Saturday 28 February 2015







I’ve never raised investment before, but from speaking to a handful of friends and my accountant I’m confident that the progress of my business means that it is ready for venture capital funding and I’m keen to accelerate growth. Without revealing too much about the business, it is in its third year, has a turnover of £2.3m and profits of £600,000. My long-term plan is to roll it out region by region with satellite offices, as most of our clients are in the South East right now. What would you advise me to do with respect to making the business attractive to investors?

A. Alastair Mitchell writes:
It’s becoming increasingly difficult to raise venture capital (VC) in the UK. Despite the government’s best efforts to improve it, the environment remains tough and there is a lot of competition from companies all looking to secure funding for growth. The challenge is to get your company noticed above all this noise. If you can convince a number of high-profile people that what you are doing is a great idea – and you have the courage to get out there and talk about it – your credibility will increase. One of the best tips I can give you is to attend as many networking events as you can. They are great for meeting with venture capitalists (VCs) and also provide an excellent opportunity to meet with other entrepreneurs.   Entrepreneurship is like an addiction and many people will have been through the mill a few times and have a great contacts book of investors. Talk to them about your business and mention that you’re looking for funding. There’s every chance that they will know someone who might be interested. In keeping with my networking advice, ensure that you use Linkedin to stay in touch with contacts. You can then work out who can connect you to any interesting VCs and ask them for a personal introduction by email. Another tip is never, ever pay to pitch for funding because great VCs don’t attend the kind of events that encourage this practice. When meeting VCs, ensure that you know your metrics inside out – customer acquisition cost, churn and lifetime value. And make sure you have solid justifications for any projections. In addition, remember that you are interviewing the VC just as much as they are interviewing you. You will have to work with this person and company for three to five years, so be certain that your ambitions are aligned with theirs. Good luck!

13 comments:

  1. This comment has been removed by the author.

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  2. setting up a business venture someone has to have what its takes in teams of acquiring knowledge in business orientation and must be strategics in competing with competitors

    BY AFOLABI TAIWO OLAIDE

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  3. the spirit of an entrepreneur is to be a risk taker. But not withstanding this before setting up a business, one needs to study the environment he/she wants to introduce his business into.

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  4. Setting up a business someone needs to plan very well, because if you fail to plan you have plan to fail. one need to make a thorough research on his target audience and network with people that would patronize his business.

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  5. Going by this article it is pertinent for an entrepreneur to understand business environment and on how to achieve a target goal of setting up the business, this must be handled with all seriousness. he or she must welcome initiative or ideas and also impact plan which must be a regular activity because success is the sum of small effort repeated day in and day out.
    ADEWOLE ABOSEDE K

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  6. An entreprenuer should be ready to take risk,success is not what you can achieve in a day;it requires a gradual process. Motivational books, seminar on entreprenuership and articles like this could be of help sometimes.

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  7. ADELEKE BEATRICE OMOLOLA
    As an entrepreneur you need to know what entails before embarking on a business,know the 4p's in marketing so that the risk will not be too much for you.

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  8. BELLO ABDULAFEEZ OLAIDE
    Before setting up a business enterprise you must have the idea of the busines so as to avoid heavy risk

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  9. As an entrepreneur u must know the dos and don't of business before setting up. Attend many networking events that will enable you to meet with business dealers of high integrity. OYETUNJI IKEOLUWA EYITAYO

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  10. Setting up a business requires risk taking. ADELOKUN DARE BABATUNDE

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  11. OLALEYE OMOTOLANI OMOBOLAJI
    Setting up a business requires planning and above all risk.

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  12. In any entrepreneur the manager is prone to facing lot of risk and he or she must know that profit does not come in immediately. The Manager is faced with so many challenges whereby he invest with his resources into the business. He is usually refer to as a risk taker. AKANGBE OKIKI-JESU CHRISTIANAH

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  13. TIJANI LATIFAT IBIDUNNI
    When setting up a business you need to have an indebt uderstanding of the kind of business your venturing into

    ReplyDelete