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What Does Your Business Actually Do?

Q: I love your article in the Entrepreneur magazine. It was very information. Thank you.  I am now currently developing the domain name I had for 9 years to due other business and real estate investments.  Do you have any suggestions which VC wants to invest?  Currently looking for $100k to $250K. I only want to serious investors only.  Also, I want a VC with connections and experience in helping develop a company, not just throw money into this venture. This is my second business and so I am familiar with growing a business.

A: (Brad) I took a look at your website and have no idea what your business does.  My strong recommendation is that lead any email you send to a prospective investor with a short (a paragraph or less) description of what your business will do.  Just saying that you are developing a domain name doesn’t really mean anything.

In addition, if you are only raising $100k to $250k, it’s unlikely that VCs are the right target for you.  I’d encourage you to focus on your network of friends and family along with potential angel investors who are either geographically close to you or are interested in what you are up to.

But – most importantly – make sure you are stating clearly what your business is going to do in whatever approach you make to any investors.

December 21st, 2008 by     Categories: Fundraising    
  • http://elliotross.wordpress.com Elliot Ross

    Brad, you actually brought out a howl of laughter!

    Even outside of your VC space, too many businesses in the SME space ignore what they actually do. If they have geographic contraints – they ignore that too (living in Ottawa Ontario, I don't need Ottawa Kansas when looking for a roofer)

    Thanks!

  • Phil Karl

    It seems like more and more dreamers popping up in the space. People hear some buzz words and assume VC is right for their company without doing the proper research. I feel bad for the VCs who have to decipher through a flooded inbox with pointless business plans or pitches. If someone is taking over 9 years to even start development on a “domain name” then I seriously doubt he is a candidate for any type of funding. Amen to you for even sending a response!

  • http://fastpitchnashville.com Marc

    This is a HUGE problem that we have noticed as well. Here in Nashville, we're taking action and trying to do something about it. We've created an event that teaches entrepreneurs how to craft a well executed elevator pitch that covers ALL of the most important items that not just an investor but anybody would want to know about your business in under 60 seconds.

    We call this event PitchCamp, and afterwards the community will even award their favorite pitch $10K! I hope to see more things like this pop up all over the country to help entrepreneurs craft a more compelling message. Check out our event online at http://fastpitchnashville.comand hope some of your readers come out so they'll better explain what they do before seeking your advice.

  • http://medicalsparx.com KJai

    I've been to a few of the new 'speed pitch' events and heard this more than once. Fear is a great motivator. Too bad it comes so late in the process.