Things that venture capitalist look before funding a startup

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Funding is the basic necessity of every business. Angel investors are the basic level of investors that invest in a company at a very lower level. However, the investment they make is very small. The venture capitalists are the best ones to go to get a bulk of investment.

However, to get investment from these investors like Alan Jiwan isn’t an easy task. Before you move into seeking funding from a venture capitalist you need to make sure that you satisfy the points because these are the things that they look for in any startup.

Influential target

Venture capitalist usually looks for a startup that has a product that can grow rapidly in the current market. All they know is about the return that they will get. However, the investors won’t even look into the product if it isn’t on the market and is not collecting revenue. They set themselves on a long-term goal and see if the product is influential enough to pack up great revenue in the next couple of years.

bulk of investment

Exit strategy

No business is perfect and not all can hold the market. Exiting the market also comes in the business plan of the startup. All the venture capitalist will want to know the plan. No one wants to dump the money into the drain. If he would invest he wants to know the possible way he would get back the money. The most possible way is to sell it to others or have it in the stock exchange. Hence you have to decide your exit strategy. The investor wants to have the scalability of the investment that they make.

The business plan

The business plan that you put front should be clear and realistic. The business plan is the most important aspect of how the company would make business. It would be calculative with the necessary calculation and research of the product’s sustainability in the market. The investors have a huge knowledge about the market, and your calculative model and assumptions would make him be confident about the project.

Conclusion

Next time you seek funding for your project to make sure you look into the points.

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