Healthcare Informatics and Technology Investors
Healthcare Informatics and Technology Investors


About Team Role Theory

History & Research

Reliability & Validity

Dr. Meredith Belbin

Behavior vs. Personality



10 Tips for Entrepreneurs

So you have your business plan together and a prototype that will change the world. Now all you need is $3 million to get your idea off the ground. We asked Stewart Flink of Dillon Capital LLC to give his list of top things to keep in mind when asking a venture capitalist for money.

Is there a good fit? Look for a VC that's focused on your industry and look for a personality match. Find out if they do early stage ventures or are more likely to invest in something after there are revenues and customers. Every firm has different criteria for investing.

Do they offer more than cash? Don't just look for money. Seek a VC with principals who have operating experience and who can help recruit management talent. Also be sure to consider how many board seats they may want and whether you would want them on your board. Can you live with them over the long term?

Do your homework: Do extensive due diligence on the VC firm and the principals with whom you are meeting. Has the VC invested in companies in your geographic location? VCs like concentration among their portfolio companies so they can make better use of their time when they come for board meetings or visits. Don't ask questions that you could have found on the VC's Web site.

Does the shoe fit? Make sure the VC fund's investment-size requirements match the amount of funding you seek. Consider whether you should fund with angel investors on early rounds and then go to a VC on a later round when more capital is required.

Do a reality check: Be realistic with your valuations, and get feedback from people you trust and respect, such as your accounting firm. Don't look at public company valuations and they extrapolate your valuation based on what your projections will be in a year or two relative. Also, don't value your company based on what you want to own after your current round of financing.

Put yourself in their shoes: VC's might see hundreds of business plans a month, so don't send an 80-page plan unless they specifically ask for one. If they ask for some information prior to the meeting, an executive summary would probably be sufficient.

Know your strengths and weaknesses: Take the time to identify and disclose your weaknesses as well as emphasize your strengths. No company has all of the answers, and typically the issues revolve around completing a management team, marketing dollars, building a board of directors, etc. VC's want to know that entrepreneurs have a realistic view of themselves and their competition.

Be a proficient presenter: Be able to present your entire concept and company in 30 minutes or less, and make sure you have practiced several times in front of people that can give you honest feedback. Have a financial person in the meeting with you, particularly if they had a hand in the financial projections that a VC may be evaluating. Make certain there are no flaws in the technology you are using to present your company.

Plan an Exit: It's hard to have a perfectly planned exit strategy in the real world. However, no VC wants to have its money tied up indefinitely. The VC will want to know that you are approaching this venture as a money-making opportunity and is likely to consider the thought process you've applied to an exit strategy.

Attitude is everything: Have fun and be excited about your prospects and your company. You have to sell an idea to someone who sees many people like yourself daily. Be professional. Don't take yourself too seriously.

Stewart R. Flink is managing director of Dillon Capital, LLC, a Chicago-based venture capital fund