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How to raise money for your business? by Mind Map: How to raise money
for your business?
4.8 stars - 5 reviews range from 0 to 5

How to raise money for your business?

based on several sources gate2growth Prof. Faltin VCs

fundamental 4 from investor view

Do I like and understand the business concept and model?

Can I make money on this investment?

Do I believe in all the info in the Investment Summary and the business plan?

Do I trust that the management can deliver?

funding process

on average it takes 6 - 12 months

adjusting misconceptions/managing expectations

you should be ready for a due diligence when you start

aligning business model to type of investor search

taste of investor

qualifications/experience of entrepreneur

adressing technical/commercial risks

getting entrepreneur investor ready

diagnosis

business plan

executive summary

investment summary, short description of investment opportunity, why investor can make money, capital requirement, purpose of funding, timing of exit, general infos

presentation (see below)

establishing valuation levels

1 or more rounds. Scenario A: small funding, fast milestones preparing a leap frog round. Scenario B: big round.

shares

factors for price tag

finding suitable investors

several capital infusions with valuation and exit opportunities syndication (creates security for the investor)

if needed: structuring an investor consortium

securing investor-friendly presos

Every preso should be catered to the individual investor (prepare background info like do the syndicated deals, which sectors, exits ...) preso based on business plan with in-depth insights  

USPs

IPR

competitive position see USPs

competitors

market

business model + sales & marketing strategy

managements background, organizational development - team

financial goals, cost structure ...

milestones, roadmap

outline of exit straegies

milestones plus budget

term sheet drafting

non-legally-binding terms before due dilligence. Contents goes into shareholder agreement company should have the lead in order to influence the final agreement (SA).

milestones

where to put the money

exits

due diligence process

  checking of business plan stressful reaction of management is crucial (part of the game) can last months  

negotiations with investor

save some cash for alternatives in order to not be trapped

closing - shareholder agreement (SA)

legally binding involve lawyer

parties involved

objectives of the agreement

share capital of company and distribution incl. schemes

articles of association and by laws of compan

board of directors, advisory board, director's rules

management of the company

audits and accounts

shareholder meeting

dividend policy

share transactions

breaches of SA

competition clauses

secrecy clauses

voting rights of shares

endorsement of share certificates and escrow account

start and termination of SA

expenses

arbitration and governing law

bizPlan

business model needs to answer

USP in the market

protection against copycats

protect against technological obsolescence

protect against revenue creation obsolescence

marketing as integral part of bizplan

lean on finance

scalability, simplicity vs. complexity

riskmanagement

answer precisely

How much will it cost you to acquire a user?

How will you convert him to a paying customer?

How much will you make off him while he is paying you?

What do you estimate churn at and how do you up retention?

formal

provide roadmap

value proposition

financials

deal structure

marketing strategy

valuation

exit strategy

Some personal experience from working in startups for more then a decade

Really important in front of business angels

You sell yourself as an entrepreneur

passion

integrity

leadership

learnability

general rule of thumb: 5% of business plans are read beyond executive summary. 0,05% get funded