The length of time from initial contact to completing the deal depends on several factors including:
Generally, for professional angel groups and VC firms - this part of the process takes 3-6 months after initial contact.
You should also consider the time it takes for you to be "capital ready" when you approach investors.
Sorry - I didn`t mean to be so esoteric. We use that term with our client`s and it sort of slipped into my post.
To us, being capital ready means that both the people and the business are ready to move forward once the provider of capital is “on the scene”. The objective is to avoid backtracking or halting the progress of the engagement.
What specifically is needed to be “capital ready” will depend upon several factors including:
Almost everybody has heard that a basic business plan is part of being “capital ready”. While the following is by no means a complete list – here are a few more to consider:
1. What is your capital strategy or plan?
2. The business should be properly structured and “engineered” to accept the capital being sought. (i.e. if you want a company line of credit – you need to have a formal entity. If you intend to sell equity, the company needs to be “designed” to accommodate this)
3. Do you (and your team) know what to expect as the process and are you prepared to “handle” it?
4. Do you know what questions (FAQ’s) that will be asked and are you prepared to respond?
5. Are the necessary / appropriate documents in place (available) for the “due diligence” phase.
6. What capital “magnets” have (or could) you include – which would reduce the real or perceived risk?
7. Are you comfortable with what you (the company) is prepared to do in order to acquire this capital – and more importantly what you are not willing to do?
I hope this helps.