Obtaining the resources to facilitate the opening of a company is the dream of many new entrepreneurs, especially after taking “no” for trying to get a loan in banks. In addition to loans and financing, there is still the possibility of achieving the desired investment through a venture capitalist. But what will these factor investors have in mind when evaluating these proposals?
Venture capitalists are the investors who support companies to buy part of their shares, get involved in the company’s business to make it grow and see their shares if they appreciate even more. That is, in exchange for the money, trying to do the commissioning ends up giving part of your company to investors, who, analyze them on the company and its partners to determine if that is, undoubtedly, a good offer. CVCA is one of well known Canada’s based professional association for the venture capital and which deal in the private equity business.
However, approximately only 1% of the companies that risk in this universe can invest with venture capital investors. To help new entrepreneurs in this endeavor, venture capitalist Scott Paterson Toronto, listed six factors that he for all the time carefully evaluates when receiving these proposals. They are:
1) THE CHARACTER OF THOSE INVOLVED
The business idea can be revolutionary, but hardly the hammer of the investment will be affected if the character and personality of the partners are not compatible with the characteristics of the investor.
2) PROFESSIONAL CAPACITY OF EACH
Another factor that enters as decisive to decide to invest or not, is to evaluate the professional competence of the members of the company.
3) THE INNOVATION POTENTIAL OF THE PROJECT
It is not every day that investors face a new super (in the sense of creating a service capable of changing the entire market). However, innovation is also a determining factor in the decision to invest in a new project or not.
4) THE BENEFITS TO THE POPULATION
It is estimated that between 80 and 90% of new startups fail in their mission, and those few who achieve great success are precisely those who sought to solve a problem.
5) LONG-TERM SUSTAINABILITY
To a venture capitalist, business is going to be interesting only if it is able to maintailong-term. After all, any investor with full mental faculties will inject thousands of dollars into an idea that will be unfeasible, or obsolete, in the short term.
6) THE FINANCIAL PERSPECTIVES
Since these investors participate in businesses with the main objective to get a big return later with the sale of shares, of course, the financial perspectives of the company are also taken into account in time to evaluate a proposal.
When and how to return the investor will get an analysis is essential for the investment is approved, since venture capitalists like G Scott Paterson work that way: invest in new business, take advantage of the results to invest your money in a nearby company.