Do you have a brilliant business idea on your hands and a burning desire to get it off the ground, only to be hamstrung by a lack of finance? If so, it might be worth your while pursuing wealthy investors for an injection of venture capital.
If you’re fully confident that your business idea has plenty of potential, submit your business plan to a VC, who will then review it in detail. There’s a good chance that they’ll say no, as VCs don’t part with their money easily, but if they are impressed by your proposal, they’ll want to talk to you again and they might even respond with a proposed investment for a share of your business in return. At that point, they will become actively involved in the company, so it’s important to find a VC with whom you are likely to forge a mutually cordial working relationship.
Whilst establishing a rapport with a VC is crucial, you won’t get the opportunity to do so unless your pitch is very convincing. You’ll need to demonstrate that you know exactly where you want the business to be in the short- and long-term future and you’ll need to be prepared for questions the VC may have – they will almost always put a few questions to you once the presentation is done. This is where you’ll need to play ball by addressing those questions directly, as too many entrepreneurs dodge such questions or are so rigid in their pitch that they freeze upon trying to find an answer.
If you truly believe that your presentation skills, personality and business plan are up to standard, though, venture capital could be the only missing piece of your entrepreneurial jigsaw. Find out more in this infographic from Irish tax consultancy firm All Finance Tax.
Venture Capital Explained
If you have seen the TV show Dragon’s Den, you will have an idea of what it is like for entrepreneurs to approach venture capitalists with a business concept, and what is likely or unlikely to persuade a venture capitalist to invest in a business. After all, they will want an adequate return on their investment, so it is up to the entrepreneur to sell themselves as best as they can in the pitch – a lucrative business idea also needs a confident, diligent and co-operative person to make it work.
Infographic source: All Finance Tax