such a situation some questions need to be answered:

How will the departing party be compensated?

How will the property be divided among the remaining business partners?

Also, how do you divide up the responsibilities?

8. Who will be in charge of daily operations

Even if there is a 50-50 partnership, someone should be in charge of the daily operations. Positions including CEO and directors should be assigned from the outset to appropriate individuals including business partners.

It helps in creating an organizational structure and further defines the roles and responsibilities of each stakeholder. When each person knows what is expected of them, they are more likely to perform better in their roles.

9. You Share the Same Values and Vision

Entering into a business partnership with someone who shares similar values and outlook makes day-to-day operations much easier. You can quickly make important business decisions and set long-term strategies. However, sometimes, even the most like-minded people can agree on important decisions. In such a situation, it is important that the long term goals of the business are kept in mind.

last line

Business partnerships are a great way to share liabilities and raise funds when setting up a new business. For a business partnership to be successful, it is important to find a partner who will help you make decisions beneficial to the business. Hence, pay attention to the integral aspects mentioned above, as a weak partner can prove to be detrimental to your new venture.

CONCLUSION

7. What happens if a partner leaves the business. It will outline what happens if a partner wants to exit the business. 8. Who will be in charge of daily operations. Even if there is a 50-50 partnership, someone should be in charge of the daily operations. It helps in creating an organizational structure and further defines the roles and responsibilities of each stakeholder. 9. You Share the Same Values and Vision. You can quickly make important business decisions and set long-term strategies. However, sometimes, even the most like-minded people can agree on important decisions. Business partnerships are a great way to share liabilities and raise funds when setting up a new business.

Apply These 5 Secret Techniques To Improve ELEVEN STEPS TO BUYING A BUSINESS

The Secrets To 

ELEVEN STEPS TO BUYING A BUSINESS

Buying an established business can be a difficult and complicated process for many individuals. By understanding the steps involved in an acquisition and doing the necessary planning and preparation, buyers will be able to increase their chances of a successful transaction. Following an established and proven process can not only reduce the stress that often comes with hiring new territory but also eliminate many of the risks and unknowns that often derail business acquisitions.

Personal assessment

Introspection is the initial phase in the business purchase process. This process should be a thoughtful and honest examination of candidates' strengths and weaknesses, skill sets, as well as their likes and dislikes. This analysis will help narrow down the selection of business ventures to the logical and best option to pursue.

What kinds of talents, skills, and experiences do you bring to the table and what kinds of businesses can excel with these traits in the back of your mind? Here are several questions that should be included in the introspection phase:

What sort of enterprise do you wish to operate?

Are you the owner/manager or do you prefer to have a management team?

How many hours are you available to devote to the business?

Obviously, owning a small business is never going to be a 9 to 5 endeavour. Having said that, it is important to determine the time available for running the business. Do you prefer a B2B business that operates Mf 8-6 or would you consider a more flexible and consumer oriented business that is open late or often on weekends?

Are you successful in sales, meeting customers and being the face of the business or are you better suited to a managerial role and running the business behind the scenes with an established sales force?

Are you able to travel and be away from home for long periods of time or do you need a business that will keep you close to family every day of the week?

Do you have a background and expertise in product manufacturing or is a service industry or delivery model more typical for you?

Do you have a license or certification that qualifies you for a particular occupation? If not, are you prepared to acquire the necessary certifications for successful ownership if the target business requires such certification?

What are the things that you are really enjoying? Don't you like doing that? The best advice is to start by looking at businesses in the industry that the buyer is interested in.

These are questions that will help a person assess what type of business they are best suited for and narrow down the range of initiatives where the buyer's skill sets, experiences, abilities and passions can be leveraged.

Develop investment criteria

Now that you have established the type of business that is a 'good fit' the next step is to put pen to paper and briefly define your investment criteria. If you're seeking bank financing, it's important that the investment criteria match your resume or the transferable skills you bring to the table. The investment criteria should mention the following:

What is the price range of a business you can buy?

What is the geographic location of the business you want to buy?

