Many of the funding presentations given to venture capitalists, angels and even relatives these days emphasize the harvest, indicating to the investor that a return of three, five, 10 or even 20 times the investment is feasible when the company is harvested in as little as three years.

As you might expect, this is usually one of the highlights of the business plan presentation, especially when you consider that a normal return would be about 8 percent to 10 percent per year. Anything more than that would have to be considered a real home run, and human nature being what it is, greed can become a major motivator for those with dollars to invest.

When someone says he's sure he can execute the business plan and harvest the company by an IPO, a sale or merger to a competitor with 10 times the money returned, it is hard not to listen. Everyone likes the idea of a wealth-producing event not too far in the future.

But let's face facts. Even the most successful companies require an average of seven years before significant returns are paid to the investors. Sophisticated investors understand that. But even they can succumb to the lure of instant gratification. They want to believe that the Holy Grail is out there and all they have to do is invest and wait a short time for the dollars to rain down. If the business has to do with something technical that the investor doesn't really understand, then the harvest strategy becomes more important.

With the memory of the dot-com bubble still clearly in our minds, contemporary investors ought to look carefully at whether or not the company can achieve its goals through basic business principles that lead to a market-dominating organization. And that is what the entrepreneur should concentrate on also.

Creating a seasoned management team, conducting independent market research proving that a market exists, taking a serious look at the strengths of the competition, putting together a good sales team, establishing distribution channels that are feasible and reachable - these are the things upon which the entrepreneur should concentrate.

Unfortunately, too many entrepreneurs spend too much time focusing on the narrow view of how the product or service will revolutionize the industry without realistically figuring out what it will really take to become a player in a particular market. In my experience, the amount of funds needed to successfully launch a new product is usually about three times what the entrepreneur forecasts. And claiming that the new product or service will get even 1 percent of the existing market is pure hype.

The thing that wise and successful investors want to see is if the management team can build a really great company. If they do that, the harvest will naturally follow. Market leaders will want to acquire a competitor's well-run business at a premium.

One such business just acquired for cash and stock was Mingle Match, a company that started four years ago with one LDS dating site and then built 30 other sites, continually updating and improving them. The key to Mingle Match's success was the management team, who concentrated on building a great company. They actually had no interest in selling the company but were recognized by several industry leaders who came to them. They really didn't have a harvest strategy - they just wanted to build the best company they could.

Similarly, Imagine Learning in Utah County is currently less than a year old, but already they have $2 million in revenues. And they did it by forming a great management team and focusing on applying business principles that would build a competitive company.

So if you are starting out and are concentrating on impressing someone with a harvest strategy to garner their investment funds, put that idea on the back burner until you can convince the investor that you have what it takes to build a great company.