What I Wish I Knew BEFORE Fundraising
When you’ve got a great idea, you need big investments. For tech startups, this means pitching to multiple parties to raise funds, and working hard to seek out partners whose values and passions match their own. Here are a few things I wish I’d known before I started fundraising, that I now implement with all the tech startups I work with.
Networking is Essential
Yes, you really need to talk to people. A lot of people. While your app or platform might already be generating interest, you want to ensure that you get investment from stakeholders who genuinely want to see you succeed. That usually means using your existing connections to meet potential investors with a passion for what you’re trying to achieve—or who are directly or even indirectly impacted by the pain point you’re addressing. Attend industry events, jump on virtual conferences, and comment on the latest blogs from thought leaders in your field. There is no downside to making connections and building partnerships.
Fundraising is Challenging
By no means do I want to put ambitious entrepreneurs off starting a new business, but it’s important to understand that fundraising and attracting investors is difficult. Truths that factor into that include:
There are over one million startups worldwide
Most of these are in the United States
90% of startups fail
It can take three years for startups to turn a profit
Source: DemandSage
Only 0.05% of startups ever raise venture capital, which could be a discouraging figure. However, the way to approach this is with absolute confidence in your product and total transparency. Assess your risk factors and make mitigations part of your pitch deck. Show investors that you’re ready to work in a crowded and competitive market. Above all, know who you’re going to sell to, and be ready to explain why those people, your target audience, need your solution.
No means No
Sometimes an investor will say “No,” and that can be hard for an ambitious startup to hear. What makes it even harder is how nice and polite many VCs will be, perhaps extending the hope that it’s “No for now” rather than “No way, no how.”
Sticking around to see if investors change their minds is a startup-killing move. Be ready to move on to the next interested party, and don’t take “No” personally. Not every investment company will see your startup as a good fit for them, and that’s totally normal.
Final Word
In the words of Seth Godin, “Marketing to others begins with marketing to ourselves.” When you truly believe in your product, your company, and your brand, that passion will inevitably show in your marketing efforts—with the right team. Book a 15-minute introductory call with the team here at Arch Collective, and let’s get you the startup marketing and branding support you deserve.
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