what are the steps to get venture capital it’s a question that came in
capital it’s a question that came in
capital it’s a question that came in from a YouTube viewer I are born or
from a YouTube viewer I are born or
from a YouTube viewer I are born or anger 89 or airborne or anger 89 having
anger 89 or airborne or anger 89 having
anger 89 or airborne or anger 89 having the hard name anyway wrote in I want to
the hard name anyway wrote in I want to
the hard name anyway wrote in I want to get venture capital how does it work
get venture capital how does it work
get venture capital how does it work what I mean to ask is what are the steps
what I mean to ask is what are the steps
what I mean to ask is what are the steps from finding one to closing the deal so
from finding one to closing the deal so
from finding one to closing the deal so I used to be in the VC business here it
I used to be in the VC business here it
I used to be in the VC business here it is this is how you do it this is the
is this is how you do it this is the
is this is how you do it this is the process that you have to go through and
process that you have to go through and
process that you have to go through and hopefully you get some advice here that
hopefully you get some advice here that
hopefully you get some advice here that can help you actually go and land the
can help you actually go and land the
can help you actually go and land the deal okay
deal okay
deal okay most businesses never make it they’ll
most businesses never make it they’ll
most businesses never make it they’ll get rejected by VCS mostly without even
get rejected by VCS mostly without even
get rejected by VCS mostly without even a response so here’s the process it
a response so here’s the process it
a response so here’s the process it usually starts with connecting with a VC
usually starts with connecting with a VC
usually starts with connecting with a VC okay now BCS typically have targeted
okay now BCS typically have targeted
okay now BCS typically have targeted funds okay they look at specific
funds okay they look at specific
funds okay they look at specific industries and they create a fund around
industries and they create a fund around
industries and they create a fund around it so when you are researching your VCS
it so when you are researching your VCS
it so when you are researching your VCS you can go online you can find out all
you can go online you can find out all
you can go online you can find out all the different venture capitals out there
the different venture capitals out there
the different venture capitals out there you can see who’s recently raised to
you can see who’s recently raised to
you can see who’s recently raised to find do they have money if they don’t
find do they have money if they don’t
find do they have money if they don’t have any open money then you can make a
have any open money then you can make a
have any open money then you can make a connection but they’re not going to
connection but they’re not going to
connection but they’re not going to invest in you so focus on the ones that
invest in you so focus on the ones that
invest in you so focus on the ones that have money next see if they have an
have money next see if they have an
have money next see if they have an interest in your industry VCS want to
interest in your industry VCS want to
interest in your industry VCS want to see rapid growth they want to see at
see rapid growth they want to see at
see rapid growth they want to see at least 30% a year return on their
least 30% a year return on their
least 30% a year return on their investment not in the first year but
investment not in the first year but
investment not in the first year but compounded for when they exit and they
compounded for when they exit and they
compounded for when they exit and they want to be able to get out of your
want to be able to get out of your
want to be able to get out of your business in five years so that’s being
business in five years so that’s being
business in five years so that’s being acquired that’s going IPO that’s
acquired that’s going IPO that’s
acquired that’s going IPO that’s management buyout whatever it is so you
management buyout whatever it is so you
management buyout whatever it is so you have to have a business that can throw
have to have a business that can throw
have to have a business that can throw out those kinds of returns so it’s
out those kinds of returns so it’s
out those kinds of returns so it’s typically something like software or
typically something like software or
typically something like software or technology
technology
technology if you can’t ramp up fast enough and
if you can’t ramp up fast enough and
if you can’t ramp up fast enough and something you don’t have a great
something you don’t have a great
something you don’t have a great business it’s just not a great business
business it’s just not a great business
business it’s just not a great business for venture capitalist so this is also
for venture capitalist so this is also
for venture capitalist so this is also part of a research phase I haven’t even
part of a research phase I haven’t even
part of a research phase I haven’t even gone and contacted them yet the last
gone and contacted them yet the last
gone and contacted them yet the last thing I would do is look at do they have
thing I would do is look at do they have
thing I would do is look at do they have any portfolio companies already who you
any portfolio companies already who you
