FAQ’s - Raising Venture Capital

Frequently Asked Questions and Answers

• What is the single most important thing I must do to successfully raise capital from investors?

I hate to answer this question because there are several things that you must get right to be successful. However, profiling what your investor “looks” like is certainly near the top of the list. It is better to approach 1 person who is specifically interested in your idea than 100 who are not.

• What is “seed” capital?

This is money you get from family, friends and local investors.

• Can I raise money?

Absolutely, the reason many people have difficulty is not the quality of their idea but their lack of knowledge on how to conceptualize and execute a plan to raise investor capital.

• How much should I raise?

If you read the Reg D information we have on the website, you will discover that amounts less than $1,000,000 have the least regulatory and compliance restrictions. However, this is dependent on the individual state securities laws.

• What do I need to give investors?

You will need to create investor documents before taking their money. See our website for more free information on this subject.

• What mistakes do entrepreneurs typically make when trying to raise capital?

Improper or incomplete business plan

Failure to properly educate themselves

Failure to put together a “plan” of action.

These are just some of the many problems we see each and every day. In each case, their efforts are a non-starter right out of the gate. Yet, with many of these persons had they done their homework and developed a proper plan they could have succeeded.

• Are there individuals or companies that will assist me in raising capital?

Yes, If you are an operating company with sales greater than $20,000,000. However, to receive commission for introducing investors an individual or company must be registered as a broker/dealer with the Securities & Exchange Commission. Though there are exceptions, it is unlikely that most persons can legally be paid a commission by you.

• Does every project have investors that can be identified with an investor profile?

Yes, some are easier than others but all projects have investors that would be biased in favor of their project.

• What do I need to do to successfully raise money from investors?

A good idea that you explain how you plan to implement and execute.

A first rate business plan geared to the investor profile. (Investors don't invest in ideas, they invest in the explanation of how the idea is to be executed)

A game plan to identify the prospect and present your idea.

A private placement memorandum and subscription agreement

Are you deciding whether to proceed or even how to proceed raising capital for your business or a new start up; you will find that there is a great deal of free information on this website. If you have decided to take your project to the next level you may want to consider reviewing our audio seminars. These seminars not only provide a much higher level of knowledge and information but on completion allow you to structure a “game plan” of what needs to be done and how to do it.

Copyright 2011- Lance Shields-All Rights Reserved-About the author  >>>click here<<<