What kind of business are you looking for?

production

Wholesale distribution

service

Retail

Web based

What industry should the business be in?

What type of management structure—owned and operated or managed by a team—is in place?

Size of the business. According to: revenue profit/income

Number of employees number of places

Recurring revenue model vs project based

Lender pre-qualification

If you plan to use bank financing to acquire a business, it's important to get pre-qualified before your search process. This 'prequel' will not only give you data on how good a business you can buy, but it will also prove to brokers and sellers that you are a serious buyer. If you are serious about buying a business and need to get financing, getting a bank pre-qualification is an essential step. So, what could be the reason for initially postponing it and not implementing it? 

There are zero downsides and just enough profit. Contact your business broker as they will be able to recommend a financial institution that offers business acquisition loans for the type of business you are looking to purchase. This is one area where having the right lender is important.

Business Search (Individual or Retired)

What process do you follow to identify and qualify businesses for purchase? Will you be doing the search yourself or will you be using the services of a professional business intermediary or broker? There are literally thousands of businesses for sale at any given time. 

A process needs to be established to find and manage eligible businesses. Some of these businesses have levels of quality, potential and profitability that set them apart as best of their breed. What have you done to ensure that you stand out and are properly considered when hiring a broker for a business for sale? Businesses for Sale The market is plagued with ready and non-serious buyers inquiring about any enterprise listed for sale. 

It takes the right preparation, messaging and professional team to establish communication and quickly reach the point where the business can be qualified as a valid candidate or dismissed. Many potential buyers fall prey to the business internet search process of late and click on any business that interests them. Unfortunately, serious buyers get lost in the area. This is where the pre-stages come in handy – a personal resume, an established investment criteria as well as lender pre-approval.

Ability

A professionally represented business for sale will have several documents available for review by potential buyers (such as financials, list of assets, business summary, etc.). Buyers must execute an NDA in addition to demonstrating that they are worthy of being considered a serious candidate, both from a financial perspective and from an experience perspective.

At this stage the buyer should have already done independent research or have a basic knowledge of the industry. There are trade magazines for any business sector, not to mention the wealth of data available on the World Wide Web without direct industry experience.

The buyer should have a list of questions prepared beforehand, designed for one purpose – determining whether the business meets most of the elements of the investment criteria. The buyer must understand the value of the business. 

If the business value is beyond their financial means then they should not value the business and waste no one's time, most importantly their own. It is important for a serious buyer to recognize that there is no such thing as a perfect business and that each has different strengths and weaknesses. 

Most buyers are looking for businesses with growing revenue, a steady customer base, excellent employees, established policies and procedures, and growing profits. What are the most important qualities you are looking for? Ranking criteria are often helpful when qualifying businesses. Finding a business that meets some of the criteria but doesn't meet all of the criteria is more the norm than the exception. 

In many cases, the buyer may be positioned and experienced to rectify deficiencies in certain business aspects. Following this approach will enable the buyer to quickly and efficiently eliminate businesses that will not be a good fit, an effort that will save all parties considerable time. Fast numbers are much better for everyone than slow numbers. Finally, the buyer should understand that the better the business, the more they can expect to pay.

After the initial information exchange, the buyer should prepare a second set of questions based on the specific business description. After receiving this information comes the time when the buyer finds out whether their basic criteria have been met or not. The buyer needs to be clear about business valuation, financials and business operations and the seller (through a broker) needs to be clear about how the candidate will finance the transaction.

A teleconference should be arranged by the business broker to fill in any gaps in information and to allow specific business questions to be asked by the buyer and to be answered directly by the seller. If this interaction meets the needs of all parties, often a personal meeting and site visit is arranged. 

During this meeting, the buyer, seller, and broker can negotiate a transaction structure that will meet each party's needs. Only serious competitors should participate at this time. If the goal isn't making progress, now is not the time to waste being a tire-kicker. Buyers should be clear that even after the NDA is signed, data such as the names of specific customers will not be disclosed not only at this time, but until the transaction closes.

