The Seven Deadly Sins of Early-Stage Funding Requests
by Allen Kupetz
COO venVelo
Executive-in-Residence at the Crummer Graduate School of Business at Rollins College
In The Art of Bootstrapping Guy Kawasaki said, “The probability of an entrepreneur getting venture capital is the same as getting struck by lightning while standing at the bottom of a swimming pool on a sunny day.” And bootstrapping is a viable funding mechanism only if you have boots to strap, i.e., you have the ability to fund your venture with your own money.
For those of you in need of external funding, Kawasaki’s math is daunting. There is a rule of thumb that for every 500 bona fide business plans submitted to sophisticated investors, about 50 will get some consideration, five will become pitch decks seen by investors, and one will get funded.
So, what can you do to increase your chances of getting funded?
Other than being able to convince investors that you have the passion, persistence, and plan to be a successful entrepreneur, you should also avoid the following all-too-common mistakes:
1. Not Being Coachable
Miles Kington said, “Knowledge is knowing a tomato is a fruit. Wisdom is knowing never to put one in a fruit salad.” Investors want to believe that you are smarter than they are; it is a big reason they will listen to your pitch. But wisdom only comes with the experiences learned over a lifetime. Good investors can help you in many ways beyond just financially, but only if you are willing to listen and learn. Have an open mind to the opinions of those who have done it before. Be the expert in the product or service you are creating, but defer to those who know the many other critical pitfalls you must avoid in order to be successful. I recently reviewed a pitch deck that had many grammatical mistakes. I told the entrepreneur that some investors might take that as a sign he lacks attention to detail. His email reply was dismissive and ungrateful. Investors are generally betting on the jockey not the horse, so being a horse’s ass won’t help you get funded.
And it doesn’t stop when you cash the check. Continue to develop a relationship with your investors even after they invest. Everyone needs a boss, even the CEO. Employ an effective Board of Directors that questions your assumptions. Every top golfer has a swing coach because they are always trying to get better. Follow that example.
2. Not a Scalable Business
Your neighborhood may desperately need a new salad restaurant on Main Street and it might be profitable some day with solid execution. But borrow the money from a bank or raise it from the Three Fs of early-stage investing: friends, family, and fools. Early-stage capital is a high-risk investment and the best investors in the business are wrong more than 50 percent of the time. So the wins need to be big wins or the model doesn’t work. You must demonstrate that investors can make a substantial return and that is only possible if your business scales and scales quickly.
3. No or Low Barriers to Entry
In the must-read book Do More Faster, Tim Ferriss said, “Trust me, your idea is worthless.” An idea is not a business. A company’s success is much more dependent on management’s ability to execute than on the original idea. That said, if six high school students in Bangalore can replicate your app over a weekend, your business is in trouble. Patents are a barrier to entry, but they cost money, take a long time, and don’t protect what you’ve done – they just give you the right to sue someone who has infringed on your patent. In my view, the best barriers to entry are revenue-generating customers, robust sales and distribution channels, a management team with deep domain experience, and the ability to continue to innovate rapidly. As Will Rogers said,“Even if you’re on the right track, you’ll get run over if you just sit there.”
4. Weak Sales / Marketing / Distribution Channels
This is number four on my list, but number one in my heart. The single biggest weakness I see over and over again is a failure to understand how to build an awareness of your product, then an interest in it, and ultimately consumers willing to pay for it. “Social media” is not enough of an answer to the awareness challenge. “If you build it, they will come” only works in the movies to get folks interested. And the “App Store” similarly is not enough of an answer as your distribution channel since yours will be among the million or so already free or for sale there.
One way to jump start this process is with Eric Reis’ Lean Startup approach to a minimally viable product (MVP). Find a client to demo your MVP product or service. You won’t get paid, but you will get great feedback and, more importantly, a reference on which to attract distributors and resellers (and investors). If you are not ready for 10,000 customers then don’t sell direct – find a channel where you have 10 customers and each of them have thousands of customers.
5. Failing to Understand Resource Requirements
In engineering circles there is the Stanforth Rule that states, “There are only two kinds of problems in the world: those that violate the laws of physics and those that time and money can solve.” President Kennedy knew in 1961 that with enough money and enough time, the United States could land a man to the moon and return him safely back to earth. But he didn’t advocate landing a man on the sun. You shouldn’t either. If your idea doesn’t violate the laws of physics, don’t be afraid to explain how much money you are going to need to raise to achieve escape velocity. The ability to articulate that you understand that $500,000 in seed capital will not be your last raise is actually a huge positive. Remember the Rule of Twos: It will likely take you twice as long to raise half as much as you are looking for – budget accordingly.
