A. Reality check

Please score the venture (3) according to these eight initial criteria:

Probably NO

Probably NO but a plan exists to address the issue

Probably YES

1 Is there a written and fully current business plan?

2 Are there current financial statements and cash-flow projections prepared or reviewed by an outside accountant?

3 Does the business concept appear to be based on sound technical and business principles (i.e., does it make sense?)?

4 Is the time needed to reach positive cash-flow appropriate?

5 Based on the company’s achieving the financing it now seeks, will adequate financial resources be available?

6 If the business opportunity is based on proprietary technology, is the proprietary position adequately protected?

7 Is there good personal chemistry among the principals?

8 Do the personal financial needs of the principals match the capacity of the business?

B. Market Opportunity

Using the check-off scale (3), please give this venture a rough ranking for each of the listed factors.

Probably Inadequate

Probably equal to the competition

Probably better than most competition

Potentially outstanding

I cannot tell

1 Evaluate the company’s belief that is has a significant and credible market opportunity (i.e., is the product or service or business system distinctive or an order of magnitude better in performance?).

2 Assess the company’s market approach including strategies for dealing effectively with customer indifference (or lack of knowledge), competitive offerings, and other economic forces.

3 Evaluate the company’s ability, as a new entrant in this market niche, to survive long enough to succeed.

C. Management

Please score the venture (3) according to these five major criteria:

Probably NO

Probably NO but a plan exists to address the issue

Probably YES

1 Is there at least one member of the management team qualified to undertake the work?

2 Is the management team complete and appropriate for the work that is to be done?

3 Is there a willingness to bring in additional management and outside directors?

4 Is there an appropriate group of outside professional advisors?

5 Does management have the ability and experience to leverage scarce resources?

D. Technology issues

Using the check-off scale (3), please give this venture a rough ranking for each of the listed factors.

Probably Inadequate

Probably equal to the competition

Probably better than most competition

Potentially outstanding

I cannot tell

1 Assess the feasibility of the stated technology development goals and technology application objectives.

2 Compare the proposed development program with existing technologies (or with possible competing and future technologies).

3 Assess the company’s technical achievements to date.

4 Assess the company’s plan for obtaining any necessary regulatory or trade association approvals.

E. Resources

Using the check-off scale (3), please give this venture a rough ranking for each of the listed factors.

Probably Inadequate

Probably equal to the competition

Probably better than most competition

Potentially outstanding

I cannot tell

1 Evaluate the adequacy of the company’s budget in comparison to the work that is outlined.

2 Evaluate the possibility of raising additional funds to carry out the project.

3 Evaluate the adequacy of the facility against the needs of the tenant company.

F. Commercialization program

Using the check-off scale (3), please give this venture a rough ranking for each of the listed factors.

Probably Inadequate

Probably equal to the competition

Probably better than most competition

Potentially outstanding

I cannot tell

1 Assess the proposed commercialization timetable, in terms of....

1.1 R&D timetable

1.2 protecting proprietary rights

1.3 marketing timetable

1.4 manufacturing timetable

1.5 possible regulatory factors

2 Comment on the company’s sales function and its ability to compete in the marketplace.

3 Evaluate the company’s methods of distribution.

4 Evaluate the company’s approach to customer support.

5 Evaluate the company’s financial control, management, and strategic planning capabilities.

6 Evaluate the feasibility of the company’s commercialization milestones.

Virginia G. Bonker
230 Lackawanna Dr.
Andover, N J   07821-4113
 Tel 973 426-1767  Fax 973 426-0224
virginia@bluerockcapital.com

 Terry Collison
5700 Kennett Pike
Wilmington, DE  19807-1312
Tel 302 426-0981  Fax 302 426-0982
terry@bluerockcapital.com