In this series, we plan to bring real stories from professionals who have been there and done that!
Spokesperson: Puneet Gupta, Founder & CEO Clensta International.
Raising funds is one of the most challenging and all-encompassing tasks that a founder can do to take their startup to its next milestone and ensure it lives to its full potential. It is a scary step – one that is full of rejections and can leave founders emotionally drained. Failure to raise capital could very well spell the end of a startup. After all, lack of funds is often cited as one of the reasons why start-ups fail.
In a healthy economy, it was already difficult for startups to get noticed by investors, much less get a call or face-to-face time with them. Throw COVID in the mix – with the uncertainty and selectivity it brings, the drastic reduction in physical startup fundraising meetings and events, the subsequent pivot to “online” meetings, and those trying to raise in this climate need to ‘up the ante’ to get noticed by investors.
Before approaching an investor, the real step is knowing why you need funding and how much would be the approach?
The initial is the basics: Reaching out to a potential investor
Approaching an investor requires some homework. Every investor needs facts, basics, and numbers. Before you reach out to an investor, understand your needs. Answering basic questions like:
- Do you really need funding?
- How much is enough?
- How are you managing your finances?
- Knowing your team size and revenues?
Preparing for the Right Investment
- Decide Whether You Need an Active or Passive Investor
- Do Your Homework
- Build a Strong Team
- Have an Excellent Product
- Know Your Numbers
- Have a Solid Business Plan
- Decide Whether Your Personalities Match
- Hit with the perfect pitch
The final stage is the interaction with the Investors
Time to make contact
- Use your network
- Interact through social media
- Attend virtual events
- Build an online presence
- Check how was their website open for connections
- Pitch like you foster newborns and give away the products
Points to carry
- Your business model and plan.
- Your traction product. What will gain you a footing in the market
- Your revenue model. What will make you money?
- The future of your business. How sustainable is your business?
- Your competitors. Make them understand that you know the market.
- What makes you unique? Why are you?
- Your team. Describe who does what
“As a founder and with ideas to approach the investors I consider the vital pillars of any organization, Teamwork, integrity, and entrepreneur mindset. However, the factor that gives the boost to scale is the problem a startup is solving for, its scalability and the agility of the team in handling difficult situations.” – Puneet Gupta, Founder & CEO Clensta International.
Must have tools for startups - Recommended by StartupTalky
Subscribe to StartupTalky
Get the latest insights delivered to you right in your inbox