LETTER OF INTENT – RULE LETTER

Letters of Intent (LOI) and Term Sheets are generally non-binding documents that are used for one basic purpose... to determine if there is a difference of opinion between the buyer and the seller on the price and terms of the sale. 

The LOI will outline the strategic points of the agreement. Investing time and preparing more detailed documents at this stage will avoid misunderstandings and keep key terms from being renegotiated later. Some broad points that need to be addressed include:

Who is buying the business?

What is being acquired (property, stock)

Transaction costs and how that money is paid

Date of Loan Commitment Letter.

Proposed closing date.

Is there a consulting contract and if so, what are the terms?

What are the conditions for closing the transaction?

Loan Commitment Letter

With the LOI executed (signed), the buyer must now obtain a 'Loan Commitment Letter' from the lender. A loan commitment letter is drawn up by the bank and will confirm that the buyer has been approved for financing to acquire the business. The loan commitment letter is prepared after a thorough review of both the buyer's data as well as the target business's data.

Due diligence

Most business acquisition transactions will require bank funding. The bank will have a proven, structured and highly detailed due diligence process and this is the process the buyer should rely on when acquiring business. Why try to reinvent the wheel? 

Banks act only on behalf of the buyer and their basic interest is that the buyer is acquiring a business that has the financial structure necessary for the new owner to succeed and repay the principal and interest on the acquisition loan. The bank will provide a DD checklist containing various types of documents, including but not limited to the following:

Financial statements and tax returns. Assets and inventory list an equivalent. Corporate books and records. Contingent Liability

Sales and marketing materials

Employee contracts and benefit plans

Lease of equipment, vehicles and property

Customer and supplier agreements or other agreements

Insurance policy

Purchase Agreement

After the LOI is executed, the Business Agreement for Sale aka Definitive Purchase Agreement (DPA) is usually drawn up by the buyer's 'Transaction Attorney'. If proper care is taken in preparing the LOI, the DPA should be a very simple document to submit. In situations where key contractual elements are not properly discussed or resolved in the LOI, the DPA becomes complex and has a higher level of risk associated with closing the transaction.

After execution of LOI, DD period starts and drafting of DPA should start. The DPA is a binding agreement that covers all aspects of the transaction. The DPA will cover all assets related to the purchase, including but not limited to:

Acquiring assets/stocks

Price, Terms and Payment

Representations and Warranties. contract premium Non-competition agreement. 

Lease Assignment

Consent of Landlord

Consulting Agreement

Resource allocation

In most transactions the DPA is executed at the closing table but is not a requirement. Under certain circumstances, Buyer and Seller may elect to execute this Agreement prior to actual closing.

The DPA is the actual agreement that completes the sale of the business. It will include several schedules and exhibits detailing all terms of sale. This is a custom contract and the details, length and partner schedule and level of engagement are based on the specific business.

At this stage the buyer should already set up their new business entity (assuming it's not a stock sale), create business bank accounts, create insurance policies, merchant credit card accounts (if applicable) etc.

The End

Closing should be the easiest part of the process. Why? Because all the above steps have been relentlessly followed by both parties. "Closing" for a sales transaction for a business is simply the process by which both the buyer and seller execute (sign) all the documents that have already been discussed and agreed upon. 

Having the right transaction team (transaction lawyers, business brokers and lenders) from the start will make it a smooth process. Each advisor has their own role and when done right, closing becomes a seamless process.

The Truth About WRITE WINNING PROPOSALS FOR VENTURE CAPITALISTS

Write winning proposals for venture capitalists

A venture capitalist sees your project as a pure investment.

By preparing an investor-focused business plan, it will be clear to the venture capitalists that you are focused, prepared and competent.

You must secure the money for your project. You visit venture capitalists to see if you can get these funds. A venture capitalist sees your project as a pure investment. The venture capitalist has no emotional attachment other than you. You should write a structured proposal around the needs of the venture capitalist, not yours. What may interest you may not be relevant to your potential funder. You need an "investor focused" business plan.

An investor-focused business plan contains information relevant to your project. It addresses concerns and questions and should allay any concerns that any potential venture capitalist may have. It must meet their exact needs. Venture capitalists exist to make big profits. They want to see a good return on investment. By preparing an investor-focused business plan, it will be clear to the venture capitalists that you are focused, prepared and competent.

