3.1 Show Your Investment Potential - Introduction
You know how much money you need, you know how you'll use it, and you've
got an idea of the types of investors who might be interested. But how
do you make your company and your growth plan attractive to risk capital
investors? After all, they're looking for ways to invest their money
intelligently and profitably; why should they invest it in your business?
We'll help you to demonstrate your investment potential and attract
those investors.
In this Step, you'll learn how to demonstrate and measure your company's
potential for growth. You have to prepare to meet the needs and expectations
of risk capital investors. We'll help you look at your business from
their point of view, and analyse its strengths and weaknesses. And,
you must be prepared to demonstrate that your company is a good risk.
We'll show you what kinds of information to gather to prove your point.
A critical part of this Step is putting a value or price on your business.
You will be introduced to various techniques used to value businesses,
and you will learn how to address the investor's "exit strategy"
and "exit value" in your proposal.
In This Step
You'll learn how to assess your company, internally and externally,
with business valuation methods.
If you need a deeper understanding of the material, be sure
to follow the links within each section for a more detailed
explanation of how to assess and improve your company's management.
The New Tech Story
Follow the fictional company
New Tech Distributors Corp. (New Tech) as it pursues venture
financing. This case example gives you a feeling for the "real"
data and strategic decisions you'll be facing. You can always
get to it through the link on the left menu bar.
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