January 28, 2008

I love phone calls like that!

I just got off the phone with another one of the entrepreneurs that has successfully raised investment capital through FundingUniverse and, let me tell you, there is nothing better!  It’s so much fun to hear their unique story and hear about their learning experience.

With this company in particular, they participated in one of our SpeedPitching events last summer.  They met a significant group of investors that were interested in their plan, and were even invited to pitch in front of one of the angel groups.  After their pitch (to the angel group), they realized that they were not ready to move forward with an investor and went back to their preparations.  After about 6 months of working on their company, financial projections, and business plan… they are now back on the “fundraising trail.”  They have already raised a significant chunk of their total amount and will be pitching again in front of the same angel group within a month (to finish the round).

Anyway… if you want to make my day, give me a call at FundingUniverse headquarters to tell me your success story!

January 14, 2008

How many pages is your business plan?

I was at an event a few weeks ago and one of the entrepreneurs in attendance came bragging, “My business plan is nearly perfect; I have nearly 100 pages on my business plan.”

100 pages in a business plan!?

Wow.  Unless you have created the most technical advancement in aerospace of life sciences, I’m going to tell you to throw that 100 page document in the trash!  Let’s be honest, no investor is going to read a 100 page business plan.  In fact, they probably won’t read it if it is over 10 pages.

If you are going through the rigorous process of creating a business plan, here are a few suggestions (that have been validated by many investors):

  1. Keep it short.  Investors see hundreds of business plans and, no matter how great your plan is, they will not spend an hour trying to figure out what you do.  While there are exceptions to this rule, I’d recommend a 3-8 page business plan/executive summary.
  2. Don’t spend too much time on the product.  Remember that you are selling your company, not your product.
  3. Thing big.  Investors are looking for the next Google.  While $1-2M in revenue might be a large company to you, it’s probably not something that most investors are going to get excited about.
  4. Think from an investor’s perspective.  Do the economics make sense?  Make sure to evaluate the risk vs. reward balance.
  5. Don’t get too fancy.  Make sure that it is clean and presentable, but don’t try and make it too trendy.
  6. Use images and graphs — especially to explain difficult concepts.  They are usually easier to read and understand, which can only help.

January 10, 2008

FundingUniverse Featured in the Wall Street Journal

I just received that Google Alert about FundingUniverse being featured in an article in today’s Wall Street Journal.  The reporter had called me about 3-4 weeks ago, but you never know if the article will ever make it to print.

It’s exciting to see that they were able to talk to a few of the entrepreneurs that have been successful.  If you haven’t seen it, go check it out!