any portfolio companies already who you can help so have they already invested
can help so have they already invested
can help so have they already invested money into a business into a different
money into a business into a different
money into a business into a different startup that you can give some advice
startup that you can give some advice
startup that you can give some advice and Momentum’s and guidance some help
and Momentum’s and guidance some help
and Momentum’s and guidance some help with somehow if the portfolio companies
with somehow if the portfolio companies
with somehow if the portfolio companies can work together then you’re not just
can work together then you’re not just
can work together then you’re not just bringing an investment opportunity to
bringing an investment opportunity to
bringing an investment opportunity to them you’re bringing a new partnership
them you’re bringing a new partnership
them you’re bringing a new partnership that can already help someone they’ve
that can already help someone they’ve
that can already help someone they’ve already put money into so you’re
already put money into so you’re
already put money into so you’re bringing more to the table okay once you
bringing more to the table okay once you
bringing more to the table okay once you found these different VCS the next tip
found these different VCS the next tip
found these different VCS the next tip is to reach out and contact them and
is to reach out and contact them and
is to reach out and contact them and that’s pretty easy they all have an
that’s pretty easy they all have an
that’s pretty easy they all have an email or phone number that you can dial
email or phone number that you can dial
email or phone number that you can dial into you can send them a message you can
into you can send them a message you can
into you can send them a message you can find out who the VC is you can see who’s
find out who the VC is you can see who’s
find out who the VC is you can see who’s accepting the business plans and send it
accepting the business plans and send it
accepting the business plans and send it off to them the most important thing the
off to them the most important thing the
off to them the most important thing the VC is going to look at and this was me I
VC is going to look at and this was me I
VC is going to look at and this was me I was on I was on the screening side of
was on I was on the screening side of
was on I was on the screening side of things I was seeing all the deals that
things I was seeing all the deals that
things I was seeing all the deals that were coming in and you had to get
were coming in and you had to get
were coming in and you had to get through me before you got to talk to the
through me before you got to talk to the
through me before you got to talk to the people who are going to raise the money
people who are going to raise the money
people who are going to raise the money you have to have an executive summary
you have to have an executive summary
you have to have an executive summary that makes sense
that makes sense
that makes sense think about two pages it defines
think about two pages it defines
think about two pages it defines everything in your business plan that
everything in your business plan that
everything in your business plan that has to make sense it has to be written
has to make sense it has to be written
has to make sense it has to be written in plain English what we had an industry
in plain English what we had an industry
in plain English what we had an industry term we use was the grandmother test it
term we use was the grandmother test it
term we use was the grandmother test it has to pass a grandmother test your
has to pass a grandmother test your
has to pass a grandmother test your executive summary has to be something
executive summary has to be something
executive summary has to be something that you could show your grandmother or
that you could show your grandmother or
that you could show your grandmother or somebody who knows nothing about your
somebody who knows nothing about your
somebody who knows nothing about your business and they could read it and
business and they could read it and
business and they could read it and understand it so as to be in plain
understand it so as to be in plain
understand it so as to be in plain English has to not be filled with jargon
English has to not be filled with jargon
English has to not be filled with jargon and it has to just make plain common
and it has to just make plain common
and it has to just make plain common sense and a lot of companies when they
sense and a lot of companies when they
sense and a lot of companies when they write their executive summary even their
write their executive summary even their
write their executive summary even their whole business plan it’s so technical so
whole business plan it’s so technical so
whole business plan it’s so technical so filled with jargon that when they read
filled with jargon that when they read
filled with jargon that when they read it it makes sense because that’s the
it it makes sense because that’s the
it it makes sense because that’s the world you live in but remember VCS
world you live in but remember VCS
world you live in but remember VCS they’re generalists they’re not
they’re generalists they’re not
they’re generalists they’re not specialists on a specific product like
specialists on a specific product like
specialists on a specific product like you are so you have to make it make
