Free Venture Capital Firm Business Plan
For Raising Capital from Investors, Banks, or Grant Companies!
Please note that the financials
in this complete free business plan are completely fictitious and may not
match the text of the business plan below. This free business plan demonstration
purposes only. If you are interested in purchasing the completed editable MS Word
and Excel documents for this business plan, please click the button below! Also,
the text of the business plan is formatted with a fully automated
table of contents.
It should be noted that there is no special software required to use these
templates. All business plans come in Microsoft Word and Microsoft Excel format.
Each business plan features:
- Excecutive Summary
- Company and Financing Summary
- Products and Services Overview
- Strategic Analysis with current research!
- Marketing Plan
- Personnel Plan
- 3 Year Advanced Financial Plan
- Expanded Financial Plan with Monthly Financials
- FREE 30 Page Sample Private Placement Memorandum
- FREE PowerPoint Presentation for Banks, Investors,
or Grant Companies!
1.0 Executive Summary
The purpose of this business plan is to raise $10,000,000 for the development of a venture capital firm while showcasing the expected financials and operations over the next three years. Venture Capital Firm, Inc. (“the Company”) is a New York based corporation that will provide investments into startup and expanding businesses throughout the United States. The Company was founded by John Doe.
1.1 Products and Services
The Venture Capital Firm will specialize in making private investments into companies that show great promise in regards to revenue growth and the Venture Capital Firm’s ability to take these businesses public (or divest them through private sale) to third parties throughout the United States. Specifically, the Venture Capital Firm will focus on making investments into new businesses that having promising technology, an innovative business concept, or are existing businesses that are seeking rapid growth within their field. The Venture Capital Firm will generate revenues by levying fees equal to 2% of the aggregate assets under management coupled with a 20% incentive fee on all profits generated by the business, The third section of the business plan will further describe the services offered by the Venture Capital Firm.
1.2 The Financing
Mr. Doe is seeking to raise $10 million from a number of investors via a private placement offering that will be used to make investments into third party companies. The business will use a number of limited partnerships in order to effectively make investments into subsidiary businesses that hold a significant amount of promise.
1.3 Mission Statement
The Venture Capital Firm’s mission is to provide potential investors to access to fast growing companies that can provide substantial capital appreciation over a three to five year period once the VC firm divests its interest in the businesses that invests.
1.4 Mangement Team
The Company was founded by John Doe. Mr. Doe has more than 10 years of experience in the venture capital industry. Through his expertise, he will be able to bring the operations of the business to profitability within its first year of operations.
1.5 Sales Forecasts
Mr. Doe expects a strong rate of growth at the start of operations. Below are the expected financials over the next three years.
1.6 Expansion Plan
The Founder expects that the business will aggressively expand during the first three years of operation. Mr. Doe intends to implement marketing campaigns that will effectively target investors and companies seeking investment within the target market.
2.0 Company and Financing Summary
2.1 Registered Name and Corporate Structure
Venture Capital Firm, Inc. The Company is registered as a corporation in the State of New York. All shares of investments will be held through limited partnerships arranged by the Company.
2.2 Required Funds
At this time, the Venture Capital Firm requires $10 million of investment funds funds. Below is a breakdown of how these funds will be used:
2.3 Investor Equity
Mr. Doe is seeking to raise capital via the Company’s private placement memorandum. He will retain a 100% ownership interest in the investment management company that will oversee the firm’s venture capital investments.
2.4 Management Equity
This will be further discussed in the Company’s private placement memorandum.
2.5 Exit Strategy
If the business is very successful, Mr. Doe may seek to sell the business to a third party for a significant earnings multiple. In all likeliness, a qualified investment bank would be hired to manage the complex aspects of selling the Venture Capital Firm to a third party for a significant earnings multiple. We encourage you to review the Company’s PPM in regards to the potential sale of the Venture Capital Firm to a third party investor.
3.0 Products and Services
Below is a description of the venture capital investment services offered by the Venture Capital Firm, Inc.
3.1 Investments into New Businesses
The primary revenue center for the business will come from capital appreciation and dividends tied to investments in new businesses, innovative startup businesses, and existing businesses that are seeking expansion capital. The center of this revenue unit will come from the capital appreciation that is realized when a business in which the Venture Capital Firm has a stake is sold privately or via an initial public offering. The business will hire number of highly educated investment professionals that can provide insight into the economic viability of any business that is reviewed by the Venture Capital Firm for a potential investment.
