Double your money, specialist Mike Powell has advised Midland entrepreneurs who are seeking start-up finance.
Mr Powell, who has raised #80 million of early-stage risk finance over the last 15 years, said hopefuls needed to start out with "an honest and well-thought out business plan".
He added: "But when it comes to finance, double the money suggested by your plan. It won't be enough - but it will be enough to get you started."
Mr Powell, who has just secured a further #5 million of institutional funding for Pelikon, of which he is chief executive, made his comments at a business finance seminar at Aston Science Park, Birmingham, when more than 120 delegates were given specialist advice on funding and issues surrounding possible Stock Market flotations.
He said it was not unusual for new enterprises to realise early finance by principals mortgaging their homes, sell-ing the "family jewels" or being backed by friends, family and even existing employees.
However, he cautioned: "Only invest what you can tolerate losing."
Mr Powell, whose Cambridge and Cardiff-based company is considering a flotation on AIM within the next year, said there were other avenues such as grants, banks, customers and suppliers, who were sometimes prepared to invest in funding development programmes. In addition, there was the venture capital market.
But he warned: "Sometimes VCs have a failure of vision - and attacks of contagious pessimism. And they can't bring themselves to believe high value businesses are possible."
However, he told delegates : "Venture capitalists know more about your market and running business than you do!"
Mr Powell, who in his career has raised finance to launch three technology design and manufacturing start-ups, said: "If you are talking to VCs, then your proposition must be high risk, high reward, otherwise you would find another way of financing it. So they need a high rate of return - 40 per cent per annum compound. They have also seen more ways to make an investment fail than you can ever think of."
There was no such thing as a standard VC deal, so it was up to companies to negotiate - and not to be so concerned about holding a big per cent of the initial funding round.
"Work towards holding the biggest percentage possible, on largely the same term as the VCs, when the business is finally sold or becomes liquid."
Mr Powell also stressed that management should know their strengths - and accept their limitations. "It is very unlikely that you have the talent to manage the business all the way through to the size and complexity of operation a VC needs in order to make a sensible return. Surround yourself with the best people you can and don't be afraid of appointing people more experienced in business than yourself.
"In successful start-ups you usually only get at your wealth when you are no longer working for the company."
Pelikon claims to be a world leader in the development and commercial application of wafer-thin, flexible, plastic display technology used in the production of home appliances, consumer electronics and industrial applications.
It was the first of Aston Science Park's latest series of seminars, targeted at identifying critical elements necessary to help drive business growth. Other presentations were made by Andy Moss, senior business development manager, Lloyds TSB, Richard Blood, of accountancy firm Moore Stephens, and Adam Hart, of stockbrokers KBC Peel Hunt, which introduced new institutional investors to Pelikon in its latest funding round.
The seminar was chaired by Jeremy Parkin, of law firm the Wilkes Partnership.
Dr Derek Harris, chief executive of Aston Science Park, said: "The seminar programme is an excellent platform for learning some practical tips on pertinent business issues ranging from finance, HR and marketing to tax and pensions."