Chapter 21
Attracting Outside Investors to Your Startup
In This Chapter
Finding out what you need to do before a startup
Filling out a valuation worksheet for investors
Understanding the roles of valuation professionals in a startup
Working with different types of investors
Every owner of a young company needs good advice to prepare him for the many stages of investment that will eventually take his business to the desired size as a private company or all the way to public ownership.
Particularly in the technology arena, many business owners work hard to solicit financing to help their companies grow at very fast rates. But because proving value in new companies that may not yet be producing much in revenue and profit is difficult, you need outside expertise.
In many ways, the process of attracting outside investors is not much different from the process of bringing in a conventional buyer or banker. Even if you started your company in a garage or a basement, you have to present it as an organized company, with transparent operations and finances, to any potential buyers, investors, or lenders; otherwise, they just won’t care.
This chapter outlines the importance of getting valuation expertise when starting a business and the areas in which you should use outside help.
Exploring Your Startup Resources
We emphasize throughout this book that no two valuation professionals analyze the value of a business in exactly the same way. When you’re talking about a startup, you’re talking ...