you are so you have to make it make
you are so you have to make it make sense for them if they can understand it
sense for them if they can understand it
sense for them if they can understand it they’re gone so show other people your
they’re gone so show other people your
they’re gone so show other people your executive summary and your business plan
executive summary and your business plan
executive summary and your business plan make sure it makes sense that’s the
make sure it makes sense that’s the
make sure it makes sense that’s the first thing I look at okay if your
first thing I look at okay if your
first thing I look at okay if your executive summary is not a winner it’s
executive summary is not a winner it’s
executive summary is not a winner it’s gone
gone
gone delete trash can it’s gone maybe not
delete trash can it’s gone maybe not
delete trash can it’s gone maybe not even response if they like it they’re
even response if they like it they’re
even response if they like it they’re going to dig deeper the next thing going
going to dig deeper the next thing going
going to dig deeper the next thing going to look at is your team
to look at is your team
to look at is your team the agency has this guide done it before
the agency has this guide done it before
the agency has this guide done it before is there any startup experience at all
is there any startup experience at all
is there any startup experience at all here the term when the VC world is is
here the term when the VC world is is
here the term when the VC world is is this the horse for the course and so you
this the horse for the course and so you
this the horse for the course and so you want to build as much momentum as you
want to build as much momentum as you
want to build as much momentum as you can here if you’ve never had an
can here if you’ve never had an
can here if you’ve never had an experience building a startup try to get
experience building a startup try to get
experience building a startup try to get people on your board try to create a
people on your board try to create a
people on your board try to create a Board of Advisors not a Board of
Board of Advisors not a Board of
Board of Advisors not a Board of Directors which has more legal
Directors which has more legal
Directors which has more legal implications but an advisory team get
implications but an advisory team get
implications but an advisory team get people who can lend their name to the
people who can lend their name to the
people who can lend their name to the project even if
project even if
project even if not actively involved in the business
not actively involved in the business
not actively involved in the business show that you’re not just a one-man show
show that you’re not just a one-man show
show that you’re not just a one-man show or a couple man show get people who’ve
or a couple man show get people who’ve
or a couple man show get people who’ve had some experience on your advisory
had some experience on your advisory
had some experience on your advisory board and the Weiser board is a loose
board and the Weiser board is a loose
board and the Weiser board is a loose term it’s just really getting somebody
term it’s just really getting somebody
term it’s just really getting somebody who will lend their name to the project
who will lend their name to the project
who will lend their name to the project and say hey I believe in these guys and
and say hey I believe in these guys and
and say hey I believe in these guys and I’m going to help them out the next
I’m going to help them out the next
I’m going to help them out the next thing I look at is your financials first
thing I look at is your financials first
thing I look at is your financials first do you have any revenue if you have
do you have any revenue if you have
do you have any revenue if you have revenue you’re already separated from
revenue you’re already separated from
revenue you’re already separated from ninety nine percent of the people who
ninety nine percent of the people who
ninety nine percent of the people who apply most people just come with an idea
apply most people just come with an idea
apply most people just come with an idea if you can have something that has some
if you can have something that has some
if you can have something that has some revenue you’re way ahead of everybody
revenue you’re way ahead of everybody
revenue you’re way ahead of everybody else and they’re not expecting you to be
else and they’re not expecting you to be
else and they’re not expecting you to be huge that’s why you’re coming to them
huge that’s why you’re coming to them
huge that’s why you’re coming to them that’s why you need money the easiest
that’s why you need money the easiest
that’s why you need money the easiest money to raise though is expansion
money to raise though is expansion
money to raise though is expansion capital you figured out how something
capital you figured out how something
capital you figured out how something works and there’s a demand for it and
works and there’s a demand for it and
works and there’s a demand for it and now you’re ready to blow it up and you
now you’re ready to blow it up and you
now you’re ready to blow it up and you need money to help do it so get some
need money to help do it so get some
need money to help do it so get some revenue get some momentum as much as you
revenue get some momentum as much as you
revenue get some momentum as much as you can I know it’s hard at the start and
