As we enter 2021, many entrepreneurs will likely have goals for success that include raising capital. The prerequisites for a venture-funded company are clear-cut: You must have a strong potential for high-growth and a willingness to build an exit in five to seven-plus years. For the last several years, Rev1 Ventures has been recognized as one of the most active seed funds in the Midwest. We learn something new every single day and on every single deal. Here are five of our most valuable lessons.
1. Before You Ask Someone Else for Money, Have a Well-Thought-Out and Well-Written Business Plan The business plan defines a problem in the market and how your company is going to solve that problem. This is the document that investors base their decisions upon. Company founders must write the plan themselves using guidelines, suggestions and templating tools, certainly — but the writing of successful business plans cannot be delegated. Writing a business plan gives the founders and early management team the perfect opportunity to work together to hammer out and formally express the assumptions and intentions of the business. It is a living document and the touchstone of progress. It includes market and customer intelligence, talent needs and reflects three- to five-year growth scenarios, including potential flashpoints. Anticipate and answer the questions investors want to ask.