10 Things Executives Need to Know When Looking for Capital

1)     Keep the business plan/executive summary short, concise and to the point

a)    When building your equity funding business plan do it right, do it right the first time.

2)     Don’t over shop your deal this creates what they call “hair on the deal.”

a)     When looking for money be careful who you allow to invest in your company.

b)     Carefully target your investors.

3)     Set the terms on the money upfront. In other words, know the true value of your company and base your offer proportionately.

a)     Learn how to properly valuate a company.

b)     Make sure you give your investors a deal/a reason to invest.

c)     Show the investors how their money will be protected.​

4)      Do not underestimate your capital needs​.

5)      Be totally and completely honest. One lie or stretch of the truth and it could be over​.

6)      Do not exaggerate or embellish facts, numbers, returns, etc.

7)      Make sure you understand securities law as it pertains to raising capital, inside and out or you might find yourself making license plates for a living.

8)      Have an attorney prepare the proper documents so you can legally raise money.

9)      Run an extremely tight ship. If the investors sense that their money will be squandered or spent inappropriately you will lose them​.

10)    Never attempt to start a business until you have thought it through from beginning to end. Consider how much money it will take, the market, your competition, technology, qualified management team, experience, etc. Starting a business will be the most difficult thing you have ever done, it will take everything you’ve got. You will have to make a lot of sacrifices and the odds of success are stacked up high against you. But if you succeed it’s worth every bit of  it.