Monthly Archives: October 2014

Rocket Growth in Venture Investment Activity for 2014

Rocket Growth with Venture Capital from The Startup Garage

Rocket Growth in Venture Investment Activity for 2014

Rocket Growth in Venture Investment Activity for 2014

Look at the data, and you’ll go “Wow.” According to TechCrunch, Forbes and other sources venture capitalist investments are shooting through the roof. Investments in new startups rose to almost $6 billion, up from $3.5 billion for the same period last year. This could mean that venture capitalists are optimistic for startup investing this year.

In fact, some capitalist believe 2014 will be the year to beat all years when it comes to venture capital for young startup companies, despite the concerns of some finance industries and professionals in the first quarter of the year. This is the message delivered by many venture groups throughout the nation.

According to Forbes Magazine, this year will be a good one for young startup companies needing to raise money. These predictions are not unfounded. They are based on the nationwide increase of venture capital funding; an increase of 7% over the $29 billion in funding distributed last year.

What Does The Future Hold?

In 2014, corporations, financial gurus and VCs expect to see more venture investment and higher investment returns. This is higher than the 43% increase we saw in 2013. Most investors believe there will be a substantial improvement in funding, and they foresee higher company valuations for startups.

Where is the Money Going?

Successful startup CEOs and venture capitalists expect certain types of startups to be preferred over others. Those that offer products in business IT, Consumer IT and Healthcare IT are thought to be of more interest to venture capitalists. By the same token startups in areas such as clean technology, medical devices and biopharmaceuticals may see a decrease in funding opportunities. However, this doesn’t mean the startups on the downside of the chart have no hope of getting funding. It just means they need to hone their strategy. Put their business in a favorable light and show investors why this startup is innovative, creative and a good investment.

Hope and Reality

Though the first quarter of 2014 shows an optimistic outlook for venture capital funding, it’s still a little early in the year to make a strong determination. Expectations of higher valuations, improved IPO and increased startup funding would benefit the consumer, the economy and the startup, and increased optimism may attract more investor interest, but real statistics are still in the waiting.

Increasing the Chances of Finding Venture Investment

Of all the avenues available to raise capital, venture capitalist funding is the toughest. Even so, startups often record this avenue as the most successful. But before you take your business idea to a VC you must have an idea or business that offers a strong profit potential. Venture Capitalists are interested in profit – and they often expect a return of about 35% per year.

VCs are tough and they have stringent rules, so you need to be prepared – and you need the right mindset. Always keep in mind that these are professional investors who know the ropes. They need to know why they should give a damn about your specific proposal.
As a startup, placing a proposal in front of Venture capitalists you must be prepared for both success and failure.

Social Media A Startup Must-Have

5 Reasons Why Social Media Is Key For Startups from The Startup Garage

Social Media A Startup Must-Have

5 Reasons Why Social Media Is No Longer Optional For Your Startup Business

Reason #1) Have you heard of a Website?

Does your Startup business have a one?
Chances are unless you’re stuck in 1994, it’s fair to say any successful business on and offline has a website.
Social Media Platforms are the WWW.’s for a new generation.
A generation of people, who know the power of the World Wide Web, and value instant connectivity both locally and globally.

Reason #2) “Your network is your net worth”

Well, what if your network was endless? We’re talking Billions of people Network/Networking just fingertips away.
Individuals exchanging key Resources, Connections, and Knowledge.
Investors, Advisors, Customers, Partnerships and even your Competition… all-waiting for someone to strike up a conversation.

Reason #3) Brand Equity

Behind any successful Startup there is a well-cultivated brand.
Wikipedia said it best, “Brands are one of the most valuable assets a company has.” The consumer’s perception of a brand increases both financial and market appeal. Social media provides the ultimate stage for a Startups brand personality to develop. As well as a massive instant audience ready to grow, evolve and help mold the business.

Reason #4) Startups = Innovation

As a Startup company it’s essentially your social responsibility to stay on top of technology and cutting edge trends. You are The Early Adapter, The Visionary, and The Magician, who predicts and creates the future for the rest of us. Social Media tops the technology and trend lists, providing a turnkey foundation to build Startup empires.

Reason #5) “Like” it or Hate it, Facebook, Instagram, Google+, Twitter, LinkedIn and others are our present and future.

The names and features might change, but their presence and influence in our lives are unavoidable.
 

Have questions? Feedback? Intrigued?
Tweet us @Startup_Garage We’re happy to help.
 

Whether you have a question about your Startup or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

The Entrepreneurial Advisory Council

The Entrepreneurial Advisory Council

The Entrepreneurial Advisory Council hosted its first workshop.

The event titled, “Making Your Startup Investor Friendly” took place on Wednesday, October 8th 2014 in San Diego, CA.

