Venture Capital Handbook: An
Entrepreneur's Guide to Raising Venture Capital, Revised and Updated Edition, 1/e
Back Cover Copy
The Classic Handbook To
Raising Money for Your New Venture.
The complete insider's guide
to venture capital funding!
Looking for venture capital
funding? The money's is out there. But you'll need to work harder to secure financing
today and work a whole lot smarter, too. That's where Venture Capital Handbook: Revised
and Updated Edition comes in. In this book, leading venture capitalist David Gladstone and
Laura Gladstone take you step-by-step through the entire VC funding process explaining
exactly what you must know to get funded.
- The
practical, "nuts and bolts" guide to today's venture capital marketplace
- How
VCs really work and how to make your company stand out as an investment opportunity
- How
to accelerate the investment process and eliminate dead-ends with the wrong funds
- Building
an effective long-term relationship with your VC partners
- Reflects
massive changes in the Internet and technology funding environments
- Covers
key changes in the tax law that impact both investors and companies
Venture Capital Handbook:
Revised and Updated Edition is an end-to-end update of the classic insider's guide that
has helped thousands of companies get funded successfully. If you're working to transform
your dream into reality, this is the one book you simply must read.
Web Online Copy
In Venture Capital Handbook:
Revised and Updated Edition, leading venture capitalist David Gladstone and Laura
Gladstone walk you step-by-step through the entire VC funding process, showing exactly how
to get funded fast without the trauma. This end-to-end update of the classic VC
guide covers the latest techniques, tax rules and, above all, marketplace realities.
Author Bio
DAVID GLADSTONE, one of
America's leading venture capital executives, serves as Chairman of Gladstone Capital
Corporation (NASDAQ: GLAD). He has more than 25 years of experience making investments in
small and medium size businesses. Until 2001 he was Chariman of American Capital
Strategies, a billion-dollar LBO fund. Before that, Gladstone was Chairman and CEO of
Allied Capital a large venture capital fund, joining that fund when it had only $9 million
in capital, and grew it to over $750 million in assets. He is author of Venture Capital
Handbook and Venture Capital Investing (both Prentice Hall PTR). Gladstone holds an MBA
from Harvard Business School.
LAURA GLADSTONE, a principal
with Gladstone Capital Corporation, has more than 10 years' experience investing and
lending to businesses. Prior to joining Gladstone Capital, she was with HSBC as a loan
officer and with ING Barings as a analyst. She was also with Allied Capital Corporation.
Table of
Contents
Introduction.
Acknowledgments.
1. Anyone Can Raise Ventura Capital.
I'll Back You. What Is
Venture Capital? When Did Venture Capital Begin? Types of Venture Capital. Where Can You
Find Venture Capital? How Do Venture Capital Companies. What Types of Business Do VCs
Back? Which Industries Do Venture Capitalists Prefer? What Types of Products or Services
Do Venture Capitalists Prefer? How Much Venture Capital Is Available? Opportunities
Available for Entrepreneurs. Can You Raise Venture Capital? How Much Money Should You
Seek? What Type of Funds Are You Seeking? How Will the Venture Capitalist Be Involved? How
to Select a Venture Capital Company. Should You Phone the Venture Firm? Other Questions
for the Venture Capitalist. How Long Does It Take to Get the Money? Myths About Venture
Capital.
2. Summary Presentation.
What Does a Summary Look
Like? Why Is the Venture Capitalist Interested? How to Complete a Summary. Type of
Business. What Kind of Cover Letter Is Needed? Strategic Use of Summary. Another Kind of
Venture Capital. Perspective for Your Summary. What Do Venture Capitalists Think About
Summaries? Confidentiality of Your Great Idea. Objective.
3. The Proposal.
Should You Use a Broker or
Consultant? Most Important Quality of a Business Proposal. Do You Really Need All of This?
What Is the Venture Capitalist Really Looking For? How to Package Your Proposal. How Many
Venture Capitalists Should Be Contacted? Syndication's. Objective.
4. A Thousand Questions.
What Are the Major Questions?
Business Proposal Questions. Other Information the Venture Capitalist Will Need. Will the
Venture Capitalist Ask All These Questions? Objective.
