Several False Propositions In Venture Capital Financing

Since the start of business in 2007, VC has seen many of them. Many of them have learned a lot during the negotiation with these experts. At the same time, they have known many entrepreneurs in the same class. Everyone is in a hurry to start their own business. But in conversation, I feel that many friends are easy to fall into a few false propositions. I am here to give a few false propositions on venture capital financing, hoping to learn from friends who are preparing to start a business or preparing for financing negotiations.

1, "my business model is very NB, the average person is not easy to copy!

"A lot of cowboys and men, if you see VC, come here first!

Congratulations, what you said just happened to be your reason.

VC is most afraid of someone saying that his own business model is the only creation in the world.

Because this often means that your business model is very complex, and most people do not understand it (of course, it is not easy to copy).

In this world, simple is beautiful.

Let's look around. Great companies are the simplest models.

Don't talk about it. Business is buying and selling.

All you need to do is to figure out how to provide things that satisfy your customers' needs, whether you sell cabbage or sell software.

Let's take a counterexample. We have a republic network in Hangzhou. Until now, few of them understand what they are doing.

2, "give me 1 hundred million, next year, you 1 billion" "maybe" now RMB is not worth, some people see VC or investors say, as long as I have money, my business can succeed immediately.

This is a real bullshit!

We should think about it. Can we manage 100 million of our capital now?

I'll give you 1 hundred million tomorrow. How do you spend it?

10 million buy a server?

10 million pay?

The remaining 80 million advertising!

Well, I've seen quite a few of these BP.

When we are financing, we really need to sort out our ability to control cash flow. At least, we should make three statements according to the real situation of the market (cash flow statement, profit and loss statement, balance sheet).

If you don't understand the three statements, I suggest you don't go to the investors first.

In BP, the financial control ability is highly valued by investors.

3, "the technology of our team is the first in the world." you can rest assured that you are not the smartest person in the world!

Technology maniac does not mean that you are the bull in the market!

The barriers to technology are of course important, but more importantly, technology should be in line with the market.

In the course of starting a business, even if your initial technical ability is international, it does not mean that you are always in the lead.

In this world, it's good to be ahead of others for 6 months.

The key is the comprehensive management ability of the team, technology is only one of them; 4, "100 billion of the market, we can only be listed as long as we can occupy 10%."

But the question is, how do I know you can eat?

When you start a business, don't be greedy. First, think about the pessimistic situation. Why can't you be smart if someone else can't eat this market?

Can anybody else eat it?

There is no unique, original and disruptive business model in the world!

There are hundreds of websites similar to Alibaba in the same period. Why is Alibaba only successful?

Team's comprehensive ability, persistence and luck are the key to success.

Before starting a business, first polish up your team's ability, prepare for the 8 years' War and prepare for the contingency, so that you won't be knocked down by reality.

Xu Qiyun, editor in chief: