Know-How Exchange : Strategy

Steve,

Sorry, it’s not as simple as just getting names and contacts.

People spend years trying to get investors to swap cash for equity and ultimately fail.

Many books, articles and seminars on this topic as every startup out there has an insatiable need for cash, so read as much on this as you can.

Vevolution's advice about bplan, financials etc. is correct because you will need this info once you start presenting to investors.

You also need to develop an investor presentation. This needs to be as polished and tight as you can get it. Practice this thoroughly before you bring your show on the road.

My best advice is:

1) Bootstrap and see #2 & #3 below and try to get paying customers because this provides revenue and proof of concept.

Without this you will never get serious investors, they just don't throw their money at "great" ideas; they want to see customers and revenue.

2) Friends, Family and Fools, the big 3, are your best for short-term financing to get you to the first level of being able to roll it out to the proof of concept level, that is, to where you have customers and revenue.

3) Most investors, at any level, also like to see that you have more than just sweat equity to lose. They like to see some level of financial contribution on your part, so if they lose, you lose.

If this means trading your car for a less expensive model, maxing out your credit cards, cashing in your 401K, and any other means of getting more liquid, than so be it, that is the price and pain you will have to pay.

But if you believe your value proposition is worth it, than this will help impress and sell potential investors on your committment.

Good Luck!

My friend, less than 2% of businesses are funded by angel investors or vulture capital firms. Don't waste a moment crafting a five-year revenue forecast or diddling with PowerPoint slides that some well-intentioned corporate retiree (a.k.a. Mr. Beached White Male) coaches you to produce.

Focus all of your efforts on shoestring product development and then get a customer to beta test it, even if it's a skinny version 1.0. Listen to their feedback, respond quickly with product changes, and then get them to buy.

Move in with your mom. Eat peanut butter sandwiches. Drink cheap wine.

After you've done all of this, you MIGHT find an investor. Better still, you might not need one!

I offer this to you after living through everything I just described. Mom, if you're reading this, I love you!

- Shelley