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Flip The Switch

Entrepreneur, Oct, 2001

A FEW THINGS TO KNOW BEFORE YOU HIT THE TRAIL IN SEARCH OF FUNDS FOR YOUR ENERGY COMPANY

Raising money for an energy start-up is harder than screwing in a light-bulb, but investors and experienced energy entrepreneurs say it can be done if you follow some simple rules:

(1) Have a working prototype of your new technology ready to show investors. Exception: Companies selling energy management services and software may need only a good idea and a strong management team.

(2) Have customers before looking for investors. Seek government R&D contracts. Utility companies may also hire early-stage energy start-ups to do R&D.

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(3) Look for institutional venture capitalists with track records of investing in energy companies. Few angel investors have the expertise to invest in cutting-edge energy firms.

(4) Get a good management team. Investors want to see seasoned, entrepreneurial executives running the company.

(5) Write your business plan to stress the market opportunity, not the technology.

Business Services Industry

Flip The Switch

Entrepreneur, Oct, 2001

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