Ladies and Gentlemen:

In addition to the points raised by Mark C. White on how to present a winning image for your new venture, we thought it would be helpful to create a list of general tips for the first time entrepreneur based on my own experience in the arena of venture capital.

The process of developing and presenting a business plan is one of exhaustive analysis and perpetual refinement. The underlying purpose of this process is not just to convince investors to hand over their hard-earned money, but to make sure that your business idea is fundamentally sound. As entrepreneurs, you are independent and creative people, used to doing things your own way - the better way. When you first approach the process of finding investment capital, you will have to suppress this absolute independence and begin to trust the wisdom of others. For the first time in your lives, you will have to sit still and nod agreeably while someone you've only just met rips your ideas apart. It can be both a painful and rewarding experience. The purpose of this memo is to help put this experience in perspective in order to make the process work for you. By understanding what investors really look for, you are much more likely to be successful in your entrepreneurial endeavors.

The ability to clearly and succinctly articulate the business concept and plan.

You must be able to explain your business concept to a relatively non-technical investor in four sentences or less. Your explanation should communicate how your product creates value by solving a particular market problem, who your target customer is, the potential market demand for your solution and how you plan to bring your solution to market. If you find that you have trouble doing this, it probably means that you don't really have a firm grasp on your fundamental business concept.

A thorough and realistic understanding of the market, competitive environment and risk factors. Investors want to know that you have thoroughly investigated and analyzed your target market and have a good feel for major industry trends and expected demand for your product. You should be able to show precisely how your product is better than your competitors - be able to quantify this advantage. You must try to predict how the competition will react to your market entry and make sure your revenue forecasts reflect this. Investors also need to know that you have realistically budgeted for expected expenses, that you have a good understanding of the costs of doing business.

Good People. Often the first thing an investor will want to know about your business plan is who is involved. They look for a well-rounded team of experienced managers or, at the very least, a board of sophisticated advisors. 99% of a plan's success is in the implementation. A great product will only carry you so far; you will need people who can sell your product, people who can organize and administrate your operations, people can manage the company's finances. If you do not currently have such people on your team, begin looking now. Ask your accountants, your lawyers and venture capital firms along the way for advice on how to find people to fill the gaps in your skill set. By assembling a knowledgeable team of advisors, you can avoid making many of the mistakes of the first-time entrepreneur.

The passion to succeed. This is really important. The investor really wants to know that you are willing to fight for this to work, that you are seriously committed to making your concept succeed. However, it is important to distinguish between being committed to success and being committed to the product. In the past, I have often observed the founding members of a startup become unreasonably defensive about their product and underlying business ideas when faced with criticism. It is inconceivable to them that their idea, upon which they have committed so much of their energy and personal resources, could be flawed in any way. It is an amazing transformation. Here is an obviously intelligent and creative and motivated individual with what is often a good business plan, but who falls apart when told that their idea may not be perfect. How can investors trust their money with someone who reacts like this when faced with adversity, someone so afraid of the possibility that their idea might not work that they blind themselves to possible problems? Investors hate to have to play detective and root out potential problems. They want startup managers who can identify problems before they happen, who are intelligent enough to recognize and respond to risks. They want people who are so committed to success that they will be the first one to question the soundness of their product and ask, "How can I make it better?".

The search for financing can be an exhausting one. You will need to constantly reevaluate your ideas and learn to trust the wisdom of others. Be willing to question your ideas, surround yourselves with capable people, thoroughly investigate your market and clearly define your fundamental concept. Success is out there, but it takes a combination of passion and perseverance. I wish good luck to you all.