Entrepreneurs who need capital (all of them at one time or another), need to step back every once in a while and try to take an objective look at their own deal through the eyes of a potential investor.
So try this for an exercise:
Let's say you're an "accredited investor". You like being involved in small and lower middle market deals...start-ups, re-starts, turnarounds, special situations.
Imagine that you have a liquid net worth, or you participate in a partnership, that not only gives you the opportunity to invest in a full range of investments, but also requires it. You have capital that has to be put to work.
You're comfortable with the risks of starting, building, running and selling private companies.
If you're not in a controlling interest position, that's fine, but there will be the necessary protections and incentives.
This is more than a hobby or a passing interest, but you've got your own set of demands, maybe an existing portfolio of investments and personal involvements.
Maybe you've had some success yourself in building private companies, so you have a taste for it. You enjoy it. This also means that you've been through some ups and downs before. You're not going to panic when things don't immediately go as planned.
You're able to change direction when it is clear that the market is moving away from you.
You've come to appreciate the benefits of having skillful, motivated people involved with you.
You're not naive.
You're not stupid.
You're looking at deals all the time, some are more interesting than others.
You've seen a million unreasonably optimistic business plans, or plans with no substantial basis in reality.
You have your own opinions.
You have your own interests, strengths, fears, and history.
Now...let's look at your deal.
