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What do venture capitalists look for in a business plan?
The concept seems simple.You need to develop a business plan.In this business plan you need to clearly explain your plan to be successful and make money.Detail is important, unless the venture capitalist can follow your logic and agrees with your philosophies, he is going to take his money elsewhere.Also, you need to make it abundantly clear that now only is your business going to be successful, but that your investors will be handsomely rewarded well above their initial capital investment.Be confident.Show your venture capitalists that you are the kind of person who makes things happen.They need to be confident that they are making the right choice not only in terms of the company but in its entrepreneur (that's you!)
Generically venture capitalists are looking to invest in a company that they are confident will yield them a return on that investment.But what more specifically are they looking for when you present to them your business plan?Here are a few tips of what venture capitalists look for in a business plan:
Remember that the venture capitalist world is very competitive.You need to do everything in your power to get an edge.Do not be shy about investigating your potential venture capitalist firms.Show interest in them.Make sure that you have researched your market well and are educated and well-informed.Make certain that your business plan is flawless (consulting firms will be happy to help you in these areas).Mistakes in accounting or research can leave your investor with a sour taste in his mouth.Editing your business plan for grammatical errors can not be stressed enough.Sloppiness in overlooking such errors can make the difference between a venture capitalist choosing to invest with you or someone else.Do not give your potential investors any reasons why investing capital in your business would not be in their own best interest.
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