Venture capital

[dullard]

Suppose a small company had a great idea, a functioning prototype of that idea, has published scientific papers about the idea, and has several patents and direct disclosures on the idea. But that company has no sales department, no marketing, no real business leadership and doesn't have the money to pay for any of it either. Thus the idea is rotting on the shelves going to waste.

What would be the steps necessary to get venture capital?

Of course this is related to me, and no, I'm not giving details on what it is. Lets just say biotechnology. This fund's goals describes us perfectly.

 

[IceBergSLiM]

well home much do you need? If its not that much start pitching it to wealth businessmen you already have a relationship with.

 

[dullard]

Originally posted by: IcebergSlim
well home much do you need? If its not that much start pitching it to wealth businessmen you already have a relationship with.

To get the product ready to be sold as it is now? $500k. If we capture 1% of the market, we'd make $5M a year in profit. Thuys, clearly, my boss won't sell a big stake of that for a measly $500k. He'd rather we all get 100% of $0 than $500k and a small portion of a much bigger deal (remember, I said we have no buisness leadership, just a hardheaded boss).

To get it through him, I'm thinking of $15M to buy the patent rights from him and to get the whole thing done properly - build a real lab, a manufacturing facility (or to have it hired out), salary for sales, marketing, CEO, accountants, engineers, repairs, etc. With that we can break into a whole new market where there is no competitor's product currently available. $10M more for FDA approval.

 

[iwearnosox]

There are different rounds that satisfy different needs. Typically you don't need VC cash to begin with so much as angel investors, who are more strategically aligned with how you want to build a company.

I've raised over 53 million in my life. There is no precise formula but if you need some pointers feel free to pm me.

 

[iwearnosox]

Originally posted by: dullard

Originally posted by: IcebergSlim
well home much do you need? If its not that much start pitching it to wealth businessmen you already have a relationship with.

To get the product ready to be sold as it is now? $500k. If we capture 1% of the market, we'd make $5M a year in profit. Thuys, clearly, my boss won't sell a big stake of that for a measly $500k. He'd rather we all get 100% of $0 than $500k and a small portion of a much bigger deal (remember, I said we have no buisness leadership, just a hardheaded boss).

To get it through him, I'm thinking of $15M to buy the patent rights from him and to get the whole thing done properly - build a real lab, a manufacturing facility (or to have it hired out), salary for sales, marketing, CEO, accountants, engineers, repairs, etc. With that we can break into a whole new market where there is no competitor's product currently available.

It would seem wiser to simply pay a royalty for the use of the patent, mitigating those potential startup losses and risk. "Not telling what it is" isn't an option, you'll need to construct an in depth business plan and be selective on who views it. If you have no previous business experience you may want to bring outside talent in.