- We like leading and/or participating in
reasonably-sized syndicates... but if you need to raise $50
million, we're not going to be a viable partner. You're better off
with investment bankers.
- We'll sign a reasonable non-disclosure
agreement when we reach a point of mutual interest... but if an
NDA is our first contact with you, we'll probably toss it in the
trash. Mutual trust is part of our business.
- Business plans need to be convincing; they
don't have to be pretty. Unless you're building a color printer,
don't waste your funds on color printing. And unless you're
plotting three dimensions of data, don't print 3D graphs!
- Don't ignore your competition. As Guy
Kawasaki says: "The perfect market has no established competitors,
it's growing at 50 percent a year, and there are high barriers to
entry for everyone but you. Wake up and smell the silicon. There
are no such markets."
(Most of the smart people in the world
don't work for you. Explain how you're going to win in spite of
that.)
- Arguments such as "This is a $1 billion
dollar market, so all we have to do is capture 2% and we'll be a
$20 million company!" just don't cut it. Markets tend to shake out
into a 50% player, a 30% player, and a lot of little companies who
don't make any money. Convince us you're going to be one of the
first two.
- Technical risk is our business; market risk
is not. That means we are quite willing to invest in a better
mousetrap if you can prove there is a vibrant and growing market
for mousetraps. Betting that a particular market is "bound to
emerge soon" has been the epitaph of many high-tech
companies.
- Cheops' Law: Everything takes longer and
costs more. If your business plan is based on a "window of
opportunity," we're going to get nervous. If your development
slips a bit and the window closes a bit early, is there any market
left?
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