Venture Capital Worldwide   

What is Venture Capital?
Venture Capital is an important source of financing for startup companies or others embarking on new or turnaround ventures that entail some investment risks but at the same time offers the potential for above average profits, also called risk capital. Sources of venture capital include wealthy individual investors, subsidiaries of banks and other corporate institutions as small business investment companies.

Venture Capitalist
A Venture Capitalist is a high net worth individual with available liquid assets or a firm incorporated for the purpose of investing in private companies. The infusion of capital is expected to take the private company to the point of qualifying to do an Initial Public Offering. Usually venture capitalists expect a high percentage of equity interest in the private companies in which they invest.

There is a general misconception about seeking venture capital. Securing venture capital funding has never been easy. The average entrepreneur spends more than a thousand man hours of frustration and disappointment searching for funding. More than nine out of ten never find the capital they seek Presently, finding the money necessary to help your business reach its full potential is even more difficult. Therefore emerging growth companies with little or no track record will find it much more difficult to get the attention of investors over well established companies. Funds are still available, however the terms and conditions will be more challenging and the right contacts are of vital importance. This is where we come in. We have the resources and the expertise. We will review your executive summary and financial projections free of cost. It is very difficult to match a client’s request to lenders conditions since the project’s financing requirements must conform to the type of financing, stage preferences, industry preferences and geographic preferences all at the same time. Make sure that you get professional help in preparing your Executive Summary and Financials. Some clients try to write their own plans, although there is nothing wrong with that if you have the  necessary experience, but investors look for certain criteria and if you do not know the criteria, then you are setting yourself up for failure and time wasting. This is a long process and because of the long man hours will require a retainer. However, after review if we choose to take on a project, we will require a signed non-circumvention and non-disclosure confidentiality agreement before proceeding.

Entrepreneurs seeking start up capital must have some "skin in the game" ie: must have their own injection of cash in their projects. The days of producing a business plan with zero equity are over. An Investor expects applicants to have equity in the form of cash in their projects, preferably 25% 35% but not less than 10%. Also the business plan must include a statement that defines what make the plan unique, a detailed discussion of key financial and operational drivers, resumes of key management, itemized use of funds statement, historical and projected financial statements focusing on performance rather than pro-forma, the market, competitive analyses, references and exit strategy.

Evaluation
These are some of the factors that we consider in our evaluation meetings:
Uniqueness: Does your product or service hold a unique position in its market that is sustainable?
Knowledge of competition: How well have you positioned your new venture against the position of other companies in its target market as well as position in relation to indirect competitors who could become a threat in the future, even if they are not today?
Quality of financial projections: How reasonable are the financial projections? How did you arrive at the valuations? What are the assumptions behind its revenue and expense projections?
Quality of sales and marketing plan: How reasonable is the sales and marketing plan? Is it well thought out?
Quality of the management team: Are key positions filled by qualified people in order to perform the required duties? Do these people have a track record of past success? Will there be any key positions left unfilled?
Nature of exit strategy: What is the venture's exit strategy? Is the goal a profitable sale should an appropriate offer is made? Is the goal an IPO? What exit time framed is planned?
Overall potential for success: How likely is the venture to succeed based on an assessment of a combination of the above factors?
Attributes: What marketing principles will be incorporated into the business? Will management recognize the changes going on in every phase of the business as a result and including internet marketing? How will it manage customer or client relationships? How will its product or service change to meet the needs of individual customers or clients and how can the company build learning relationships with its customers or clients?

Our Review
After the executive summary and financial projections have been reviewed, an associate is assigned the responsibility of preparing an in-depth critical analysis. This analysis is then presented to the executive at our evaluation meetings. At this time we may contact the applicant for more information. If our team can agree upon an economic basis for a potential investment, we will make presentations to those investors we feel will be a match for your project based on the type of financing, stage preferences, industry preferences and geographic preferences all of which must conform to the investor's guidelines. The investor will perform one or more comprehensive evaluations and schedule several meetings before making a commitment. At any time in our review process we may choose to proceed or not to proceed with a project. The acceptance of your plan does not obligate us in any way to present your project for funding. That is only determined after careful evaluation and a written fee and non-circumvention non-disclosure (NCND), confidentiality agreement has been duly executed by the principal or other authorized signatory.

We read and evaluate all Executive Summaries, financials included. Submit your plan today for a free evaluation.

Venture Capital Axiom
The Golden Rule. " He who has the gold makes the rules."

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