An entrepreneur can go in a number of different directions in raising money to launch a business, or in building a fledgling operation into something bigger. One option that can be worth exploring is working with a venture capitalist firm.

These investors offer funding — more than what angel investors usually provide — in exchange for ownership in a startup. They often help steer the business as well. For some potential business owners, this can be a deal-breaker. They may have decided to start their own business to achieve independence and want the freedom to develop it in line with their own vision.

Another drawback: Historically, women and minorities have found it hard to access venture capital. CNN reported on a study indicating that only 3 percent of venture capital funding went to women CEOs from 2011 to 2013. Another study noted by CNN revealed that businesses run by black women received just 0.2 percent of venture capital funding from 2012 to 2014.

Yet Business Insider reported that venture capital funding reached $84.2 billion in 2017, the highest it has been in a decade.

The road to venture capital can be a difficult one. Startup founders should be prepared for this process, and know what investors are looking for. Here are several key elements that they may be seeking.

Business model

This is a vital initial step in starting a business and in seeking investors. The development of a strong business model will require research into the market — a SWOT analysis (strengths, weaknesses, opportunities, threats) is a helpful start — along with revenue potential and projections. Author and marketing expert Neil Patel explores this on his website, writing, “Whatever revenue model you choose for your company, you need to know it inside out before you pitch to investors.”

“It’s one of the most important things they want to know,” he says. “Your business model should address market demand and how you’re going to attract customers. It should also list any potential challenges, or when you might need additional funding. Don’t be afraid to be honest about your company’s challenges. The people in front of you are all successful business people, which means they’ve failed more than a few times in their lives. Being honest builds trust and credibility. Investors know how tough business is and they won’t trust someone who comes in and says, ‘I’ve got it all figured out!’ Because no one has it all figured out.”

Teamwork

There are natural selling points for a startup, including the overall potential of the business and the leadership of the founder. Writing for startupnation.com, Mark Lamoriello explains that venture capitalists are looking for more than a strong point person, and want to know that the leadership has assembled a strong team.

“Investors will look at your management team to assess strengths and make sure members have complementary skill sets; this helps them to envision the team executing the idea to its fullest,” he says. “When looking at a team, venture capitalists hope to see different skills that can contribute to the overall success of the company. It’s not so much about the idea as it is about the ability of those working on the idea — whatever it may be. … Build a team that is efficient and that works well together. When you balance abilities and choose people dedicated to shared success, you are more likely to impress investors.”

Expertise

Investors want to know that their money is in good hands. A startup’s founder will need to clearly demonstrate the skill, knowledge and leadership that will put the business on the right path. George Deeb explores some of the questions that come with the territory in a story for Forbes:

“How many years of experience do you have? In what roles did you operate that were relevant to your new business? Or, for tactical positions, like CMO or CTO, what other marketing or technology roles have you had in the past, and were they relevant for a startup in this industry (e.g., a Fortune 500 CMO will not understand how to market a startup on a shoestring budget). While in these positions, what successes can you share, and what failures did you learn from? And, frankly, they care a lot more about your failures to see how resilient you were and how battle tested you are at getting your business through the bad times (which are inevitable in any startup).”

Passion

A startup founder can have all the enthusiasm in the world, but not know how to properly express it in a venture capital pitch. Nerves may come into play during the presentation as well. Writing for Inc.com, John Rampton notes the importance of having a compelling pitch, and he acknowledges the common fear of public speaking.

“We’ve all experienced that dread at some point, but don’t let the fear and anxiety overtake you during your presentation,” he explains. “If you’re passionate, sincere, and honest, VCs will see that. They’ll notice that you’re an individual who truly believes in what you’re selling. And that makes you compelling. You don’t have to do cartwheels or put on a song and dance. Be prepared. Practice. Smile. Look at your audience. And let the VC know how much this business means to you.”

Honesty

Yes, it’s still the best policy, and that goes for business dealings, too. A pitch for venture capital is no time to stretch the truth. Exaggerating a business’ potential can turn investors away, or create unrealistic expectations, which then will be difficult to manage. A wiser approach is to present a realistic look at what a business can achieve, as Rampton writes in his Inc.com piece.

“Don’t try to be sneaky and trick investors with made-up or inflated numbers,” he says. “Investors will see right through it. Provide and present accurate information in a plan that includes the most important drivers for revenue (amount of customers, selling price) and costs (sales and marketing expenses, costs of goods sold).”

Confidence

This goes hand-in-hand with the aforementioned passion. A venture capitalist will naturally want to see confidence in an investment pitch. It would certainly be a hard sell otherwise. Adam Lieb includes this in a story for Entrepreneur, writing, “The success of a pitch relies on building confidence with your investors.”

“Through my own company’s fundraising experience, I found that a healthy mix of self-confidence and humility goes a long way,” he says. “However, you also don’t want to appear arrogant about your command of the market. Just as you need the investors for capital, they need to know you have things under control and have mastery of your field.”

Presentation

Though preparation is a key factor in a funding pitch, the presentation itself doesn’t need to be an overly complicated one. And many believe that it should not require a lengthy meeting. Brian Hopcraft, managing director of Lewis & Clark Ventures, a venture capital firm in St. Louis, writes about this in a story for Inc.com. He recommends the format created by author and marketer Guy Kawasaki, known as the 10/20/30 rule.

“A pitch should have ten slides lasting no longer than twenty minutes in a thirty-point font,” Hopcraft says. “We have seen presentations with 45 slides on product alone … for an hour-long meeting. This leaves us with virtually no time to get to know the company, review financials, ask questions, etc. Everyone’s time is valuable, and we meet with hundreds of companies. Be concise in showing your product differentiation and be sure to cover the basics.”