Raising venture capital

I have an idea for a business venture that I am certain cannot fail. However, to start this venture large amounts of capital are required.

My fears are that if I present my proposal to a business angel or a venture capitalist, they may reject my idea but decide to establish it themselves. How can I be certain that other parties will not 'steal' my idea?

Shehbaz Afzal, Manchester

Whilst I can understand the concern at showing the ideas to outsiders and the risk that they might "steal" it, on the whole this has not been a significant problem over the past few years.

You might consider the use of a non-disclosure agreement if you are particularly worried about this, which a lawyer could advise on. However some venture capitalists will not sign these.

I would strongly recommend that you only deal with established VC's, as they need to maintain a reputation as good supportive partners to fast growth businesses, so as to maintain their deal flow.

These firms also see a lot of plans, so you would need it to be developed well beyond an initial idea, making sure that you put a well considered business plan to them.

The single best way to protect the business is to develop real barriers to entry as fast as possible - these could be anything from ownership of patents and other forms of intellectual property through to having contracts with customers or having built a great team to execute the business plan.

This is of course what you should be aiming to do with the money that you have raised.

The real winners are those that implement effectively and quickly - and they are not necessarily those who come up with the best ideas in the first place.

Stuart Watson, partner, entrepreneurial services, Ernst & Young

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