How To Impress Venture Capitalists With More Than Just Your Business Plan
Of the roughly 6 million startups that form in the U.S. every year, only 8,076 of these are funded through true venture capital. This means that the investment satisfies all the characteristics of true venture capital and that all the blocks have been ticked. Those who are going to invest millions of dollars into a new venture will want to see more than just the product proposals and past performance, they will want to see things that directly affect their pockets.
They want to see the stats and figures
Instead of boring investors with slideshows that depict irrelevant information and fluffy sugar coatings of products and services, invest some time into the core figures of the business. Venture capitalists want to know the details such as revenues, cash flows, churn rates, and customer lifetime value. These are important numbers to have handy as it paints a picture for the investor in terms of the actual potential of the return and whether this would be magnified on a global scale.
Provide them with a potential partner
Apart from investing in the business, venture capitalists are also investing in their future partners and will want to see someone they can work with. This means swiping that credit card for a new suit and possibly even going for a haircut or whatever it requires to match the needs of the business and those of the future investor. They need to know that their money is in reliable hands and that the business owner has the potential to take the venture to the next level. Venture capital is never used by small businesses to remain small, it’s usually used by startups who have gained massive traction within a short space of time and have the potential for massive expansion. The owner should reflect this potential to set the investors at ease.
Invest in top talent
The last thing any venture capitalist wants to see is that a potential business investment makes use of employees that require constant supervision and lack the necessary skills to complete the task effectively. Expansion requires the owner to be hands-on in the running of the business which requires staff members to be able to perform their jobs without the owner having to step in all the time. Investing in the right staff has a direct impact on the bottom line of the business.
It takes more than just a product that sells well to meet the requirements of a venture capitalist. The business, its owners, and the staff should be able to handle massive growth with minimum effort in order to be attractive to future investors.