The following are some things that would be useful to outline in a presentation to a prospective investor:
Strategy
- Explain the problem and how it will be solved
- Expert opinion, peer review, explaining the validity of your business
- Proof/demonstrations
- Explain the timing to have your minimum viable product/service available
- What are the company’s top paths to profitability, ranked in order?
- Top priorities must be outlined
- Growth plan
Use of Funds
- Outline the timing and the amounts (in ranges)
- It’s preferred that an equity holder’s compensation should be delayed until breakeven/profitable event takes place
- Incentives need to be tied to performance
Financials:
- Existing income statement and balance sheet if applicable
- Budget forecast
Timeline
- Traction/progress to date?
- Milestone based funding: Capital is released as milestones are met/proven
- For example, third party verification of a a test/study
Management Team
- Explanation: why your team is the best fit for this project
- Strong references may help
- Full time focus
- History of both success and failures
- Incentives are aligned
- Skin in the game (Key managers have contributed their own capital and will delay compensation until the company is profitable)
- Compensation for founding members aren’t made until a “proof of concept” or “minimum viable product” is achieved
- Negligible conflicts of interests with disclosure
- Able to pivot/adjust/not stubborn
- Honest
- Healthy
Investment Vehicle
- Based in the US, UK, or CA ideally (ideally, the founder will be based out of one of these countries). These countries tend to have reasonable banking and legal systems
- Legal: JAMS arbitration in LA county, California with the prevailing party entitled to costs
Reporting
- At least quarterly reports (sufficient) by email
Risks:
- Please explain your track record: Why/how have your past projects succeeded/not succeeded?
- Please analyze:
- Strengths
- Weaknesses (eg. Knowledge, Capital, Human resources)
- Opportunities (ie. What markets can be entered?)
- Threats (eg. Competitors/Substitutes)
- Regulatory/compliance issues?
Offering
- $X Cash in exchange for Y equity