Finance is the lifeblood of any enterprise, be it business or otherwise. It not only oils the wheels of progress and growth but also puts a smile on everybody’s face.
However, raising capital, particularly for a start–up can not only be challenging but in some cases, harrowing.
And the reasons behind this may not be too far–fetched.
Statistics continue to show that only one in 10 start–ups ever celebrate a decade of continuous business. Of the ten in one hundred, only one may ever truly become profitable within a twenty-year span.
And only one in one hundred may ever truly celebrate unicorn status on or before thirty years of start–up.
Little wonder then seed investors, particularly, become but a little tight-fisted when you approach them with an idea no matter how foolproof you might make it seem.
This can thus make the process of getting your idea up and running, take as much as several years rather than a few short weeks to launch.
Here are some strategies you can consider to expedite a successful fundraiser in the shortest time possible:
- Clearly Define Your Funding Requirements: Determine the amount of seed capital you need and create a distinctly clear business plan and pitch deck on how you will utilize the funds. This will help you articulate your funding needs to potential investors more quickly and effectively.
- Tap into Your Network: Start by reaching out to your existing network of contacts, including friends, family, colleagues, and mentors. They may be willing to invest or can introduce you to potential investors who might be interested in your venture.
- Work with An Expert: Working with an expert in the fundraising field gives you great leverage in selling the more important parts of your company and guiding you through the business sales process. Because they too can have networks of their own, sometimes, more extensive than yours, fundraising experts can tap into a pool of experience, other industry-specific expertise and funding you might not have previously thought possible or even knew existed.
- Angel Investors and Venture Capitalists: Seek out angel investors and venture capitalists that specialize in early-stage investments and invest in industry-specific ideas or companies. Research and identify those who have a track record of making quick investment decisions. Reach out to them directly or through referrals from your network.
- Pitch Competitions and Accelerators: Look for pitch competitions and startup accelerators that offer seed funding opportunities. These platforms often have fast-track processes that provide exposure to investors, better known as cash cows’, who are actively seeking investment opportunities to put their monies in.
- Online Crowdfunding Platform: Consider leveraging crowdfunding platforms to raise seed capital quickly. Prepare a compelling campaign and pitching material that highlights the value proposition of your business and also consider engaging with potential backers through social media and email marketing campaigns or even cold calls.
- Strategic Partnerships and Corporate Investors: Explore the possibility of forming strategic partnerships or securing investments from more established companies in your industry. They may be interested in supporting promising startups and can provide not only capital but also valuable industry connections and expertise where needed. Or even better still, buy you out at a fair price.
- Pitch Concisely and Effectively: Develop a concise and compelling Pitch Deck that clearly communicates your business model, market opportunity, competitive advantage, and potential return on investment. Have a more generic Deck, but tailor certain pitches to certain investors as need be, focusing on the aspects of your idea or business that align with their interests and investment criteria.
- Pitch Consistently and To a Large Pool: Just as the sales saying goes, ‘the greater the number, the higher the potential success rate’, the same philosophy applies to a quick turnaround rate in successfully pitching your idea or company within the shortest possible window. Thus as much as it is important to be concise and effective in your pitch process, it is also important to be able to replicate this quickly, and as many times as possible. Speaking to 50 potential investors will certainly have a greater rate of success of only 5, regardless of if these 5 are cash cows or not.
- Be Prepared and Responsive: Be prepared to answer as many questions, and provide additional information, and quickly, where required. Be ready to also negotiate prompt terms. Some investors may have a sense of urgency in making a decision, so being responsive and proactive in addressing their inquiries can greatly help expedite the investment process. Better still, having an Adviser present during your meetings not only gives you strength in numbers at the negotiating table, it may also help you avoid certain pitfalls that may come along in your bid to make a hasty decision.
- Leverage Online Platforms and Investor Networks: Utilize online platforms that connect startups with investors, Facebook, LinkedIn or even your own website or social media handles. These platforms allow you to showcase your startup, connect with potential investors, and streamline the fundraising process.
While these strategies can help expedite the process of raising seed capital, it’s important to note that getting to the point takes significant time and sweat equity.
Fundraising timelines can also vary significantly depending on various factors, including the nature of your business, market conditions, and the availability of potential investors.
It’s, therefore, crucial to stay persistent, remain focused, and be prepared for potential rejections, several in fact, along the way.
This article was written by Brain Essien, is a certified financial analyst and business process consultant, with expertise in business plan formulation and pitch deck design, brand management, digital marketing, crowd/private equity and seed fund brokerage.
mcbrainandcompany@gmail.com. +234703-444-6041
HivBrian.
We would like to get a partnerahip in writing project proposal for startup and catalyst funds for our NGO in Tanzania. East Africa. Dar es salaam