Stages of Development
Not all companies will go through all these stages in their life cycle. Heartland Angels, Inc. invests in the companies that are at the first four stages of development
- Seed - No commercial operations, involved in R & D primarily, a business model is developed and there are both company and long-term product/service strategies. Funding needs for R & D, designing specialized equipment, and product/service development and testing, patent filings, market surveys and research and business partner recruitment.
- Research and Development - These are frequently businesses that do research on and initial development of products and spin them off to other individuals to commercialize. Funding for these is often from grants, gifts or foundations.
- Start-up - Company completes product development and initial marketing. Sometimes these companies are combined with First stage companies. Have interested first adopters or customers in place. The sale is typically a technical sale and is made by the Chief Technology officer if the product is an invention.
- First Stage - Company is expanding and producing and delivering products and/or services. While the company is making revenue, it may not be cash flow positive or at break-even. Increasing sales over time improve the bottom line. The management team is beginning to include more than the initial founders. The corporate board may have non-management members. Frequently these companies are less than three years old, but macroeconomic events have lengthened this period.
- Expansion Stage
- Mezzanine
- Bridge
- Acquisition and Mergers
- Leveraged Buyout
- Buy-out and Spin-out
- Post Venture
- Turnaround
- Distressed Security investing
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