5. Meetings and Negotiations.
The Office of the Venture
Capitalist. What Do Venture Capitalists Look Like? How Long Will the Meeting Last? What Is
the Object of the Meeting? What Happens in a Typical Meeting with a Venture Capitalist?
What Type of Presentation Should Be Made? What is The Primary Characteristic the Venture
Capitalist Is Seeking in an Entrepreneur? What Are the Other Characteristics of the
Entrepreneur? Know Your Stuff. Things You Do Not Say to the Venture Capitalist. Things Not
to Do in the Meeting. How to Negotiate in the First or Subsequent Meetings. How to Cut the
Deal. Ownership by the Venture Capitalist. How Do Venture Capitalists Price Investments?
Downside Risk. After the Negotiations. Objective.
6. The Commitment Letter.
Commitment Letters. What Is
In the Commitment Letter? Comments on the Commitment Letter. What Is An Investment
Memorandum or Term Sheet? Consulting Agreement. Nonlegal Commitment Letter. Arguing Over
Minor Points. Items You Should Not Sign in the Commitment Letter. Objective.
7. Due Diligence.
What to Expect From a Visit
to Your Business. How to Give a Good Cook's Tour. Investigating the Individuals. Venture
Capitalists Are Paranoid. Other Aspects of the Background Check. Do They Have a Test for
Entrepreneurs? Experience Is the Watchword. Investigating the Entrepreneur and the Team.
Questions for Other People in the Organization. Investigating the Business, the Product,
and the Industry. When the Venture Firm Finds Something Wrong. Questions for the Venture
Capitalist. Background Information on the Venture Capital Company. Timing Questions for
the Venture Capitalist. Objective.
8. The Closing.
First Closing: Legal
Documents For Loans With Options. Simple Is Good. Unethical Venture Capitalist. Second
Closing: Legal Documents for the Purchase of Preferred Stock. Lawyers as Businesspeople.
Experienced Lawyers Are Best. Legal Fees Keep Going Up. How Lawyers Run Up Your Legal
Bill. Syndications and Lawyers. The Closing: A Moment of Truth. Closing Fees That You Pay.
What to Remember About Lawyers. Objective.
9. Working Together.
Major Policy Decisions Should
Be Joint Ones. Monthly Financials. Hold Board or Investor Meetings at Least Monthly. Other
Discussion Items for the Venture Capitalist. You Are Building Confidence. Warning Signals
to the Venture Capitalist. Why Entrepreneurs Have Financial Problems. Why Entrepreneurs
Have People Problems. The Protean Entrepreneur. When You Have Problems. Analysis of the
Situation. What the Venture Capitalist Will Do. Ten Things Not to Say. Secret of a
Successful Relationship. Venture Capitalist as Board Member. Degree of Involvement by the
Venture Capitalist. Objective.
The Exit.
It's All a Matter of Price.
First Method: Going Public. Second Method: Purchase by the Company or Entrepreneur.
Purchase by Employee's Stock Ownership Trust. Exit by Puts and Calls. Third Method: Sale
of the Company to Another Company. Fourth Method: Finding a New Investor. Fifth Method:
Liquidation of the Company. Negotiating with the Venture Capitalist. Objective.
11. Using Brokers.
Accountants: How to Use Them.
Investment Bankers: What They Can Do. Lawyers: Are They O.K. as Financial Brokers?
Independent Financial Brokers: What Do They Want? Qualities to Look for in a Broker.
Agreement with the Broker. Some Tips on Dealing with Brokers. Amount and Type of Fees. Who
Should Present the Plan to the Venture Capitalist? Objective.
Advice From Us to You.
Keeping Up With Venture
Capitalists. Selecting a Venture Firm. Venture Capital Process. Venture Capitalists as
Human Beings. Problem Companies Looking for Financing. Financing for Your Job or Your Ego.
Too Much Information. Do You Understand Credibility? Ten Commandments for an Entrepreneur.
Parting Shot.
Glossary.
Actual Documents.
Commitment Letter. Legal
Document 1. Legal Document 2. Legal Document 3. Legal Document 4. Legal Document 5.
424 pages