John Callender of Intrepid Private Group has helped countless entrepreneurs find the investors they need to turn their business plans into successful corporations. As the CEO of Intrepid Private Capital Group, John Callender can say from experience that an idea can only get a person so far. That person must have a business plan with the “wow” factor to garner the attention of serious investors. Today, John Callender will discuss what top investors look for in a business plan.
One thing to remember when it comes to venture capitalists is that while they are actively looking to invest, they are also looking to mitigate their risk. John Callender believes that a business plan must do a great job of establishing who the management team of the business is and why their proven track record makes them a good investment. Wise investors understand that a business is only as strong as the people behind it. Those without experience will often have to turn to family or friends to invest in their business, as professional investors will want to see a track record of success. When it comes to risk, it is usually easier to weigh the potential of a product as opposed to a service. Because of this, those selling a product that has a clear competitive advantage – or fills a void in the marketplace – will usually have an easier time attracting investors.
One of the most common mistakes made by companies looking to attract investors is overpromising. John Callender warns that professional investors can spot this from a mile away. It is better to make realistic projections as opposed to outlandish claims. Only realistic valuations will be considered by investors. It’s often a good idea to get a valuation from a third-party as it can be difficult to self-evaluate. With that being said, it is wise to be asking for a serious amount of money. Professional investors are willing to invest large sums when there is a clear plan of where the money will be spent and how it will help propel the overall profitability of the business. It is also imperative that the business outline shows how quickly the money will be able to be repaid to the investor. Some are willing to be in it for the long-haul, if the idea is strong enough, but they will want to have definitive proof that the money will be recouped in full and then some. The numbers absolutely must make sense!