There are four areas that must be addressed:

management responsibility

Get to know your markets

Get to know your product

Learn how management, markets and products make money

management responsibility

The power of project management can make or break your proposal. Venture capitalists need to ensure that you can manage their money. They want to see a demonstrable track record in areas specific to your project. Management skills will be tested, so be well prepared.

Get to know your markets

Venture capitalists will need to know the source of your income. Your business must demonstrate a strong understanding of your customer base and be able to meet their needs. Your plan should also address any potential new or emerging markets. Point out any research you've done to confirm this.

Get to know your product

Venture capitalists want to fully understand your product. They want you to show how the product they are funding will attract customers. The information in this section should be comprehensive and also include any potential additions or upgrades that your product will include. This will show that you have thought about long-term growth.

Learn how management, markets and products make money

It must be demonstrated that management can create links and paths between customers and the product. This element must be very strong as ambiguous information, otherwise the supposed relationship will frighten any potential financier. Create a step-by-step guide on how their money is processed and how clients' money is received. This should be clearly stated.

Connect these dots together and you will already be in the top 3% of all venture capital submissions. Good luck and God bless you!

Get to know your markets Venture capitalists will need to know the source of your income. Get to know your product Venture capitalists want to fully understand your product. Learn how management, markets and products make money It must be demonstrated that management can create links and paths between customers and the product.

Raising capital for your the best business - how long does it take?

Raising capital for your business - how long does it take?

This time is devoted to conducting market research to investigate the opportunity, developing a comprehensive financial model, determining the most effective way to formulate a business strategy, and writing and correcting a business plan.

This process includes creating a list of key investors, visiting each investor's website to review investment criteria and past investments, and identifying the right contact person in the company.

Most companies greatly reduce the time required to complete financing. In fact, a company seeking financing must allocate between 500 and 1,000 working hours to the capital increase process, spread over a period of 6-9 months.

The main operations in the capital increase process include

1) master the business plan, submission of the memo and other due diligence materials to the company,

2) to develop a comprehensive and targeted list of potential investors,

3) contact this list and respond to investor due diligence requests, and

4) Negotiate the deal.

Completing a business plan typically requires at least 200 working hours. This time is devoted to conducting market research to investigate the opportunity, developing a comprehensive financial model, determining the most effective way to formulate a business strategy, and writing and correcting a business plan.

The next step, which is to develop a comprehensive, targeted list of potential investors, is also time consuming. There are thousands of potential investors, each with different tastes in the types of projects that interest them. Some invest by market segment (for example, healthcare versus telecom), stage (initial versus later), geography, or a combination of these. Many hours must be devoted to identifying the right investors for your business. This process includes creating a list of key investors, visiting each investor's website to review investment criteria and past investments, and identifying the right contact person in the company.

To see how easy it is to count time, keep in mind that only about 25% of potential investors who show an initial interest in a transaction actually move on to detailed business due diligence. Only about 10% of these 25% develop into a good money supply, of which only 25% actually result in an investment deal. So completing a financing deal requires, on average, networking with approximately 160 pre-qualified potential investors.

The due diligence process, where investors screen an investment, can be very time consuming for a company. Investors often require many documents, some of which can be easily retrieved from files (such as past tax returns) while others may take longer to prepare (such as additional market analysis, customer lists with previous purchases, contact information, etc.). Finally, it can take a long time to negotiate a transaction depending on the complexity of the transaction and the number of parties involved.

Many companies fail to raise capital because they do not realize how much time is required to do so. The companies that understand these requirements and budget accordingly are the ones most likely to continue to persevere and end up with the capital they need.

This process includes creating a list of key investors, visiting each investor's website to review investment criteria and past investments, and identifying the right contact person in the company. To see how easy it is to count time, keep in mind that only about 25% of potential investors who show an initial interest in a transaction actually move on to detailed business due diligence. The due diligence process, where investors screen an investment, can be very time consuming for a company.