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| Business Plan/Raising Capital Checklist |
| The Road to Raising Capital (PDF file, 10K) |
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| Step |
- Define Stage of Business and Financing Needed:
- Seed (prove concept)
- Research and development (prototype development)
- Start-up (completion of product development, early marketing)
- First stage (initiate full-scale manufacturing and sales)
- Second stage (capital for expansion, generating revenue)
- Mezzanine (further expansion, business usually profitable 1 – 2 years)
- Specialty:
- Bridge (convertible debt, carry company to “next” stage)
- Acquisition (finances acquisition of another company)
- Turn-around (finances recovery from problem period)
- Develop information for all sections of Business Plan:
- Management and Organization
- Product/Service Plan
- Marketing Plan
- Financial Plan
- Operating System
- Growth Plan
- Supporting Appendices
- Management biographies
- Product information
- Market research
- Patents
- Documents to support validity of Business Plan
- Write Business Plan (See Business Plan Outline)
- Market driven
- Emphasize management strength
- Clear financial story and explicit investor “deal”
- Present attractive projections, returns and exit strategy
- Qualify the competition
- Market distribution plan
- Exploit company's uniqueness
- Zero in on possible funding sources
- Decide on Investor Target(s):
- Public investing (“going public” through sale of stock in public markets)
- Venture capital (early stage private investments by institutional and individual investors in managed funds)
- Angels (private investors who may act individually or in groups to invest in interesting companies)
- Investment bankers (institutions that will invest equity in emerging companies, frequently arms of brokerage houses)
- Commercial lenders (usually local banks that will provide asset-based lending)
- Trade partners (strategic allies that have a business interest in success of company)
- Prepare Executive Summary (optional) and “Roadshow” Presentation
- Prepare “Presenter”
- 30 second “elevator pitch”
- 3 minute “cocktail pitch”
- Boardroom presentation (see #5)
- Solicit Funding
- Cast a wide net!
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