6. Inappropriate Use of Funds
Certainly you are not going to tell an investor that the first thing you plan to do with his money is buy $6,000 office chairs for everyone in your company. But knowing specifically how the money will be spent is an absolute must. A plan to spend that scales the business faster and/or increases the team responsible for sales / marketing / managing distribution channels will help your cause. Remember it is their money even after they invest it in your company. If you want to raise more from them, or raise money from others who will ask them if you spent the last round responsibly, treat it like you are bootstrapping. Resource efficiency is the trademark of a true entrepreneur.
7. A Revenue Model, but No Profit Model
I’ve got a great idea for a business that will generate explosive revenue from day one: I’m going to stand on a busy street corner and sell hundred dollar bills for $90. My forecast has me grossing $9 million the first quarter and all I need is $10 million to get it launched.
Again, an idea is not a business. Don’t tell us how much money you are going to bring in; explain to us how much profit you are going to be able to retain, reinvest, and distribute.
Although not one of the Seven Sins, Not Doing Something Useful probably should be. Marcus Wohlsen of Wired magazine said, “The history of technology is littered with solutions to non-existent problems.” Investors want and need to make money and that fact drives most of their decisions. But, speaking only for myself, building something more than just a cool new restaurant finder or the like would sure help you capture my interest.
One final piece of advice to increase your chances of raising money: Be so good you can’t be ignored.
Allen H. Kupetz is the COO of venVelo, a Winter Park early-stage investment fund, and the Executive-in-Residence at the Crummer Graduate School of Business at Rollins College. venVelo has recently invested in three central Florida companies: flexReceipts, Row Sham Bow, and Zentila.
Looking to learn more about how to be a successful entrepreneur? The author recommends these books:
Blank, Seven. (2005). The Four Steps to the Epiphany: Successful Strategies for Products that Win.
Blank, Steven and Dorf, Bob. (2012). The Startup Owner’s Manual: The Step-By-Step Guide for Building a Great Company.
Cohen, David and Feld, Brad. (2010). Do More Faster: TechStars Lessons to Accelerate Your Startup.
Duhigg, Charles. (2012). The Power of Habit: Why We Do What We Do in Life and Business.
Dyer, Jeff and Christensen, Clayton. (2011). The Innovator’s DNA: Mastering the Five Skills of Disruptive Innovators.
Freid, Jason and Hansson, David. (2010). Rework.
Guillebeau, Chris. (2012). The $100 Startup: Reinvent the Way You Make a Living, Do What You Love, and Create a New Future.
Johansson, Frans. (2012). The Click Moment: Seizing Opportunity in an Unpredictable World.
Kidder, David. (2013). The Startup Playbook: Secrets of the Fastest-Growing Startups from 42 Founders.
Lacy, Sarah. (2011). Brilliant, Crazy, Cocky: How the Top 1% of Entrepreneurs Profit from Global Chaos.
Moore, Geoffrey. (2002). Crossing the Chasm: Marketing and Selling Disruptive Products to Mainstream Customers.
Ries, Eric. (2011). The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses.
Tatum, Doug. (2008). No Man’s Land: Where Growing Companies Fail.
Tjan, Anthony and Harrington, Richard. (2012). Heart, Smarts, Guts, and Luck: What It Takes to Be an Entrepreneur and Build a Great Business.
Wasserman, Noam. (2012). The Founder’s Dilemmas: Anticipating and Avoiding the Pitfalls That Can Sink a Startup.
Rollins will offer a Master of Science in Entrepreneurship
by Bill Grimm
Professor of Practice in Entrepreneurship and Negotiation at the Crummer Business School at Rollins College
Most advanced entrepreneurs don’t have the time to devote to obtaining an MBA while managing a rapidly growing company. What if you could take courses specifically focused on advanced entrepreneurship and receive a Master’s degree in entrepreneurship?
Starting in September 2013, the Crummer Graduate School of Business at Rollins College, in addition to its MBA program, will offer a new degree, a Master of Science in Entrepreneurship (MSE). For advanced entrepreneurs, the MSE will focus on those subject matters that are most useful for managing growth, raising capital and developing and executing an entrepreneurial strategy.
