Written by one of America's leading experts in the industry, Mervin Evans, the author of "NEW YORK VENTURE CAPITAL DIRECTORY!" REG D Made EZ! will teach you what are the best methods to search for private investment capital.
YOUR BUSINESS PLAN for private investors is not the same as a Venture Capital or Bank Deal!
Physically putting a Reg D business plan together requires you to translate your thoughts about how you're going to run your business (and how it will perform) into a format that is dictated, in large part, by the business you're in and the expectations of your audience .
While most business plans share a similar structure and contain similar information about a business, your business plan will be distinguished by those characteristics that are unique to your business. The following items need to be examined before you can start to write your plan:
Whom are you writing it for?
If you are writing for private parties outside your business, their needs and expectations will govern the type of information and level of detail in your plan.
Planning horizon: How far out into the future will your plan extend? Normally this is three or five years.
Type of business: Your business's classification as a service provider, product producer or seller, or mixed provider of products and services will have a large impact on the type of information needed in your plan.
Sources of information: What information is available to you in creating a business plan? How can you reduce the time and effort required to analyze your idea? How can you set yourself up for success by taking a realistic look at internal and external conditions of your business, so as to make reasonable predictions about the future?
Mervin Evans, urges his clients to prepare an private investor lead letter program. A well written Executive Summary is a must! Your Management Statement and Deal Sheet are critical paperwork.
Even individuals may be venture capitalists. In the early days of venture capital investment, in the 1950s and 1960s, individual investors were the archetypal venture investor. While this type of individual investment did not totally disappear, the modern venture firm emerged as the dominant venture investment vehicle. However, in the last few years, individuals have again become a potent and increasingly larger part of the early stage start-up venture life cycle. These "angel investors" will mentor a company and provide needed capital and expertise to help develop companies. Angel investors may either be wealthy people with management expertise or retired business men and women who seek the opportunity for first-hand business development.
Investment Focus
Private Investore and Venture capitalists may be generalist or specialist investors depending on their investment strategy. Angeles & Venture capitalists can be generalists, investing in various industry sectors, or various geographic locations, or various stages of a companyís life.
Alternatively, they may be specialists in one or two industry sectors, or may seek to invest in only a localized geographic area.
Not all Private Investors will consider a "start-up company." While venture firms will invest in companies that are in their initial start-up modes, venture capitalists will also invest in companies at various stages of the business life cycle. A private invesort may invest before there is a real product or company organized (so called "seed investing"), or may provide capital to start up a company in its first or second stages of development known as "early stage investing." Also, the venture capitalist may provide needed financing to help a company grow beyond a critical mass to become more succe