Mark Peter Davis writes about startups, raising venture capital, scaling companies, and two-sided markets.
HN commenters link his posts as a collection on starting a company and on data synergy and raising capital. One asked for more evidence behind his VC advice.
Are you going for venture capital or an angel investment? The level of documentation and requirements will be similar, but at the angel level the chips are stacked more in your favor as far as getting meetings and investment. Angels are not going to expect a minimally viable product or traction as much as VCs will.
A few sites to check out:
http://www.venturehacks.com
http://www.markpeterdavis.com/
Every VC is going to be different in what they want and don't want to hear/see. Remember going in that the odds are against you. To increase those odds you can show traction in the market, and at minimum a working product (even if it is not the final product).
Angels and investors are going to want to know about your background (i.e. school, previous work, and any startups you have done in the past).
Essentially it is a dog and pony show where you have to prove to them that you can execute on a product and make a return on their money. While a return is not always going to happen, the more comfortable they are with you, your product, and the chances of making a return on their investment the better off you are.
Get a lawyer, one who is experienced in raising outside investment. There are laws that you must follow when seeking outside investment and having someone familiar with the process is essential. Be ready to spend some money on the lawyer (most lawyers will work with the intent to take their fees off the top of the funding when finalized).
The final thing is it takes…
citation please? While this is sweet kool-aid, and I like the taste a lot, this is in direct opposition to almost all VC websites that I have read.
I expected this answer, posting here. I WANT this answer. But I need more. I need convincing that the VC sites are wrong.
Here's links from a one minute google.
http://www.smallbusinessnotes.com/financing/venturecapitaldecisions.html
http://www.markpeterdavis.com/getventure/2008/08/hi-mark-big-fan.html
http://209.85.173.132/search?q=cache:HQ8zeI6-mXUJ:www.va-interactive.com/inbusiness/documents/MAN_VC1.doc+%22management+team%22+vc&cd=5&hl=en&ct=clnk&gl=us
... and so on. I have a bookmark folder filled with these somewhere, but for now, you get the idea.
Good VC firms generate positive returns from more than half of their companies. Even the average VC generates positive returns from 1/3. This is from a large sample: http://www.markpeterdavis.com/getventure/2008/09/vc-backed-start.html
Bad VC firms, on the other hand, can achieve 100% failure rate. It's not some throw of the dice, it's about (a) choosing the right investments, and (b) making them succeed. If they're telling you that it's normal for the vast majority of their investments to fail, find a better place for your money (and don't taken money from them either.)
is this the article you're referring to? http://www.markpeterdavis.com/getventure/2010/09/data-synergy-scaling-information-companies.html
Correct link: http://www.markpeterdavis.com/getventure/2009/12/catch-22-you-dont-have-barriers-until-you-scale-can-you-raise-capital.html
Mark Davis' Blog has a collection of posts about Starting up
http://www.markpeterdavis.com/getventure/starting-your-company.html