The program will consist of thirty credit hours with courses such as Entrepreneurship, Entrepreneurial Finance, Marketing for Entrepreneurs, Negotiation, Management for Entrepreneurs, International Business and Managing Technology. Evening and Saturday classes will be offered. Some of the courses will use a blend of distance learning and face-to-face classes to allow students to learn and collaborate utilizing the many resources available through the Internet, yet have the intense classroom experience created by the interaction between the students and the professor.
The Rollins MSE will give advanced entrepreneurs access to the outstanding faculty for which Rollins is known. With 30 credit hours required for the MSE, a student will be able to complete the MSE in less time and at a lower cost than required for an MBA.
I will be teaching Entrepreneurial Finance (raising capital for growth) and Negotiation for the MSE program and assist faculty members in other courses. I’m excited about the MSE because it will give advanced entrepreneurs the opportunity to take courses specifically designed for meeting the challenges faced by entrepreneurial companies without the need to take additional courses for the MBA program (although very important in the long term for students). With just-in-time learning available through distance and blended programs, advanced entrepreneurs can take important courses offered in MBA programs as needed in the future.
Rollins will begin accepting applications for the MSE in March or April 2013.
Building startup communities in Florida – too many feeders leading and not enough leaders leading
by Dennis R. Pape
Founder, Florida Venture Sourcing
I just finished reading Brad Feld’s “Startup Communities: Building an Entrepreneurial Ecosystem in Your City.” Feld, as most of you know, is an early-stage investor in Boulder and cofounder of The Foundry Group and TechStars. I highly recommend this book to anyone in Florida interested in helping build a startup community in their city.
I won’t review the book – you can find plenty of information about it on Amazon. Or, better yet, buy and read it!
Instead, I want to highlight one of his four principals of a vibrant startup community – the most critical principle of his “Boulder Thesis”:
Entrepreneurs must lead the startup community
Feld describes the different types of people and organizations besides entrepreneurs involved in a startup community including: government, universities, investors, mentors, service providers, and large companies. In distinguishing this group from entrepreneurs, Feld calls these support people and groups “feeders”. While a startup community will not be successful without both leaders and feeders, Feld writes, “the absence of entrepreneurs as leaders, or the overwhelming leadership by feeders, will doom a startup community”.
As Feld recently told Richard Florida: “Central, top down, planning — like the economic strategy of communist Russia, doesn’t work. Hierarchical planning, whether driven by government, university, or other hierarchical organizations doesn’t work. There is no president of a startup community. There is no vice president of membership, or vice president of education. Startup communities are networks — glorious in all their messiness and chaos. However, they aren’t simply organic phenomena. You have to have leaders who are entrepreneurs. They have to have a long-term view. They have to be inclusive of anyone who wants to engage. And they have to create, and have, activities and events occurring on a continuous basis”.
While entrepreneurs are busy starting and building their companies and trying to balance their work and family lives, Florida communities need their entrepreneurs to step forward and lead. In their absence, most Florida cities have had leadership by feeders and, as Brad Feld would predict, our cities have not developed vibrant startup communities.
71lbs Wins 4Q VenturePitch Orlando Competition
by Dennis R. Pape
Founder, Florida Venture Sourcing
VenturePitch Orlando, Central Florida’s technology startup pitch and networking event showcasing the latest technology startups in the region, announced today that Ft. Lauderdale startup 71lbs won both the Judge’s and Audience awards after pitching to four technology investor judges and an audience of some 150 early-stage technology founders, investors, and service providers at its fourth quarter event held on November 28th at The Abbey in downtown Orlando.
4Q VenturePitch Orlando showcased 4 promising early-stage companies who were selected to pitch their business plans from 20 applying companies. In addition to 71lbs, Emergency Medical Technologies (Ft. Lauderdale), JustFamily (Satellite Beach), and Coefficient (Orlando) presented. The competition was preceded in the afternoon by VentureSeries, a program sponsored by Hutchison PLLC, where the audience heard what’s needed to attract funding and create value in today’s business environment, and a dinner keynote presentation by Harper Reed, CTO Obama for America and Ex-CTO Threadless.com.
