1. Zsuzsanna Fluck Broad MBA Business Plan Competition Preparatory Workshop 2012 1 What makes a business plan successful to raise venture capital funding?

2. Zsuzsanna Fluck Broad MBA Business Plan Competition Preparatory Workshop 2012 2 What makes a business venture successful?  the people  the opportunity  the market  the deal  The degree to which they fit together.

3. Zsuzsanna Fluck Broad MBA Business Plan Competition Preparatory Workshop 2012 3 The people  Who are the founders?  What have they accomplished?  What is their reputation?  Do they have relevant experience?  Can they adapt to changes?  How will they respond to adversity?  How committed are they to this venture?

4. Zsuzsanna Fluck Broad MBA Business Plan Competition Preparatory Workshop 2012 4 The opportunity: The bottom line  What is the idea?  Why is it better than other solutions on the market?  How do you generate revenues?  What are the costs involved?  When do you have to buy resources?  When do you have to pay for them?  How long does it take to acquire a customer?  How much capital equipment is required to support a dollar of sales?  What is the probability distribution of payoffs?

5. Zsuzsanna Fluck Broad MBA Business Plan Competition Preparatory Workshop 2012 5 The Market: Who Are the Customers?  Who is the customer?  How does the customer make decisions?  To what degree is the product or service a compelling purchase for the customer?  How will the product be priced?  How much does it cost to acquire a customer?  How much does it cost to retain him?

6. Zsuzsanna Fluck Broad MBA Business Plan Competition Preparatory Workshop 2012 6 Who are the competitors?  The value of the growth opportunities depends on the competitors  Who are the competitors?  What resources do they control?  What are their strengths & weaknesses?  How will they respond to entry?  Who else might be able to exploit the same opportunity?

7. Zsuzsanna Fluck Broad MBA Business Plan Competition Preparatory Workshop 2012 7 The deal  What is the pre-money valuation?  How much investment are you seeking?  What stake of the business are you selling?  What is the financing history and who are the current owners, claimholders?

8. Zsuzsanna Fluck Broad MBA Business Plan Competition Preparatory Workshop 2012 8 The concept of integration  To what degree do the people have the right experience, skills and attitudes given the nature of the opportunity?  To what degree does the opportunity makes sense, given the people involved, the opportunity and the deal struck?  To what degree is the concept favorable given the people, the context, etc.?  Why should the VC invest in the deal?

9. Zsuzsanna Fluck Broad MBA Business Plan Competition Preparatory Workshop 2012 9 How does the VC evaluate a business plan?  What can go wrong?  What can go right?  What decisions can management make today to ensure that what can go right does go right and what can go wrong is avoided?  How can the reward to risk ratio tilted in favor of the venture?  Why should the VC invest in this company?

10. Zsuzsanna Fluck Broad MBA Business Plan Competition Preparatory Workshop 2012 10 What are VCs Looking for?  Business Plan in line with the VC’s focus  Discontinuity in technology/ High IRR  Team that have the ability and vision to execute and that they can work with  Promising business model  Advantage to competition  Protection for intellectual property  Potential for exit with attractive multiples in the timeframe of the fund

11. Zsuzsanna Fluck Broad MBA Business Plan Competition Preparatory Workshop 2012 11 Business Plan/Presentation  10 pages  Summary of concept (1 paragraph)  Team  Idea, Product Line, Company, Intellectual Property  Market, Costumers, Competitors, Price  Business model: How are you going to make money?  Timing of Cash Flows, Cash Flows, Profits, Assets, IRR  Valuation, Existing Investors, Existing Contracts  How much funds are you looking for?  What fraction of the company are you selling?  Why should the VC invest in the company?

12. Zsuzsanna Fluck Broad MBA Business Plan Competition Preparatory Workshop 2012 12 Business Plan/Presentation  CLEARLY and QUICKLY articulate what product does for customers and how revenue is generated.  Use balance sheet and income statement as the table of contents (revenue, gross margin, operating expenses, earnings timing)  Be critical in advance  Provide what each reader target will need…  Clear review of product, market, competing alternatives, differentiation, execution plan and exit  Evidence of every statement you’re making or credible support  Overview financials with very detailed assumptions and sensitivity  In presentation show passion, confidence and flexibility  Prepare elevator pitch and 10-minute presentation.  Be ready to give crisp answers to questions