can I know it’s hard at the start and
can I know it’s hard at the start and it’s not going to be glamorous to say
it’s not going to be glamorous to say
it’s not going to be glamorous to say hey I have $10,000 in sales but that’s
hey I have $10,000 in sales but that’s
hey I have $10,000 in sales but that’s 10,000 more than most people so you’re
10,000 more than most people so you’re
10,000 more than most people so you’re already ahead of the game and the more
already ahead of the game and the more
already ahead of the game and the more money you have coming in the better it
money you have coming in the better it
money you have coming in the better it is they’re not expecting you to have it
is they’re not expecting you to have it
is they’re not expecting you to have it all figured out but shows some momentum
all figured out but shows some momentum
all figured out but shows some momentum and then they’re gonna look at your
and then they’re gonna look at your
and then they’re gonna look at your projections can you throw off enough of
projections can you throw off enough of
projections can you throw off enough of a return that they can make money do you
a return that they can make money do you
a return that they can make money do you have enough growth potential in your
have enough growth potential in your
have enough growth potential in your business if if it’s a great you know
business if if it’s a great you know
business if if it’s a great you know profitable company idea but it’s not
profitable company idea but it’s not
profitable company idea but it’s not going to grow at least 30% a year return
going to grow at least 30% a year return
going to grow at least 30% a year return for the investor then they’re not going
for the investor then they’re not going
for the investor then they’re not going to be interested and then they’re going
to be interested and then they’re going
to be interested and then they’re going to look at the rest of the plan so it
to look at the rest of the plan so it
to look at the rest of the plan so it starts with the executive summary then
starts with the executive summary then
starts with the executive summary then the management team then the financials
the management team then the financials
the management team then the financials and then the rest of the plan very
and then the rest of the plan very
and then the rest of the plan very detailed hopefully this is helping you
detailed hopefully this is helping you
detailed hopefully this is helping you the next thing is if they like you
the next thing is if they like you
the next thing is if they like you they’re going to call you in for a
they’re going to call you in for a
they’re going to call you in for a meeting you’re going to come in for a
meeting you’re going to come in for a
meeting you’re going to come in for a meeting they’re going to just scope you
meeting they’re going to just scope you
meeting they’re going to just scope you out you know you’ve written a great
out you know you’ve written a great
out you know you’ve written a great thing on paper and now they want to see
thing on paper and now they want to see
thing on paper and now they want to see who the person is who’s presenting this
who the person is who’s presenting this
who the person is who’s presenting this idea and they’re going to challenge you
idea and they’re going to challenge you
idea and they’re going to challenge you on your business plan and they’re going
on your business plan and they’re going
on your business plan and they’re going to challenge you on your financials and
to challenge you on your financials and
to challenge you on your financials and you better have an answer for everything
you better have an answer for everything
you better have an answer for everything every number in your financial statement
every number in your financial statement
every number in your financial statement you have to have a reason for and I know
you have to have a reason for and I know
you have to have a reason for and I know a lot of it you’re you’re picking out of
a lot of it you’re you’re picking out of
a lot of it you’re you’re picking out of the air but you have to be able to back
the air but you have to be able to back
the air but you have to be able to back it up where you’re spending the money
it up where you’re spending the money
it up where you’re spending the money to be clearly defined how much do you
to be clearly defined how much do you
to be clearly defined how much do you need and where is it going – and why do
need and where is it going – and why do
need and where is it going – and why do you need to spend this much money on
you need to spend this much money on
you need to spend this much money on this initiative you have to have solid
this initiative you have to have solid
this initiative you have to have solid answers to that
answers to that
answers to that if you waver you’re not going to get the
if you waver you’re not going to get the
if you waver you’re not going to get the money they’re not going to think you
money they’re not going to think you
money they’re not going to think you have the confidence to build this thing
have the confidence to build this thing
have the confidence to build this thing up so practice drill it be able to
up so practice drill it be able to
up so practice drill it be able to explain every single number every line
explain every single number every line
explain every single number every line in your executive summary in your
