Are you looking for funds to startup or expand your business? Here’s a grant writing help for you to know what venture capitalists (VCs) look for.
VCs are not always wealthy people who give away money easily. Yes, they help firms grow and succeed but they are also on an active search for those who have the potential to yield a return of investment in a short span of time.
They are the same as bankers in the sense that when investing money, they consider factors such as the outcome of the past projects, total requested amount, budget allocation, and target annual profits among others.
Being involved in long-term capital, VCs does not only look for the income coming from interests, but rather part owners of the firm where they can invest. In other words, they expect to reap its fruits after some years.
Aside from start-ups, VCs also target firms that may become a leader in the industry by pursuing projects that will gain a market advantage.
In the process of reaching a consensus on how they will run the business, the prospective firm and the VCs develop mutual respect, understanding, and teamwork.
Where Should I Focus?
Many VCs, if not all, tend to focus on firms that have the following:
Commercial Viability
This means that the firm offers products and/or services that can be reproduced. These should produce huge profits after some time.
Defined Market
This means that the firm should clearly identify its target market for its products and/or services. It should be able to address the need of a certain group of people or the society in general. It should also form and device a valid and feasible plan to maximize the process of generating revenues.
Solid Management Team
Firms should have a leader that inspires people. It should be led by people with vision and expertise to make a change and succeed. It should consider the best practices to satisfy the clients.
Innovativeness and Sustainability
This means the firm should be able to come up with an idea that is unique to the industry and market as well. It should be able to withstand rivals, knowing their flaws and strengths.
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