Venture Capital Checklist
A Venture Capital (VC) fund invests money into a company for an equity stake in the business. A VC fund can help early-stage ambitious companies reach their growth ambitions.
The journey to securing VC is about proving that you understand your business and your unique selling proposition (USP). This checklist can help you navigate some of the common pitfalls, as well as understanding whether the process is achievable for your business – before you start.
PLEASE NOTE
This checklist is not part of an application process for Venture Capital. However, we hope it gives you an idea of what is involved and what you need to do to prepare. Investors may ask for more or less information about your business and the finance you need than what is set out below. This will change depending on individuals involved.
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STAGE 1: Getting prepared
Do you understand what finance your business needs?
What should you be asking for? How much money do you need? How much dilution will you accept?
Do you understand why VC is right for you?
These are big decisions that should not be taken lightly. Do you understand how the process works? Are you comfortable having a Venture Capitalist in your business? Do you understand that you may have to give over significant control of the business?
Have you done your research?
Have you researched firms who have worked with similar businesses? Have you spoken to entrepreneurs who’ve been through the process?
Have you been networking?
It’s a good idea to get out there and try to sell your company. Get out and talk to investors at networking events and VC initiatives to better understand the landscape.
STAGE 2: Choosing the firm
Have you done in-depth research on the firm?
Do your due diligence on the firm – they might have a say in how your company is run. Who are the firm? Who have they invested in before? What are their value-adds?
Do you need a value-add from your Venture Capitalist?
Do you lack any strategic expertise? Could your Venture Capitalist plug that gap?
Do your goals and expectations line up?
Are your outcomes aligned? Do you share the same vision for your company?
Do you believe you can work with the firm long term?
This person will offer you help and support and may even sit on your board. Would you be comfortable spending a lot of time with them or having a difficult conversation if you need to?
Do you understand the fund’s investment portfolio?
Most funds have an investment thesis and focus on key trends. Do you fit into these?
STAGE 3: Preparing for the pitch
Do you have a pitch deck?
If an investor wants to meet, they’ll expect a 10-12 page pitch deck. This should include information on your team, strategy, competition and investment terms. It should be a talking aid, so doesn’t need to be your full business model.
Is your business plan in order?
Can you show a gap in the market? Can you explain the opportunity and how you plan to capitalise on it?
Have you contextualised your business?
Have you explained how you understand the market? Your competition? Why your proposition has the potential to be successful?
Can you prove everything you’re saying?
Investors expect entrepreneurs to really demonstrate their handle over the business. Do you have the evidence to back up your statements? Can you show how you’ve tested the market or validated demand?
STAGE 4: Thinking ahead to the deal
Do you have some budget set aside?
You need to have some money available to pay legal fees.
Have you planned your funding rounds?
Some funds are happy to invest multiple times in what are known as rounds. The sooner you can share your long-term growth plans, the better.
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