BACKING A NEW BUSINESS, VENTURE CAPITALISTS, BUSINESS ANGELS, WEALTHY ENTREPRENEURS
Backing a new business * venture capitalists * business angels * wealthy entrepreneurs * backing a new business * how to start a new company * how to succeed in business * richest entrepreneurs * launch new product * corporate success * business consultants * starting a new business * financial backing
If you are seeking backing for a new business venture, it is essential that you have the answers to the backers questions, have your facts right, know your product, market place and have a decent business plan. Don't make anything up if you don't know the answer, don't exaggerate and be honest about where you think you have weaknesses.
If you have a start up company, or you are about to start a new company, have a new business idea, product or service and entered this page through a search engine, go to the
start of this section about how to
start a new company
Having a good idea for a business, does not necessarily make a good business model. What may appear to be a brilliant idea to you may not have a big enough demand in the market place. Your idea may solve an irritating problem for example, but the public may not see it as a big enough problem to be motivated to buy. Alternatively, the market may be too small a niche market it to make the product or service a large enough profit generator for any Business Angel or Venture Capitalist to be interested in risking their money.
All too often, entrepreneurs get carried away with their own enthusiasm and motivation and lose sight of the real issues and goals. Simply blundering on with an idea because you think it is a real winner is not a good idea. Before you approach any backer for your new business idea or product you must have undertaken certain steps. Your backers will want answers and expect you to have them ready based on the following:
- Market research. You must find out if there is a genuine need or demand. This does not mean you ask friends, family or colleagues. There are inexpensive ways of dealing with this and we can help.
- Business plan. You need to know how big your market place is. Size and current spend and what percentage of the market you expect to capture. If you make any of this up, any experienced venture capitalist or business angel will see right through you. Production costs if any, staffing levels, overheads, financial projections, cash flow, turnover, gross and net profit all have to be realistic and achievable. You will need to show how. We can help.
- Prototypes. If you have a new product, you will need a fully tested working model. This does not have to look like the final product but you have to be able to demonstrate how your product will work. This is down to you.
- Patents. If you have a product make sure you have acquired the world-wide patents. No venture capitalist will invest in a product that can be quickly copied.
- Investment. You will need to know exactly the level of investment you need and demonstrate what you need it for and how it will be spent. No business angel is going to suddenly dump hundreds of thousands of pounds into your new company. They will drip feed your business as and when finance is required and only continue to support you if you are hitting targets. We can help.
- Equity shares. Expect to part with a substantial percentage share of your new business. All you have is an idea until the business is up and running and making a profit. You will need to negotiate from a position of strength to protect your own interests. We can help.
- Marketing/advertising. You will need to demonstrate that you have a marketing and advertising strategy in place. We can help.
Above all else, you must have your presentation off pat. Financial backers are backing you, not the product or service. If you are not convincing, if you do not exude confidence and if you don't have all the answers to hand, you will fall at the first hurdle. If you don't have the business acumen needed to make the company a success, you need to find business partners who can. We can help.
It is also important to understand that most new entrepreneurs who seek backing, don't actually need financial backing at all. Lack of business experience leads them to believe that they cannot get their company off the ground without financial investment. In fact, most businesses can become successful by importing business partners with the skills and experience and resources to provide everything needed for success.
Your business partners won't be expecting you to be the finished item. They will be looking for you to handle the areas where you have the expertise, whilst they provide the skills and experience that they have. It is a business partnership.
Unlike taking on financial backers who hold the whip hand whilst the new entrepreneur tries to do everything themselves, bringing in
partners who can be delegated tasks where they have the expertise, don't take any money until the business is profitable and can provide
support and mentoring is most likely the most profitable option and how to
succeed in business