You’ve begun developing a concept for a series of new applications for mobile devices.  Or a new way of engineering a manufacturing process.  Or a biotech innovation.  You’ve even formed a company (let’s call it “Newco”) to develop your concept into a working technology.  Now what?

You’ll need money to support yourself, recruit a team, rent space, obtain equipment, and build your technology.  At first, you may self-fund, using savings, personal borrowing, income from your “day job”.  Then you’ll turn to “friends and family”.  But, at some point, you’ll need financing beyond these immediate resources.  That’s when you’ll have to depend on the self-interest of strangers.  Not their kindness, their self-interest: these are angel investors looking for return on their own money, or venture capitalists or other professionals who must produce returns for their fund investors.  And their experience instructs them that, however great your concept may be, turning it into a commercial success that gives them a strong return on the money you’re asking them to risk is a long-shot.

So your first meeting with any potential investment decider is critical:  You must be prepared to answer their hard questions to move beyond that meeting.  Here’s some of the questions you can expect:

1. Newco’s Technology:
   • What will Newco’s technology do?
   • What users is it designed for?
   • What have you completed to date in its development?
   • What is the projected timeline for developing your concept into a working model?
   • How is Newco’s exclusive ownership of the technology clearly documented?
   • What steps have you taken to protect Newco’s rights in the technology and all confidential information related to it?
2. Newco’s Business Model:
   • How will Newco commercially exploit this technology?
   • What different revenue streams will this produce?
   • What similar technology is now in the marketplace, or in some stage of  development?
   • What will give Newco a demonstrable competitive edge?
   • What’s to prevent an established or better-financed company from seeing your product and creating a non-infringing competitive technology?
3. Newco’s Ownership and Management:
   • What roles do each of the current principals play in Newco’s business?  What’s their expertise and experience in these types of roles?
   • Who else will be involved in the technology development, strategic planning and business operations of Newco, and what roles will each person play?
   • What is the percentage ownership of each of the principals and key recruits?
   • Are there any outstanding options, warrants, convertible notes, or other rights to acquire Newco equity
4.          Newco’s Funding and Timeline:
   • How much money have the founders contributed to Newco?  Friends and family?
   • How much money has Newco raised from any other investors, and who are they?
   • What equity and related rights were they given (including conversion rights on debt)?
   • How has this money been used to date?
   • How much money is Newco now looking to raise?
   • What will that be used for, and what milestone will that take Newco to? (E.g., Working beta version?  Something short of that?  Beyond that?)
   • When will more money be needed, and how much is estimated?  What milestone will that take Newco to?
   • When do you project that Newco’s technology will reach a completed, go-to-market stage?