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Seven tips from personal experience of the founder of Internet service accounts, "My Business"
In March of this year we have successfully completed a deal to raise $ 4 million investment in our service Internet accounts from the fund Klever Internet Investments Limited. Here are some practical tips from our experience for those startups who want to raise capital in the amount exceeding 100 million rubles.
The role of business angel
In fact, the key thing was done much earlier - in the spring of 2010, when the capital became a business angel Sergey Panov. Two years together we rebuilt the business processes in the company would make the beautiful idea of system operating business. It was Sergei took on the primary job of raising the next round of investment, which is not possible to maintain momentum, which develops "My job is." So my first piece of advice: before you attract investments from foundations, start by finding an experienced partner, a business angel. This will greatly improve both the business itself, and its value in the eyes of potential investors.
Marathon
Tune in for a marathon, not a sprint. If you are looking for a few million dollars, then get ready for that, most likely, it will take at least six months and most of the operating time. Only at the meeting will go at least seven working days per month, and apart from the meetings will need to edit your presentation, add a financial model and to answer many questions. If you try to do it alone, then the time for business management practice will remain.Financial model
Make a good financial model. It is best to employ a consultant for this, which immediately makes it into a form suitable for investors.Our model started with 10 sheets of Excel at the first meeting, and by the middle of the marathon, it was already 18 pages of calculations. This is actually a very useful exercise that will help you to look at your business with a bird's-eye view and see which indicators are most important for the activity.
Meet with all
Apply all the possibilities, and sometimes the money is in the most unexpected places. It is better to draw one or more consultants. Of course, not the fact that the consultants will find it to your investors, but certainly a lot of organizing meetings in which you will understand how best to sell your project. Meet with anyone who showed even a minimal interest: at each such meeting, you will receive a new fidbek about your business and market vision from experienced people. If the meeting fails, still write the letter after the meeting. Most funds communicate with each other, and sometimes recommend projects to each other.
Analyze the goals of investors. If you have crept into even the slightest suspicion that your best interests and the interests of the investor are different, do not waste more time. Politely put talks on hold, and consider other offers. This is especially true of talks with strategists, and not with the funds.
Once you spend a sufficient number of meetings (it took us over 20), you will have several investors potentially interested in the transaction. It is desirable that such options were not less than three. From this point on the stage of finding investors can conditionally be considered closed and begin to move toward a deal. It takes two to four months depending on the fund. It is important to be prepared mentally to the fact that a fund may decline even at the late stage, without explaining the reasons why it is always better to have a few extra options.
Haggle in the negotiations
Thus, the investor is interested, and begins the most interesting phase of the negotiations: the structure of the transaction and its closing. Here are some tips for this stage of negotiations.
Haggle. Do not be afraid to challenge the first sentence of the investor. In the negotiations can be born options acceptable to both parties. What you need to pay particular attention to:
A. Sold by the investor's share. It can be reduced by agreeing on the KPI business, when you reach that part of the shares transferred to the founders. Or, conversely, the investors, if the business does not come to the calculated figures.
Two. Control of the company. Clearly limit the list of issues that need a voice of an investor to make a decision and make this list is non-extendible.
Three. The outputs of the business. Who, how and under what conditions might sell their shares in the future? What would happen if there was a strategist, ready to completely buy a business? What happens if an investor wants to sell only their share of the strategy?And the like. All these questions must necessarily be spelled out.Take this point seriously.
Business Security
Bargain outside Russian jurisdiction. This will ensure that your interests are fully protected. Probably, this item does not require additional comments.
Bring good lawyers. One mistake in the documents can be very costly since the company will be worth millions of dollars.
Do not be fooled
And the main board. Always tell the truth. In the initial stages can not say anything, but never, under any circumstances do not deceive prospective partners. Trust - one of the prerequisites for building a strong partnership.
source:http://www.forbes.ru
please give me comments thanks
In March of this year we have successfully completed a deal to raise $ 4 million investment in our service Internet accounts from the fund Klever Internet Investments Limited. Here are some practical tips from our experience for those startups who want to raise capital in the amount exceeding 100 million rubles.
The role of business angel
In fact, the key thing was done much earlier - in the spring of 2010, when the capital became a business angel Sergey Panov. Two years together we rebuilt the business processes in the company would make the beautiful idea of system operating business. It was Sergei took on the primary job of raising the next round of investment, which is not possible to maintain momentum, which develops "My job is." So my first piece of advice: before you attract investments from foundations, start by finding an experienced partner, a business angel. This will greatly improve both the business itself, and its value in the eyes of potential investors.
Marathon
Tune in for a marathon, not a sprint. If you are looking for a few million dollars, then get ready for that, most likely, it will take at least six months and most of the operating time. Only at the meeting will go at least seven working days per month, and apart from the meetings will need to edit your presentation, add a financial model and to answer many questions. If you try to do it alone, then the time for business management practice will remain.Financial model
Make a good financial model. It is best to employ a consultant for this, which immediately makes it into a form suitable for investors.Our model started with 10 sheets of Excel at the first meeting, and by the middle of the marathon, it was already 18 pages of calculations. This is actually a very useful exercise that will help you to look at your business with a bird's-eye view and see which indicators are most important for the activity.
Meet with all
Apply all the possibilities, and sometimes the money is in the most unexpected places. It is better to draw one or more consultants. Of course, not the fact that the consultants will find it to your investors, but certainly a lot of organizing meetings in which you will understand how best to sell your project. Meet with anyone who showed even a minimal interest: at each such meeting, you will receive a new fidbek about your business and market vision from experienced people. If the meeting fails, still write the letter after the meeting. Most funds communicate with each other, and sometimes recommend projects to each other.
Analyze the goals of investors. If you have crept into even the slightest suspicion that your best interests and the interests of the investor are different, do not waste more time. Politely put talks on hold, and consider other offers. This is especially true of talks with strategists, and not with the funds.
Once you spend a sufficient number of meetings (it took us over 20), you will have several investors potentially interested in the transaction. It is desirable that such options were not less than three. From this point on the stage of finding investors can conditionally be considered closed and begin to move toward a deal. It takes two to four months depending on the fund. It is important to be prepared mentally to the fact that a fund may decline even at the late stage, without explaining the reasons why it is always better to have a few extra options.
Haggle in the negotiations
Thus, the investor is interested, and begins the most interesting phase of the negotiations: the structure of the transaction and its closing. Here are some tips for this stage of negotiations.
Haggle. Do not be afraid to challenge the first sentence of the investor. In the negotiations can be born options acceptable to both parties. What you need to pay particular attention to:
A. Sold by the investor's share. It can be reduced by agreeing on the KPI business, when you reach that part of the shares transferred to the founders. Or, conversely, the investors, if the business does not come to the calculated figures.
Two. Control of the company. Clearly limit the list of issues that need a voice of an investor to make a decision and make this list is non-extendible.
Three. The outputs of the business. Who, how and under what conditions might sell their shares in the future? What would happen if there was a strategist, ready to completely buy a business? What happens if an investor wants to sell only their share of the strategy?And the like. All these questions must necessarily be spelled out.Take this point seriously.
Business Security
Bargain outside Russian jurisdiction. This will ensure that your interests are fully protected. Probably, this item does not require additional comments.
Bring good lawyers. One mistake in the documents can be very costly since the company will be worth millions of dollars.
Do not be fooled
And the main board. Always tell the truth. In the initial stages can not say anything, but never, under any circumstances do not deceive prospective partners. Trust - one of the prerequisites for building a strong partnership.
source:http://www.forbes.ru
please give me comments thanks
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