in your executive summary in your
in your executive summary in your business plan you have an answer for
business plan you have an answer for
business plan you have an answer for practice practice practice and that will
practice practice practice and that will
practice practice practice and that will help you win the pitch if they like you
help you win the pitch if they like you
help you win the pitch if they like you so that first meeting goes well the next
so that first meeting goes well the next
so that first meeting goes well the next thing we’re going to talk about is
thing we’re going to talk about is
thing we’re going to talk about is evaluation now that should already
evaluation now that should already
evaluation now that should already either be in your business plan or you
either be in your business plan or you
either be in your business plan or you have a clearer sense of what it’s going
have a clearer sense of what it’s going
have a clearer sense of what it’s going to be because if they don’t like your
to be because if they don’t like your
to be because if they don’t like your valuation then they’re not going to find
valuation then they’re not going to find
valuation then they’re not going to find you before the waste any more time they
you before the waste any more time they
you before the waste any more time they have to know how much it is that you
have to know how much it is that you
have to know how much it is that you want and how much of the company they’re
want and how much of the company they’re
want and how much of the company they’re going to get for I know what your bottom
going to get for I know what your bottom
going to get for I know what your bottom line number is you know what you are
line number is you know what you are
line number is you know what you are willing to accept and what you are not
willing to accept and what you are not
willing to accept and what you are not willing to accept what you’re going to
willing to accept what you’re going to
willing to accept what you’re going to walk away from if you can agree on that
walk away from if you can agree on that
walk away from if you can agree on that all of that they like evaluation they
all of that they like evaluation they
all of that they like evaluation they like your plan they like your meeting
like your plan they like your meeting
like your plan they like your meeting you all of that’s going really well the
you all of that’s going really well the
you all of that’s going really well the next thing you’re going to do is do
next thing you’re going to do is do
next thing you’re going to do is do diligence and this is usually a couple
diligence and this is usually a couple
diligence and this is usually a couple weeks building it they’re going to dive
weeks building it they’re going to dive
weeks building it they’re going to dive deeper into your business they’re going
deeper into your business they’re going
deeper into your business they’re going to learn more about your industry learn
to learn more about your industry learn
to learn more about your industry learn about your competition they will ask for
about your competition they will ask for
about your competition they will ask for more records and information for your
more records and information for your
more records and information for your company if you have an office they’re
company if you have an office they’re
company if you have an office they’re going to want to see it you have a team
going to want to see it you have a team
going to want to see it you have a team they’re going to meet them they’re going
they’re going to meet them they’re going
they’re going to meet them they’re going to dive as deep as they can to get to
to dive as deep as they can to get to
to dive as deep as they can to get to know your business if all that goes well
know your business if all that goes well
know your business if all that goes well then they’re going to think about what
then they’re going to think about what
then they’re going to think about what are the holes that you need to make this
are the holes that you need to make this
are the holes that you need to make this thing really take off so for example you
thing really take off so for example you
thing really take off so for example you might not be the best CEO for this
might not be the best CEO for this
might not be the best CEO for this business you know if you have some
business you know if you have some
business you know if you have some software company maybe your best place
software company maybe your best place
software company maybe your best place is going to be leading the tech team but
is going to be leading the tech team but
is going to be leading the tech team but not actually growing it as the CEO that
not actually growing it as the CEO that
not actually growing it as the CEO that might be the advice that comes back and
might be the advice that comes back and
might be the advice that comes back and that might be a deal breaker are you
that might be a deal breaker are you
that might be a deal breaker are you willing to step out of your role as CEO
willing to step out of your role as CEO
willing to step out of your role as CEO for somebody who’s actually built up a
for somebody who’s actually built up a
for somebody who’s actually built up a software company before and take it to
software company before and take it to
software company before and take it to the next level they’re going to come up
the next level they’re going to come up
