Subject line: [Flawless Financials] Fundraising Action Plan Flawless Financials the Financial Forecasting Online Newsletter from Minotaur Financial and David Brode November, 2003 Sent monthly to over 400 subscribers. Please pass on Flawless Financials to those in your network. To leave Flawless Financials, follow instructions at bottom. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * This month: Fundraising Action Plan * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * If you're trying to raise funds, you will need to develop a fundraising action plan. The last few newsletters have focused on specific skills or ideas, but at some point you need to take action to get the money. Robert Middleton (www.actionplan.com) is a master of implementing well- considered plans. This newsletter explores fundraising through Middleton's six-step planning process. You Don't Need to Figure it All Out Now Just as you may have different strategies for your business, you may have multiple fundraising strategies. You don't need to have the whole plan in place before you implement it. I've found that an incremental approach works best; design and implement one strategy at a time, then move on to the next. When you have the kinks worked out, and the strategy is producing results, you add another strategy. After a while, you can have several fundraising strategies working for you all at once. The Six Steps The six planning steps are: 1. Purpose, 2. Intended Results, 3. Components, 4. Information and Skills, 5. Actual Deliverables, and 6. Timeline. Steps 1 and 2: Purpose and Intended Results ("Eye on the Prize") The purpose of pursuing a fundraising strategy is not simply to get the money. Yes, this is a key result which is somewhat down the road. The purpose of fundraising is to get the capital needed to move the company from A to B—and ultimately to C. The purpose is to hit the milestones you're promising to investors. It's important to keep your eyes on the ultimate goal if you're to stick through a lengthy and difficult process. The intended results of the fundraising process are not limited to bringing in a big bag of cash. It is good to define the result clearly, e.g. "raise $2.5M by 3/31/04". You may want to define interim results, which could include the number of times you give your pitch, how often you present to groups that could actually fund your company, getting a certain kind of reaction, and so on. Big successes are built on smaller ones. Step 3: Components The components of your fundraising strategy may include investor materials, identifying investors, and developing a methodology for approaching investors. Each component needs to be outlined in detail. For example, the components of a financial package in the investor materials might include the following: a 5-year forecasting model, a one-page financial summary, a page or two for the PowerPoint deck, and a conceptual overview of the business model's economics. Step 4: Information and Skills This is what you need to learn before your strategy can be put into place. Learn what investors are looking for, how to find the appropriate parties, and how to make a successful pitch. This is the part where you'll need to research, study, or get some outside assistance. Increasingly, I spend a decent amount of time educating clients on how the process works, how to present their company most effectively, and who to pursue. Of course, I still spend the majority of my time with clients creating persuasive financial forecasts, but for each deal I check if the deliverables "look right" and make sure the entire package is coherent. Step 5: Actual Deliverables This may be a PowerPoint deck, executive summary, business plan, financial package, elevator pitch, and so on. After all is said and done, you need to put most of the time and effort into actually creating various documents to put your strategies into action. For the financial package, the deliverables may include the Financial Summary, PDF files of detailed model printouts, a working financial model, a short speech about the business model, and a review of all financial-related information in the PowerPoint deck or executive summary. Step 6: Timeline This is the order in which you will do things to implement your strategy. It includes action steps along a timeline. Your action plan might start with research into fundraising trends in your industry, meetings with associates, developing a contact approach, setting up one-on-one meetings, and follow-up steps. Within the context of developing investor materials, you might first focus on the Single Customer Model/Business Model before developing a multi-period Revenue/COGS/Capex forecast. Get Started Planning is a creative process; it's about designing your business the way you want it to be. You can draft the plan for a particular fundraising strategy on a yellow pad (or using PostIt notes) in just a few minutes. Start now. Until next month, all the best, David Brode – Minotaur Financial Removing Financial Issues as a Deal Roadblock * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * This newsletter was inspired by Robert Middleton's November 4, 2003 newsletter. Parts are direct quotes; other parts are liberally construed. Full attribution: Parts written by and other parts inspired by Robert Middleton of Action Plan Marketing. Please visit Robert's web site at http://www.actionplan.com for additional marketing articles and resources on marketing for professional service businesses." * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * NEWSLETTER ARCHIVE AVAILABLE Make sure to visit the Minotaur Financial website for the Newsletter Archive at http://www.brode.net/resources/ * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * http://www.brode.net mailto:David@Brode.net 1919 14th Street, Suite 510 Boulder, CO 80302 (303) 444-3300 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ABOUT DAVID BRODE I’m a financial modeling specialist. Over the last fifteen years I’ve completed dozens of models and certainly thousands of versions to support corporate development, M&A, strategic planning, and debt and equity transactions. These models have raised over $1B in debt and $100M in venture capital and private equity. Over time I’ve consistently revised software tools and work processes to get the job done quickly and well. If you have a financial forecasting issue, I’d love to help. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * (c) 2003 Minotaur Financial, All rights reserved. You are free to use material from the Flawless Financials newsletter in whole or in part, as long as you include complete attribution, including a live web site link. Please also notify me where the material will appear. The attribution should read: "By David Brode of Minotaur Financial. More articles on financial forecasting can be found at http://www.brode.net " * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Are you struggling to convince others to do a deal which you think is a no-brainer? To discuss how you can take numbers off the table as a deal roadblock, call (303) 444-3300. I'm very accessible and glad to help. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * DO YOU LIKE THIS NEWSLETTER? You are welcome to share this email with colleagues who would benefit from better numbers. Your feedback is always welcome and appreciated. Write in to mailto:feedback@brode.net. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * PRIVACY POLICY: I never rent, trade, or sell my email list to anyone for any reason whatsoever. You'll never get an unsolicited email from a stranger as a result of joining this list. To SUBSCRIBE FREE to this newsletter, send an email to mailto:subscribe@brode.net. And you'll get Minotaur's Financial Forecasting White Paper in the deal. To be REMOVED from this list, send an email to mailto:remove@brode.net. (Please note that this message needs to come from the email address that originally subscribed. If you need help determining this, please email mailto:David@Brode.net.)