Attracting Venture Capital For Your Business

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Acquiring funding or capital for your business can be very exhausting especially if you are new to the business industry. Your options may be using your life savings, applying for a bank loan, seeking funding from friends and family and finally acquiring venture capital funding. Venture capital is a form of funding where venture capital firms give funds to startups and emerging businesses who have the potential to excel in their businesses. In simpler terms, it’s a form of investment to new businesses that have demonstrated high or potential growth and profit. Venture capital funding for your business is one option you can consider to fund your retail business. Now are you wondering how you can get a venture capital funding?  How to attract them? It can be quite hectic to receive venture capital funding because venture capitalists investing in your business are literally investing their money at a risk of losing them because the venture is a new business.

These are a few ways you can attract venture capital for your business.

1.       A well defined business plan: This is the first point of attraction. If your business plan depicts a failed business to your prospective venture capitalists, forget to continue the rest of this article. Your business plan should depict a representational look of your company. It should highly hammer the strengths of the business and its model while pitching in a few weaknesses to arrive at a realistic picture. Every venture capitalist’s goal is to make profit and your business plan should satisfy that need. Do not forget to back your business plan with proof of its profitability.

2.       Ready market: The truth is venture capitalists don’t care how much you think your business idea is top notch. Do you have a ready market for the product or service you want them to invest in? To prevent you from fumbling on this question, do your research on the demand for your product, do a survey and get your feedback. If the feedback is good, then you go ahead. If not, try another product or service. Venture capitalists want to make profits and a product without a market has no chance of thriving. You will have a better case if your product or service can survive in the market.

3.       Innovative and Unique ideas : Venture capitalists are looking at unique and innovative ideas to put their money into. Their interest is if your product or service can be the solution to a new problem and also, they are looking for new ideas to invest in especially the ones that have repeatedly invested in very similar projects. Venture capitalists will jump at monopolistic business ideas because in that way they are assured of good returns on their investments. So the next time you are thinking of venture capital, think of a unique idea.

4.       Manage your cash flow: This is for businesses that have already started and yet still require funding to grow. Venture capitalists would be so interested in your financial statements, your initial capital, profits, expenses, tax and matters concerning your business finances. This is because the report is what will determine the outcome of their monies when they invest in your business. Using a software to record your transactions and records will do you a lot of good if you are thinking of venture capital. It will aid you in presenting a proper picture of your cash flow. If you are able to manage your cash flow, which will result in great profits, venture capitalists will consider you.

5.       Vision, mission and core values: Passion and vision are what sometimes drive venture capitalists to fund emerging businesses. Do you have a mission, vision and values for your business? It is a step to show how passionate and serious you are about the business. It helps to guide the funder on what to expect from you and the business. It creates an impression of an organized, structured and a potential success.

Is the idea of venture capital scaring you? Do not be! Your business has the chance of growing into one of the biggest companies in the world like Apple, Starbucks, Intel, and Microsoft which all received funding from venture capitalists.

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