The way that Venture Capital (VC) firms invest means that only a certain type of business is suitable for them to invest in. The theory goes like this, most VC investments fail, but the ones that do succeed cover the costs of the failures and give a healthy return. To use the boxing analogy VCs throw haymakers. Most businesses do not have the potential to generate the level of return needed for the VC investment methodology. As a first time entrepreneur, you need to start slow and build from the bottom up. Initially seeking VC funding is a bad idea in most cases. The chances of a reputable VC firm investing in a team of first time entrepreneurs are very slim.

A better idea is to develop your business and seek a Business Angel if you need additional funding. The right Business Angel will really improve your business. The Business Angel will be invaluable in increasing your revenues, and hence, improving your chances that you will make a profitable exit. If your business does require further VC funding to scale, then having a successful Business Angel on your team is crucial.

It's important to remember that the process of getting VC funding is expensive (for bootstrap entrepreneurs like us). You will have to pay for due diligence along with other legal and accounting fees. To put this in context, if you are smart, you will have to get personal legal advice which is separate to the legal advice for your business and you will have to pay for both. On top of this, you are at a major disadvantage when undertaking negotiations with VCs. They do this all the time, and you are only going through this process for the first time. Having an experienced Business Angel leading your side in the negotiations will greatly improve your position.

Traction is the currency of private equity investment, both on Business Angel and VC levels. Accumulating traction is always a good idea. As a result, you need not be concerned with VC or Business Angel funding as long as you are pursuing traction with all your might. Look at it like this, investors look at your business as a money machine. It's up to you to be the engineer that builds that money machine. The more traction you have the better your negotiating position.

Getting funding should not be the main focus of your business. Making a profit should be. If you do this, then any funding to help you scale will come naturally.

However, it's difficult to bootstrap a business to the investment ready stage. These top 10 tips for business start-ups may help you along the way.

It's a lot of hard work but if you persist you will see the benefits and reap the rewards.