VenturePitch Orlando’s four technology investor judges as well as its audience selected 71lbs, a Ft. Lauderdale startup helping Small and Medium Businesses (SMBs) understand and reduce their shipping cost, as their pick for the most promising technology startup from both an investor and presentation perspective.
On behalf of the VenturePitch judges, Dave Odom, Principal of Arsenal Venture Partners in Winter Park, presented 71lbs Founder and CEO Jose Li with the judge’s award, a trophy and an audience with three angel/venture capital funds: IDEA Fund Partners, Arsenal Venture Partners, and Tamiami Angel Fund.
The Audience Award, pro bono services from the accounting firm Cross, Fernandez, and Riley was presented to Diaz by Jennifer Johnson of CFR.
“I’m happy to say that the response to VenturePitch from the Central Florida technology venture community has been extremely enthusiastic,” says Dennis R. Pape, founder of Florida Venture Sourcing, the host of VenturePitch Orlando. “Our approach of having technology investor judges provide helpful, actionable feedback to the pitching companies combined with providing an opportunity for the Central Florida technology venture community to see and connect with the newest startups in Central Florida, learn how investors evaluate pitches, and network with their peers and colleagues appears to be the key to our successful event. We look forward to hosting these VenturePitch events on a quarterly basis in Orlando in 2013 to give even more startups an opportunity to showcase their technology and company.
Is it technology looking for a market or a market looking for technology?
by Bill Grimm
Professor of Practice in Entrepreneurship and Negotiation at the Crummer Business School at Rollins College
Whenever I hear a company CEO say, “We have great technology and we’re looking for new applications for the technology,” I know this company is heading for trouble. When I hear a CEO say, “We know this market and we’re looking for new technology to solve problems that exist with users in this market,” I’m interested. So are investors!
It is so tempting for those who have developed a technology to think that there must be a market that can use this technology, that the technology developers lose objectivity and try to start a company to find the market that can use the technology. This company is about 90% of the time doomed to failure. So, why don’t the owners/developers get it? Businesses succeed because there is demand (a market) for their products and services not because they have great technology. OK, the most successful companies have great technology AND demand for their products or services.
But, you say, what about a market that will develop in the future and the entrepreneur who has a vision that the market will develop in the future? Well, you’ve heard that timing is everything. Most entrepreneurs who have a vision of a future market can’t imagine how long it takes for a market to develop and exhaust their resources before there is a viable market. Those that enter this nascent market just at the inflection point when a viable market is developing succeed while those who enter too soon fail. This is particularly true for companies that have a new technology.
Don’t get caught in the trap of having an interesting technology and believing you can start a company to find a market for the technology. Knowledgeable investors know this is a formula for failure.
“Vapor” Opportunities
by Bill Grimm
Professor of Practice in Entrepreneurship and Negotiation at the Crummer Business School at Rollins College
I often tell my students to be very careful when considering a new business opportunity if you are on the outside looking in with a solution to a problem you perceive to exist. An example would be for someone with software development experience in, say, customer service software who decides to develop software to automate some aspect of medical records in doctor’s offices. He or she talks to a few office managers for doctor’s offices and develops a set of features for this software based on this very limited information.
Our entrepreneur then induces a doctor’s office to be a beta site for the software and, with a great deal of hand holding, decides that the beta site was a success. This is a disaster about to happen. Usually, the doctor’s office in the beta test has not paid money to use the software and, therefore, didn’t have to consider the value versus the cost of the software product.
Inevitably, the software needs many bells and whistles to handle all the variations “required” by different doctor’s offices making it impossible to charge a price that the doctor’s offices are willing to pay that will cover the actual cost of delivering the product. The entrepreneur deceives him or herself into believing the “value-added” by using the product exceeds the price the entrepreneur must charge and the entrepreneur runs out of cash chasing a “vapor” opportunity.
Compare this to a person with some knowledge of software who works as an administrator in a large doctors’ office who sees the need for a similar product, but with a simplified set of features that will meet the need. He or she sees that the product can be developed, from the beginning, to have flexibility to handle additional features, if a doctors’ office is willing to pay for them. This person decides to team with a software developer and designs the software to meet the real needs of a doctor’s office that have subtle, but very important, differences from the needs perceived by our first entrepreneur. The bells and whistles (that often cost more to develop than the basic product and often cause more problems for the customer) are offered only as add-ons. This entrepreneur has a real chance of succeeding.
