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  • Raising Venture Capital for the Serious Entrepreneur Pt. 2

    Part two of the series shows budding or established business owners, how to take the next steps toward raising the types of financing to build a profitable – long-term enterprise.

    Part two of Dermot Berkery’s, Raising Capital for the Serious Entrepreneur, which shows budding or established business owners, how to take the next steps toward raising the types of financing to build a profitable – long-term enterprise.

    I have receive several comments from Upstart: Business and Management for 20-40 Year Old Professionals members, so this should fill-in some of what people have been asking.

    1.      There is no correlation between the amount of money raised the company’s success.

    2.      The first step for the early-stage investor is to disaggregate the different activities in the company that absorb capital – capital assets: product development costs: leadership and administration: working capital and sales ramp-up financing.

    3.      VC funds are usually set-up a 10 year horizon, which has been good for entering and exiting a portfolio of investments.

    4.      Include in business plan: potential for accelerated growth: achievable position of market power (position to be exploited), differentiation: capable, ambitious and trustworthy management: value enhancing stepping-stones: realistic valuation: promising exit possibilities.

    5.      Three criteria for every tech VC: fast growth, high gross margins and low capital intensity.

    6.      Merger or acquisition valuation: importance of product to other companies: differentiation between the company’s product and competition: demand tension from potential acquirers – a problem solved.

    Good luck.

    Calvin Wilson
    Founder and CEO
    Upstart: Business and Management for 20-40 Year Old Professionals
    calvin.wilson1@verizon.net
    http://twitter.com/Upstart__Nation

    Filed Under: Startup/Entrepreneur

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