10 Tips to Help You Grab the Money

For the past seven months, I have been trying to raise capital for a new venture. Luckily for me, I have worked for and with venture capitalists and private investors. I also wrote a book on venture capital. All of this translates into access -- but not a term sheet.

For those of you who don't know what a term sheet is, it is a preliminary agreement of what investors are willing to invest for a piece of your company.

What does it take to get a term sheet? Urban legend has it that to get a term sheet you either have to sell an appendage or become a "made man" in one of the five organized crime families in New York. The truth is that you need 10 things.

1. Your concept has to have obscene revenue potential and solve the mother of all problems. The business plan has to be well thought out and succinct. The number of pages should be between 25 and 35, including financials.

2. You need a credible management team. The team members' resumes have to show experience, including at blue-chip household-name companies. On my team, I have a former division president of American Express.

3. You have to know the right people. Yes, your dad was right when he told you it isn't what you know but who you know. In my case, I needed a strategic investor with a strong understanding of how to build financial service businesses who could raise truckloads of debt financing.

4. You need an internal champion at the venture fund to tout you and your concept as one of the best ideas he or she has ever seen. In my case, I had a young man who was rabid over our concept. He drove the whole process and got other people excited.

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