Growth Company ABC’s: “Always Be Credible”
Seeing as BPC is new to blogging, we’ve got a considerable backlog of things we’ve been chomping at the bit to share. We found a post by Jeff Bussgang of Flybridge Capital over at VentureBeat last month that we’ve been meaning to blog about.
Bussgang’s post outlines some savvy advice for entrepreneurs entering into the “investor pitch” phase of their business growth. As an advisory and management consulting firm that most often comes into contact with businesses at critical junctures in their growth, we’ve helped many firms get ready for due diligence. As Flybridge’s Bussgang writes:
“Assume that everything you say will be thoroughly checked out in due diligence. If you claim credit for a company where you played a small role, it’s bad form. I recently called the CEO of a company that an entrepreneur bragged they had led during the pitch. When the CEO told me they were a minor player and left after a brief two years, I stopped spending any more time evaluating the opportunity.
Remember, investors are professional BS detectors. Err on the side of underselling your background because the BS alarm bells may ring in the first few minutes of introduction and spoil the rest of the presentation.”
That rings true for our team here at Bridgepoint. When we’ve gone through an “investment prep drill” with businesses looking to prepare for due diligence and take on additional funding, we’re told it helps to accelerate funding. That has everything to do with identifying the true strengths and, yes, the true liabilities of a company in transition and understanding how to get out ahead of those strengths and weaknesses ahead of the due diligence process.
In a business environment as saturated and credible as Central Texas, investors have seen everything. Real prep for due diligence prepares a business to confound those expectations and move into a new phase of growth built on real strength and, most importantly, sound information.