Errors Which Can Prevent Receiving The Venture Funding

Venture capitalist Brad Feld has seen a large quantity of the businessmen wishing to receive financing for the project. They made set of different errors. Sometimes insignificant and sometimes such which simply crossed out all their hopes of reception of money. If you want to receive financing of your project try to avoid the following errors.

So, errors which are made by the businessmen, wishing to receive investments:

1) Audience Ignorance. Brad Feld invested in considerable quantity of software and the Internet companies. But he continues to be surprised and to this day when to him come to put up with the request money in the telecommunication company, the biotechnical company or the representative of retail. Businessmen should propose those ideas to that venture capitalist who is really interested in that market on which they work.

2) Business plan sending on 74 pages by mail (usual or electronic). Probably, in 1972 set in motion it would be justified, but today it is necessary to be limited with short email to the message in which it is necessary to present shortly the information on your company and the project. Probably, it is necessary to enclose there executive summary no more than 4 pages. All the matter is in that the investor does not possess superfluous time to get acquainted with your business plan. The idea should really interest to him, and then he will tell what to do further.

3) Don’t dispatch in large quantities your offers. It is not necessary to try to dispatch hundreds venture capitalists the identical depersonalized email-message. It is bad practice. Each letter should be personalized. Otherwise your chances to interest the investor sharply decrease.

4) You have the big list of advisers, but only one partner. It is not necessary to take a great number of advisers in the company. The long list is occupied usually with those people who will bring small advantage of the company.

5) You think that there is a universal approach to each venture capitalist. It is not so. Each investor is special. And to him the individual approach is necessary. Stake what really interests the given venture investor.

6) Too big business plan. The more (on volume of pages) you do the business plan there isless probability of that you really receive financing (however, no means always). Many people send the plans to investors. And studying of each such plan demands a fair share of time. Sometimes the big business plans so tire that their composers practically have no chances of financing reception.

7) It is not necessary to include in the business plan and in your presentation a considerable quantity of specialized terms, a professional slang and other that will be not clear to the investor. It is better to make for such materials separate section in the appendix if they are really necessary.

It is very reasonable that government, despite this crisis is not leaving to help small businesses. And small business grants can be a real helper right now.

But, surely, you should remember that today the fight for small business grants as well as for other kinds of grants is more fierce. This is natural – more businesses need them. So before you start your fight for the small business grants, please check out this blog for more helpful tips about grant industry.

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