the next level they’re going to come up with a list of suggestions to help you
with a list of suggestions to help you
with a list of suggestions to help you grow your business this is how they see
grow your business this is how they see
grow your business this is how they see it growing they’re going to give you X
it growing they’re going to give you X
it growing they’re going to give you X amount of dollars and you’d like to see
amount of dollars and you’d like to see
amount of dollars and you’d like to see these changes made some will be now and
these changes made some will be now and
these changes made some will be now and some of
some of
some of in the future but this is their
in the future but this is their
in the future but this is their direction you have to be on the same
direction you have to be on the same
direction you have to be on the same same page
same page
same page you have to believe in that same vision
you have to believe in that same vision
you have to believe in that same vision with them if everything is good if you
with them if everything is good if you
with them if everything is good if you agree they’re going to give you a term
agree they’re going to give you a term
agree they’re going to give you a term sheet they’re going to say this is how
sheet they’re going to say this is how
sheet they’re going to say this is how much money we’re going to invest this is
much money we’re going to invest this is
much money we’re going to invest this is evaluation and you’re going to have a
evaluation and you’re going to have a
evaluation and you’re going to have a limited amount of time very short to
limited amount of time very short to
limited amount of time very short to make a decision yes or no because what
make a decision yes or no because what
make a decision yes or no because what they don’t want to happen is you shot
they don’t want to happen is you shot
they don’t want to happen is you shot the deal so you get a term sheet from
the deal so you get a term sheet from
the deal so you get a term sheet from one VC and then go to another one and
one VC and then go to another one and
one VC and then go to another one and say hey this VC gave me this deal so you
say hey this VC gave me this deal so you
say hey this VC gave me this deal so you can you do better so you have a really
can you do better so you have a really
can you do better so you have a really small window to make a decision and then
small window to make a decision and then
small window to make a decision and then from there you say yes the one that you
from there you say yes the one that you
from there you say yes the one that you like and you go forward so that’s kind
like and you go forward so that’s kind
like and you go forward so that’s kind of a twosie of how to raise money from a
of a twosie of how to raise money from a
of a twosie of how to raise money from a venture capitalist
venture capitalist
venture capitalist the biggest challenge typically is right
the biggest challenge typically is right
the biggest challenge typically is right up front because 99% of business plans
up front because 99% of business plans
up front because 99% of business plans don’t get pulled in for that first
don’t get pulled in for that first
don’t get pulled in for that first meeting so really do a good job with
meeting so really do a good job with
meeting so really do a good job with your executive summary with your
your executive summary with your
your executive summary with your business plan
business plan
business plan the management BIOS the team you’ve
the management BIOS the team you’ve
the management BIOS the team you’ve built and the the financials and
built and the the financials and
built and the the financials and hopefully some revenue momentum and now
hopefully some revenue momentum and now
hopefully some revenue momentum and now give you your best chance of getting
give you your best chance of getting
give you your best chance of getting that first meeting and then it’s up to
that first meeting and then it’s up to
that first meeting and then it’s up to you to seal the deal if you have any
you to seal the deal if you have any
you to seal the deal if you have any more questions about it leave it in
more questions about it leave it in
more questions about it leave it in below leave in the comments and happy to
below leave in the comments and happy to
below leave in the comments and happy to walk you through it that’s kind of a
walk you through it that’s kind of a
walk you through it that’s kind of a high-level overview of the whole process
high-level overview of the whole process
high-level overview of the whole process in a couple minutes for those are you
in a couple minutes for those are you
in a couple minutes for those are you watching like the video thumbs up below
watching like the video thumbs up below
watching like the video thumbs up below I’ll do more for you and I want to hear
I’ll do more for you and I want to hear
I’ll do more for you and I want to hear we have to think leave a comment
we have to think leave a comment
we have to think leave a comment underneath let me know you have a
underneath let me know you have a
underneath let me know you have a question leave it below make a video
question leave it below make a video
question leave it below make a video response for you guys thank you so much
response for you guys thank you so much
response for you guys thank you so much and I’ll see you soon
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