Venture Capital Process
Successful venture capital funding is a process of reducing perceived risk to the lowest possible level. The funding source has fiduciary responsibility to its investors. This requires a thorough " due diligence review " of all aspects of your business.
Venture capital sources will often require you to justify every assumption made for a projection five years into the future.
Your business plan must show the investment parameters requested, as well as a plan to liquidate the investor's position (the exit strategy ) at a later date by either a payback formula, initial public stock offering (IPO), or plans for a merger/buyout by a major company.
In the U.S., there are currently more than 6700 venture pools , private firms, SBIC's and corporate investors, with over $200 Billion under management. With the globalization of the economy, there is easily five times that much venture capital available from worldwide sources.
Even so, more than 80% of all start up companies are funded through informal sources such as friends, associates, and private "Angel" investors .
Seven Levels of Research and Planning for Every Startup:
Venture Capital Stages
Early Stage Financing: $25,000- $250,000
Expansion Financing: $500,000 - $5,000,000
Acquisition/Buyout Financing: $3,000,000 - $20,000,000
To Learn More about you can acquire a business with unique funding techniques and understand the financial techniques used by the pros, see our special reports.
goal is to provide you the best funding tools available and to get your
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"When we received first round funding ($5 million) the VC firm asked us to show them how our financial models were created. They wanted to use OUR TEMPLATE (which we developed from the 7 Venture Capital Reports) to help them evaluate alternative scenarios for their portfolio companies!" Michael .Lay, CFO, e-Commerce Internet Company
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