The Entrepreneurial Advisory Council is a group of professionals that serve San Diego’s growing number of innovators, entrepreneurs, and startup businesses.

The council’s expertise includes legal, financial, capital formation, and business planning services. The common thread among all members of the Entrepreneurial Advisory Council is their commitment to building meaningful connections that lead to successful business ventures.

Michael Acheatel, the President of The Startup Garage, is one of the Council’s co-founders and was a speaker at the event. His presentation focused on the milestones that investors care about at each stage of the funding and milestone timeline. He took the audience through the 7 major categories of startup milestones – business planning, team building, market traction, legal, operations, product development, and founder leadership – and highlighted how these milestones evolve throughout each round of funding. He specifically focused on the early stages of funding from friends, family, and founders as well as angel investors.

Michael was followed by his fellow co-founders of the Entrepreneurial Advisory Council – Hass Sadegi, Rob Domingue, and Joseph Erle. Hass is the Principal Owner of Sadeghi Legal and offered his advice on how and where to legally structure your startup as well as how to avoid exorbitant lawyer fees down the road based on appropriate planning in the early stages.

Joe is an insurance broker with 5th Ave Insurance and spoke about the types of insurance that investors require and how to reduce risk for the company.

Rob is the Director of Transcend Valuation and spoke about valuation and how to both create and determine value in a company.

Lastly, the panel opened up to a Q&A session where they received several excellent questions from the audience.

With good food, a great audience, and 4 experts with unique insights on what investors like to see in a startup, the event was deemed a complete success.

The Entrepreneurial Advisory Council will host a workshops once every quarter in San Diego.

Whether you have a question about your Startup or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!

What’s The Best VC Pitchdeck?

Venture Capital Pitch Deck from The Startup Garage

What’s The Best VC Pitchdeck?

What’s The Best VC Pitchdeck?

Don’t live your life impressing others. Live your life impressing yourself.

The above is an interesting quote that relates to many aspects of life and business, especially when pitching your startup to the venture capitalists.

The best pitch deck comes from the heart; it’s not one created for the benefit of venture capitalists. It is for yourself, an outgrowth of the startup business you’re raising.

When you prepare your company’s business model for the VC pitchdeck, pay attention to the details:

  • Make it eye catching
  • Demonstrate your passion for your business
  • Make it compelling
  • Make it concise and to the point
  • Demonstrate the urgency of getting this deal done. Show the VC why it benefits him (not you) and if he doesn’t go with the deal, make sure he understands someone else will.

Your VC pitch deck needs to be a great snapshot of your business.


What You Need To Know

As an entrepreneur seeking investment, you will be asked to present a detailed financial model.
A financial model that demonstrates and explains all of the possible assumptions behind the numbers.

This financial model is the key to your getting the funding you need. It is a tool you use to show your real perspective to investors. Your financial model needs to be more compelling than the average run of the mill catalog financial model.

How to Prepare Your Financial Model

Think of answering these core elements when preparing for a funding round:

  • Assumptions that a VC could make.
  • P&L Marketing
  • Balance Sheet
  • Key Forecasts
  • Metrics

Cover These Vital Elements in Your Presentation

You must do your homework and cover these areas as they relate to your particular heading.

  • Your Market Size
  • Projected Growth of the Market
  • The Way in which Your Business Meets Your Client’s Unmet Needs
  • The Value Your Business Offers
  • Market Competition
  • Strengths and Weaknesses of Your Business
  • Business Model
  • Metrics
  • Financial Model
  • Historic Outline of Your Business
  • Future Timeline
  • Return Options
  • Risks
  • Exit Strategy
  • Your Team

Actions Speak Louder than Words

Keep in mind that VCs want to see your past, current and future actions. These are key elements that speak to them. They don’t want to hear the fluff. Show them a detailed financial model that tests their assumptions. Show them how your startup is going to make them money.

What Are the Assumptions a VC May Have?

A VC will always make assumptions. That’s the way he forecasts the possibilities for investing in the business. Use historical data to base your future growth assessments on reality.  Use metrics that demonstrate the number of users for your service or product, the amount of money you generate for each user, new types of revenue and other data that pertains to your business.

Short Term and Long Term Cash Strategies

A VC wants to know about your cash administration. He wants to know how you are going to manage your finances and the potential funding raised.  Effective cash flow strategies ensure you keep enough cash on hand to meet the business financial obligations. These include payroll, suppliers, customers, loans, inventory and expenditures.

What Happens Afterwards?

When and if you do get VC funding your business and financial models don’t sit idly by. You and your management team need to work and improve these models constantly. They serve as a guide for your business as it develops. Your performance will be judged according to your initial forecasts.

 

Whether you have a question about you investing or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!