Marketing

This section must contain information about your marketing process and the channels of distribution viz:

·         How does the product leave your plant and arrive in the hands of the ultimate user?

·         Will you have a direct sales force or use distributors?

·         What brokers or intermediaries are involved in selling your product?

·         What is the relationship of your company to these intermediaries?

·         Any special arrangements you have entered into in order to market your product.

 

Most Venture Capitalists are poor market analyzers. They fancy themselves as marketing men, but they are not. In explaining the marketing of your product, you will have to take one step at a time so they can understand the marketing process.

 

If you are marketing to the government almost exclusively, most Venture Capitalists will be nervous because your company will be subject to the whims of governmental appropriations. You will need a convincing explanation to overcome the objections to the marketing of most of your products to the government. Further, if you have just one buyer, it may be difficult for the Venture Capitalist to accept your marketing dependence on one customer. The risks are too high.