Released on: March 28, 2008, 3:52 am

Press Release Author: For More Free Resources visit www.oversightsystem.com

Industry: Management

Press Release Summary: Venture capital firms are comprised of individual partners.
These partners make investment decisions and typically take a seat on each portfolio
company's Board. Partners tend to invest in what they know, so finding a partner
that has past work experience in your industry is very helpful. This relevant
experience allows them to more fully understand your venture's value proposition and
gives them confidence that they can add value, thus encouraging them to invest.



Press Release Body: Venture capital firms are comprised of individual partners.
These partners make investment decisions and typically take a seat on each portfolio
company's Board. Partners tend to invest in what they know, so finding a partner
that has past work experience in your industry is very helpful. This relevant
experience allows them to more fully understand your venture's value proposition and
gives them confidence that they can add value, thus encouraging them to invest.

Fortunately, most venture capital firm websites list their partners with great
pride. Each partner typically has a bio that includes their educational credentials,
business accomplishments and investments that they have made. In identifying the
right venture capital partner to contact for your company, try to find the partner
that, from their background, will truly grasp the opportunity and can really add
value.

Once you have identified the most appropriate venture capital partner, it is
important to figure out how to contact them. As partners are often inundated with
business plans, having a personal connection and/or introduction is often the
difference between getting heard and not getting heard. For instance, if you
attended the same university or worked at a company that they did, call or email
them and use this as the introduction. If not, it is important to network. Call
people that may have been associated with the partner and ask for an introduction.

Getting the partner's attention is the first key hurdle in raising venture capital.
The second hurdle is getting them to believe in the opportunity, and finally, giving
them the enthusiasm and information needed to convince other partners in their firm
that investing in your venture represents a sound investment.
In Business Planning, Competition is Good

When developing the competition section of your business plan, companies must define
competition correctly, select the appropriate competitors to analyze, and explain
its competitive advantages.

To start, companies must align their definition of competition with investors.
Investors define competition as any service or product that a customer can use to
fulfill the same need(s) as the company fulfills. This includes firms that offer
similar products, substitute products and other customer options (such as performing
the service or building the product themselves). Under this broad definition, any
business plan that claims there are no competitors greatly undermines the
credibility of the management team.

In identifying competitors, companies often find themselves in a difficult position.
On one hand, they want to show that they are unique (even under the investors' broad
definition) and list no or few competitors. However, this has a negative
connotation. If no or few companies are in a market space, it implies that there may
not be a large enough customers need to support the company's products and/or
services.

Business plans must detail direct and, when applicable, indirect competitors. Direct
competitors are those that serve the same target market with similar products and
services. Indirect competitors are those that serve the same target market with
different products and services, or a different target market with similar products
and services.

After identifying competitors, the business plan must describe them. In doing so,
the plan must also objectively analyze each competitor's strengths and weaknesses
and the key drivers of competitive differentiation in the marketplace.

Perhaps most importantly, the competition section must describe the company's
competitive advantages over the other firms, and ideally how the company's business
model creates barriers to entry. "Barriers to entry" are reasons why customers will
not leave once acquired.

In summary, too many business plans want to show how unique their venture is and, as
such, list no or few competitors. However, this often has a negative connotation. If
no or few companies are in a market space, it implies that there may not be a large
enough customers need to support the venture\'s products and/or services. In fact,
when positioned properly, including successful and/or public companies in a
competitive space can be a positive sign since it implies that the market size is
big. It also gives investors the assurance that if management executes well, the
venture has substantial profit and liquidity potential.


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