3.2 Royalty Based Financing
The business will also make royalty based financing investments into new businesses within the intent to generate revenues both from capital appreciation as well as guaranteed payments based on the revenues of the business in which the Venture Capital Firm provides capital. This is a new and innovative form of financing that substantially reduces the risks associated with venture capital investing. A full royalty based financing model is accompanied with this business plan.
4.0 Strategic and Market Analysis
4.1 Economic Outlook
This section of the analysis will detail the economic climate, the venture capital industry, the customer profile, and the competition that the business will face as it progresses through its business operations. Currently, the economic market condition in the United States is moderate. The meltdown of the sub prime mortgage market coupled with increasing gas prices has led many people to believe that the US is on the cusp of a double dip economic recession. However, the Venture Capital Firm should be able to continue to realize substantial profits from its investments as many of these companies’ revenues are not dependent on the ongoing economic climate.
4.2 Industry Analysis
Within the United States, there are 1,000 registered investment companies that specifically engage in the activity of providing early stage growth capital to new and existing businesses. At this time, there is approximately $600 billion invested directly in venture capital companies and venture capital limited partnerships. There are approximately 25,000 people working within this industry. The venture capital industry has recently undergone some legislative changes in regards to the individuals operating Venture Capital Firms. Any manager of pooled funds who is overseeing more than $25 million is now required to be registered by the Securities and Exchange Commission. However, the requirements regarding accredited investors has not changed.
4.3 Customer Profile
The Venture Capital Firm will not directly have customers. The business intends to solicit a substantial amount of capital from wealthy individuals, pension funds, insurance companies, and other investment companies that specialize in venture capital. As such, the customer profile will generally be equivalent to the requirements set forth by the rules regarding private placement memorandums.
4.4 Competitive Analysis
As stated above, there are approximately 1,000 firms that are dedicated to providing financing to new businesses and innovative startups. As such, it is hard to quantify the competition that the business will continue to face as it progresses through its operations. However, the Venture Capital Firm intends to maintain a competitive advantage via its royalty based financing programs that produce immediate returns for the business once a portfolio company becomes profitable.
5.0 Marketing Plan
The Venture Capital Firm intends to develop a marketing campaign that will attract both investors and potential investment companies to the brand name of the firm. Below is an overview of these strategies.
5.1 Marketing Objectives
• Remain within the letter of law regarding the advertisements and marketing campaigns carried out by the Venture Capital Firm.
• Develop a strong presence among other venture capital firms and funds of funds.
• Develop relationships with private placement brokers throughout the United States.
5.2 Marketing Strategies
Marketing for the Venture Capital Firm will be limited as there are limits as to what can be printed when it comes to private investment partnerships. However, with the assistance of the Company’s law firm, the business will become prominent in industry circulations that focus on venture capital and venture capital investments. The Venture Capital firm will also maintain an interactive website that showcases the operations of the firm, its principals, its portfolio investments, and the site will feature a login system where accredited investors can view their accounts and other information that is limited to accredited investors. As stated above, the Venture Capital Firm will also make it known that it is in the business of investing in new startups with innovative concepts, existing businesses that need growth capital, and technology businesses. This will ensure that the business can make investments quickly into profitable businesses.
In this section, describe the pricing of your services and products. You should provide as much information as possible about your pricing as possible in this section. However, if you have hundreds of items, condense your product list categorically. This section of the business plan should not span more than 1 page.
6.0 Organizational Plan and Personnel Summary
6.1 Corporate Organization
6.2 Organizational Budget
6.3 Management Biographies
In this section of the business plan, you should write a two to four paragraph biography
about your work experience, your education, and your skill set. For each owner or
key employee, you should provide a brief biography in this section.
7.0 Financial Plan
7.1 Underlying Assumptions
The Venture Capital Firm will have an annual revenue growth rate of 16% per year.
The Owner will acquire $10,000,000 of equity funds.
The business will generate annual returns of approximately 35% compounded in unrealized gains.
7.2 Sensitivity Analysis
As the Venture Capital Firm will have many portfolio investments, economic risks will be spread out among a number of businesses. As such, any type of economic recession will not have an impact on the Company’s profitability or cash flow.
7.3 Source of Funds
7.4 General Assumptions
7.5 Profit and Loss Statements
7.6 Cash Flow Analysis
7.7 Balance Sheet
7.8 General Assumptions
7.9 Business Ratios
Expanded Profit and Loss Statements
Expanded Cash Flow Analysis