What I’ve described above happens very often. The first entrepreneur conducted a superficial analysis of the problem he or she perceived to exist and developed a product without knowing the subtle aspects of the customer’s problem that will be the difference between success and failure of the product. This often happens because of an arrogance on the part of the first type of entrepreneur who thinks he or she can understand the customer’s need and thinks he or she knows the decision making process the potential customer will use in deciding whether or not to pay money for the product.
In reviewing a business plan, I always look for a section that walks the reader through the thinking process of a potential customer in deciding to purchase the product. I very seldom find this analysis and, when I ask the entrepreneur to verbally tell me, the entrepreneur can only give me generalities that are useless. Yet, when I ask someone like the second entrepreneur described above who has had personal experience in dealing with the problem, he or she can usually give a very good explanation of the customer’s decision making process. Which of these entrepreneurs is likely to raise capital from investors?
The lesson – team up with a person with real experience at dealing with the problem you think you can solve with your product; not by simply interviewing the person, but by making the person a part of your team!
Capital Ventures
by Victor Schaffner
Vice President for Policy and Outreach, FloridaNEXT Foundation
Forget the stigma about Central Florida.
About how it begins, and ends, with tourism.
I forgot about it during the more than three hours I spent the other night at The Abbey, located in Orlando’s hip Thornton Park neighborhood. Like the dozens of others in attendance there, I instead thought of the region as a hotbed of innovation.
The Abbey played host to VenturePitch Orlando, which brought together investors and an extraordinary array of high-tech start-ups.
They included flexReceipts, which, should it attract the necessary capital, could help make paper receipts a relic. flexReceipts would convert them to digital form, providing consumers convenience and retailers data analytics that could help them better tailor their products to their customers.
A start-up called Tampa Medical Innovations wowed the audience. A simple device it developed can speedily clamp catheters, preventing blood loss and protecting people against contamination. The potential U.S. market for such a device: more than $300 million.
Judges experienced in dispensing capital – and advice that can turn entrepreneurial ideas into going concerns – took part in the event. They also reviewed a mobile app start-up geared for singles who use smart phones, a data encryption start-up that offers a cloud service that can protect and control information, and a digital media start-up that remixes TV shows into interactive apps for mobile devices.
The start-up noXaos ended up taking top honors at The Abbey. Its artificial intelligence system is designed to solve “information overload” by optimizing information generated by social media for individual consumers. Amazing.
noXaos, along with so many other impressive entrepreneurial ventures on display at The Abbey, made me forget where I was – in the heart of America’s tourism capital. The VenturePitch entrepreneurs instead made me think the drive to innovate soon could become what more and more people will come to remember about Central Florida.
Originally published on FloridaNEXT’s Blogs.
Florida IDEA Grant Program
by Justyn Engl (and Bryan Poynter)
Venture Fellows, IDEA Fund Partners
A new grant opportunity for Central Florida-based entrepreneurs and companies with potential for high growth has become available from IDEA Fund Partners - The Florida IDEAGrant Program. The program, which is starting its second year, is modeled after the successful NC IDEA grant program in the state of North Carolina. The Florida IDEA Grant Program finds and accelerates new high-growth companies in Central Florida. This program is a catalyst for technological breakthroughs developed in Central Florida that have significant potential to successfully transition into commercially viable high-growth enterprises. The grants, which are up to $50,000 per recipient, support business plan development, reduce risk of early failure, and advance projects to the point of suitability for angel or venture capital investment. In addition to the funding, winners also benefit from mentoring by successful entrepreneurs and experienced investors; use of MBA interns; access to attorneys, accountants and marketing consultants; public recognition and access to growth capital. Applications for grants will be accepted through Friday, September 21st.
Please visit www.floridaidea.org for more information and to apply.
Orlando technology startups win 3Q VenturePitch Orlando Competition
by Dennis R. Pape
Founder, Florida Venture Sourcing
VenturePitch Orlando, Central Florida’s technology startup pitch and networking event showcasing the latest technology startups in the region, announced today that Orlando startups noXaos ands flexReceipts won awards after pitching to four technology investor judges and an audience of early-stage technology founders, investors, and service providers at its third quarter event held on August 21st at The Abbey in downtown Orlando.
