You are passionate about your vision and believe strongly in its merits. This Is undeniably the best from which to begin to source financing to any project or business. Now step back and focus on what you need to prepare to make your project obvious.
Financiers are always looking for opportunities: but, the roads is long, with sudden turns, unexpected challenges, and risks in the minefield that lies just before the destination.
RISKS TO ANTICIPATE
No one is as passionate about your vision as you are. While you know your idea is great, financier’s needed extensive and detailed proof the commercial opportunity.
You will not attend the credit committee where decisions are made and will have to rely on professionals who have a job to protect. Prepare them well by making sure they fully understand what you have to offer.
The market conditions may change significantly along the way. Stay enthused but keep an eye on things.
DIAGNOSIS AND STRATEGY
Know your industry (completion and customers) inside out.
Understand the requirements of financiers.
Ask yourself what you would need to see in order to be convinced to invest in your own project
Address key issues in detail: choice of location, management skill gaps you intend to fill, branding, pricing, distribution, defensible financing requirements and achievable projections.
INFORMATION PACKAGE
Present this in clear language and include an executive summary financial plan, market research production documentation.
Anticipate questions that may arise during the next step
How do you measure the potential product?
Has anyone on your team done something similar before?
What are customers willing to pay?
How much growth has the sector seen in recent years?
Is there a realistic exit for all shareholders?
DUAL DILIGENCE
Financiers examine the opportunity according to their own criteria. Management’s preparedness to launch and operate the business is generally the most important factor.
NEGOTIATIONS
Negotiate with investors over valuation.
The challenge is to show how your process and execution capability minimizes their perception of the risks.
RESULT
If you made all the right moves, the result is success and you are now closing on the financing
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