Page 1

Get
Funded
 Structuring
Your
Start
Up
Documents



emagine
group
      

   

Founded
in
2003
 Global
venture
development
firm
with
investments
in
15
countries
 across
multiple
industries
 Group
made
up
of:
   emagine
consulting
–
Consulting
and
Research
   iMedia
–
Graphic
Design
and
Web
Development
   tesla
communications
–
Technology
Planning
and
Management
   Wicked
Code
–
Software
Development
   4SquarePeg
–
Human
Resources
 We
are
venture
catalysts
 We
work
with
entrepreneurs
in
every
stage
of
business
 development
from
brainstorm
to
private
equity
investment



Our
History
In
Venture
Capital
  

   

In
the
past
5
years
   We
have
heard
over
600
elevator
pitches
   We
have
received
over
400
executive
summaries
   We
have
read
and
assessed
100
business
plans
   We
have
invested
over
USD
400
million
in
industries
ranging
 from
technology
to
fashion
and
publications
 Our
current
investment
portfolio
stands
at
USD
700
million
 As
a
result,
we
have
a
special
understanding
of
entrepreneurship
 and
how
to
get
businesses
funded



Our
Funding
Process
 Brainstorm


Internal
Business
Plan


~50
–
150
pages


Teaser


1
–
2
page
introduction


Elevator
Pitch


~5
minute
quick
pitch


Pitch
Deck


~15
–
20
slides


Business
Plan


20
–
30
page
plan


Executive
Summary


~2
page
introduction
to
Business
Plan



Why
Do
Entrepreneurs
Need
Business
Plans
    

Written
summary
of
a
proposed
business
venture
 Helps
us
understand
an
opportunity
and
how
to
best
exploit
it


 

Gives
a
blueprint
for
the
operational
and
financial
viability
of
a
 business
venture


 

Explains
marketing
opportunities,
go‐to‐market
strategy
and
post
 launch
promotional
plans
 Identifies
key
personnel’s
skill
sets
and
experience


       

Increases
the
chances
of
business
success
or
elimination
of
a
 business
idea
based
on
feasibility
 Specifies
the
potential
risks
to
the
venture’s
success
 Provides
a
baseline
to
compare
projected
vs.
actual
results



Why
Do
Venture
Capitalists
Need
Business
Plans
  

Helps
us
to
see
that
the
entrepreneur
has
thought
out
the
business
 idea


 

Shows
us
that
the
entrepreneur
has
done
their
homework
on
how
 to
bring
the
concept
to
market


   

Provides
us
with
the
financial
requirements
for
start‐up,
production
 and
operations
 Defines
the
return
on
investment
to
the
VC


 

Sets
a
timeline
for
launch,
growth
and
expansion



6
C’s
of
Business
Plans

            

Complete
 Clear
 Credible
 Compelling
 Customer
Focused
 Concern
for
the
Investor



Do
You
Know
What
You’re
Getting
Into?



Benefits
and
Challenges



What
You
May
Not
Know



Elements
of
A
Business
Plan



Well
Structured
Business
Plan
                  

Executive
Summary
 Mission
Statement


 

Business
Description
 Industry
Analysis
 Business
Strategy
 Customer
Analysis
 Product/Service
Offering
 Marketing
Strategy
 Promotional
Strategy


 

 

         

Competitor
Analysis
 Team
Composition
 Operational
Plan
 Technology
Plan
 Research
&
Development
 Financial
Forecasts
 Investment
Strategy
 Supporting
Appendices



Executive
Summary
  

“The
Elevator
Pitch”
that
summarizes
the
business
plan
into
2
 pages


 

This
should
be
written
last
to
assure
that
all
key
elements
are
 explained
first
in
the
business
plan
and
then
related
into
a
strong
 Executive
Summary
 If
the
Executive
Summary
isn’t
strong,
the
business
plan
will
never
 be
read


 


Mission
Statement
        

Entrepreneur’s
Vision
 What
is
the
business?
 What
will
it
become?
 What
will
it
stand
for?



Business
Description
  

Introduce
your
business
and
explain
it
   Legal
Structure
   Locations
   Market
Need
(Pain)
‐>
Solution
   Business
Goals
and
Objectives
   Overview
of
Unique
Advantages
   What
Benefit
Will
It
Provide
The
Customer
   Professional
Services
   Attorney
   Accountant
   Consultants
   Insurance



Industry
Analysis
            

Current
industry
position
and
trends
 Potential
trends
that
can
be
leveraged
for
business
success
 Total
size
of
the
market
‐>
How
much
can
you
serve?
 What
need
do
your
products/services
solve?
 Entry
barriers
 SWOT
analysis



Marketing
and
Strategy
Principles



Business
Strategy
          

How
will
you
gain
competitive
advantage?
 What
makes
you
unique?
 How
will
you
meet
your
goals
and
objectives?
 What
is
the
company
brand?
 What
will
it
cost
to
enter
the
market,
establish
position
and
 maintain
it?



Customer
Analysis
    

Who
is
the
target
customer?
 What
is
the
profile
of
the
customer?
   Demographic
and
psychographic
breakdown
   Customer
Need
Analysis
   Buying
criteria
   Value
proposition



Product/Service
Offering
  

           

Tell
us
about
your
product/service
   Key
Features
   Unique
Advantages
 What
does
it
do/What
need
does
it
satisfy?
 How
will
people
use
it?
 Where
does
development
stand
currently?
 Are
there
any
patents,
trademarks
or
copyrights
that
will
affect
 product
development?
 How
will
technological
changes
affect
product
development?
 What
are
the
shortcomings
and
how
do
you
plan
to
overcome
 them?