3Q VenturePitch Orlando showcased 6 promising early-stage companies who were selected to pitch their business plans from over 25 applying companies. In addition to noXaos and flexReceipts, Media Spurt (Orlando), Tampa Medical Innovations (Tampa), meet.com (Orlando), and NATION Technologies (Orlando) also presented. The competition was preceded by remarks on the Orlando entrepreneurial ecosystem by Orlando, Inc’s (Orlando Regional Chamber of Commerce) President and CEO Leslie Hielema and a keynote address on entrepreneurial success by Richard Licursi, longtime Central Florida serial entrepreneur and CEO and Cofounder of venVelo, a new Orlando venture fund and business accelerator focused on early stage investments.
VenturePitch Orlando’s four technology investor judges selected noXaos, an Orlando enterprise social media startup that provides an advanced artificial intelligence system for optimizing streams of information for individual consumers, as their pick for the most promising technology startup from an investor perspective. Steve Weagraff, founder and presenter for noXaos, said “VenturePitch Orlando was a fun and exciting event for us. It’s a great venue to network with investors and other technology companies. The VenturePitch Orlando team was great to work with and I highly recommend the program for any startup looking to take their company to the next level.”
VenturePitch Orlando’s audience selected flexReceipts, an Orlando digital receipts startup that enables retailers to provide digital receipts so that consumers can store and access all of their receipts in one central online location, as their favorite startup. Tomas Diaz, founder and presenter for flexReceipts, said, “It’s a privilege to have won the audience award as it reflects a real need for digital receipts in the marketplace. We enjoyed the event and are grateful for such a great forum.”
On behalf of the VenturePitch judges, Jason Rottenberg, Managing Director of Arsenal Venture Partners in Winter Park, presented Weagraff with the judge’s award, a trophy and an audience with three angel/venture capital funds: IDEA Fund Partners, Arsenal Venture Partners, and Tamiami Angel Fund.
The Audience Award, pro bono services from the accounting firm Cross, Fernandez, and Riley and the HR firm TriNet was presented to Diaz by Michael Heald of CFR and Aric Vinacke of TriNet.
“I’m happy to say that the response to VenturePitch from the Central Florida technology venture community has been extremely enthusiastic,” says Dennis R. Pape, founder of Florida Venture Sourcing, the host of VenturePitch Orlando. “Our approach of having technology investor judges provide helpful, actionable feedback to the pitching companies combined with providing an opportunity for the Central Florida technology venture community to see and connect with the newest startups in Central Florida, learn how investors evaluate pitches, and network with their peers and colleagues appears to be the key to our successful event. We look forward to hosting these VenturePitch events on a quarterly basis in Orlando to give even more startups an opportunity to showcase their technology and company.
The best way to prepare for a major negotiation
by Bill Grimm
Professor of Practice in Entrepreneurship and Negotiation at the Crummer Business School at Rollins College
All entrepreneurs need to be good negotiators. Few are. Why? Because they usually have little experience at negotiating major matters and have no training in negotiation. Negotiation skill is not intuitive, it is learned. I teach Negotiation in the Rollins MBA program and hammer into my students that the key to successful negotiation is preparation. Although there are many aspects to preparation, the one that is most important, yet usually missing, is to develop a good alternative to whatever you are about to negotiate. That is, if you are preparing to raise capital from angel investors, know what angel investors want and the terms to expect. But, more importantly, court more than one angel or angel group at a time so you can turn down an unacceptable deal . The strongest way to negotiate is to let it be known that you have an alternative deal that may be better than the deal the other side is trying to negotiate with you. Otherwise, you are negotiating from weakness and the other side will spot that weakness immediately. OK. Why doesn’t everyone do this? Because it is very difficult to develop the relationships necessary to have an angel or angel group take an interest in making an investment into your company. If you follow my advice, you have to develop at least two of these relationships in parallel and manage the process so that you have at least two potential investors or groups of investors with whom you will negotiate at the same time. But, you say, don’t all investors or investor groups ask who else is considering an investment in your company and insist that you tell them their names? Yes, this is a common practice by investors, but you have to have the courage to say you won’t disclose this information. An investor who walks away solely because you won’t tell the investor the name of the investor’s competition is an investor who will probably demand unacceptable terms anyway.
So, the best preparation for a heavy duty negotiation is to lay the groundwork to have an acceptable alternative to the deal you are about to negotiate. This takes planning and time.
