Venture Capital Investors Will Want You To Follow This TIP: A Team, An Idea, And A Plan
Entrepreneurs who want to obtain financing for their business will have to start with an excellent business idea to convince their investors to obtain financing for them.
You should not focus on just one aspect. Entrepreneurs need to understand what investors really want, especially if you like venture capitalism. Here’s a TIP for you: you need to have a TEAM, an IDEA, and a business PLAN.
1. Your TEAM.
The best business ideas come from a team that can execute the plan and update the goals. You can have greater power of persuasion if you have a talented, experienced and experienced team rather than being a lone entrepreneur.
You should also consider that your team members have some form of financial commitment. In other words, you should consider family and friends as your first investment proposition. Investors simply want to know that when the hot and steamy stuff hits the fan, each team member has more to lose than just their time and energy.
2. The IDEA.
Venture capitalists seek a safe return on their investment that is substantial enough to make up for the many other losing companies they will back. Venture capitalism carries a high risk of failure, especially for startups, and they want to hear a business idea that screams significant growth potential.
You might want to ask yourself, is your business idea big enough? Can your idea be turned into a franchise? Or, can your idea last long enough to be a license? Can you find ancillary products or strategic partnerships for your new product idea?
3. Your business PLAN.
Entrepreneurs must be able to make a detailed and fluent presentation of how IDEA will become a business opportunity worthy of investment. Design a clear strategy for how you and your TEAM will update your current strategy. Make sure to demonstrate your knowledge and skills in the market.
Always remember that you don’t have to be in venture capitalism alone. You can start by contacting the investor directly and asking what they want to see. They can give you invaluable recommendations during your initial meeting.
You also have friends, family, fellow entrepreneurs, and mentors who would be willing to listen, advise, and provide feedback as you gather your TEAM, develop the IDEA, and formulate the PLAN.
These people and the TIP can help you decide whether to push or pass on the investment. You will have the opportunity to hone your approach and be ready to finally deliver your speech.