Marketing
Strategy
                

Prove
that
a
profitable
market
exists
 Demonstrate
customer
interest
 How
will
you
build
awareness?
 How
will
you
position
your
product/service
and
brand?
 What
is
your
pricing
strategy?
 What
is
the
Go‐To‐Market
strategy?
 What
is
the
sales
and
distribution
strategy?
 Is
there
a
service
plan
and,
if
so,
how
will
it
be
implemented/ followed?



Promotional
Strategy
                

Advertising
 Public
Relations
 Personal
Sales
 Websites
and
Social
Media
 Direct
Marketing
 Telemarketing
 Articles
and
Publications
 Budget?



Competitive
Analysis
      

   

Information
on
competitors’
market
share,
products
and
strategies
 What
are
your
advantages
over
the
competition?
 How
else
can
your
solution
be
achieved?
   Competitor
response
 What
will
it
take
for
customers
to
switch
to
your
offering?
 How
will
competitors
respond
to
your
market
entry?



Team
Composition
  

       

Breakdown
of
key
personnel
   Education
   Skill
Sets
   Professional
Experience
   Direct
relevant
industry
experience
   Accomplishments
and
track
record
(P&L
responsibility)
   Experience
of
the
team
working
together
   Status
and
Nature
of
Commitment
 Additional
roles
to
be
filled
 Talent
Acquisition
Strategy
 Board
of
Advisors
 Board
of
Directors



Operations
Plan
          

     

Detail
the
daily
operations
 Structure,
Ownership
and
Legal
Form
 Organization
Chart
with
responsibilities
 Leases
and
agreements
necessary
to
operations?
 How
will
the
offering
be
produced?
   Required
resources
   Capital
expenditures
   In‐house
and/our
Outsourced
production
 Post
Startup
Production
Expansion
Costs
 Supplier
Agreements
 Required
Licenses
and
Permits



Technology
Plan
  

     

How
will
your
venture
use/utilize
technology?
   Cut
costs?
   Increase
revenues?
   Streamline
production/product
delivery?
   Obtain
more
clients/customers?
   Business
Information
Systems?
 How
will
it
help
to
achieve
business
goals
and
objectives?
 What
will
be
the
costs
to
implement,
maintain
and
upgrade?
 What
are
the
training
costs?



Research
&
Development
Plan
    

Does
your
offering
require
on‐going
research
and
development?
 How
will
it
be
funded
and
carried
out?


 

What
indicators
will
be
used
to
determine
where
the
research
and
 development
should
be
directed?


 

How
will
it
be
implemented
into
product/service
development
and
 management?
 How
will
the
research
ownership
be
controlled?


 


Financial
Forecasts
    

   

   

Capital
Expenditures
 Sales
Forecast
   Will
you
sell
on
credit?
   What
will
your
policy
be?
   What
will
it
cost
you?
 Breakeven
Analysis
 3
Sets
of
Forecasts
   Optimistic
   Most
Likely
   Pessimistic
 Monthly
Proforma
for
Year
1
 Quarterly
for
Years
2
–
5



Investment
Strategy
          

Amount
of
required
capital
 Personal
investment
 Use
of
funds
 Return
on
Investment
 Exit
strategy



Appendices
  

 

 

Resumes
   Owners
   Shareholders
   Key
Personnel
 Financials
   Start
Up
Expenditures
   Income
Statement
(1
year)
   Cash
Flow
Statement
(12
 months)
   Balance
Sheet
(1
year)
   Personal
Financial
 Statements
 Competitor
Weaknesses


               

Risk
Assessment
 Required
Business
Equipment
 with
Quotations
 Market
Research
Studies
 Industry
Studies
 Research
&
Development
 Key
Agreements
 Technology
White
Papers
 Advertising
Materials
(if
 available)



How
Do
We
Decide
Who
To
Fund?



Three
Tests
  

 

 

Reality
Test
   Does
the
market
really
exist
for
the
offering?
   Can
you
build
it
within
the
costs
defined
in
the
plan?
 Competitor
Test
   Company
position
relative
to
key
competitors
   Management’s
ability
to
create
a
company
that
can
give
a
 competitive
advantage
over
rivals
 Value
Test
   Will
it
make
money?
   Will
it
cover
operating
expenses?
   Does
it
give
investors
an
attractive
rate
of
return
or
a
high
 probability
of
repayment?



Things
That
Keep
Us
From
Funding
                  

Lack
of
logic
in
the
development
 of
financials
 Unrealistic
financials
or
lack
of
 detail
 Lack
of
planning
for
variables
for
 business
 Underestimating
upfront
 marketing
&
advertising
costs
 Location!
Location!
Location!
 No
research
on
upfront
costs,
 purchases
and
expenses
 No
allowances
for
A/R
and
A/P
 Forgetting
to
include
a
reasonable
 salary
 Pie
In
The
Sky
Projections


 

No
quotes
for
required
products,
 services
and
equipment


 

Failing
to
relate
to
a
real
need/ requirement


 

Trying
to
be
all
things
to
all
people
 No
Go‐To‐Market
strategy


           

“We
have
no
competition”
 Business
plan
too
long
or
too
 technical
 No
risk
analysis
 Poorly
organized
business
plan
 Badly
designed
or
un‐proofread
 business
plan



Get Funded - Structuring Your Start Up Documents  

A guideline for how a strong business plan should be prepared for funding and the common errors that most entrepreneurs make.

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