Last week Rimon Advisory was part of a dynamic panel that was put together with the aim of giving Startups a few “Insider” tips on how to raise capital effectively. The event was hosted at WeCo (a collaborative co-working space for Startups). Several different perspectives on the do’s and don’ts of capital raising were shared from Investors, Crowdfunding, Consultants and successful Startups.
A few great tips came out that we thought we would share:
- Research the investors you are pitching to – who are they and what do they want to see in you? Understand what they are looking to fund. Tailor your pitch accordingly
- Spelling or Grammar mistakes – be careful when responding to e-mails or presenting your idea that you present in a professional manner. Spelling errors is a huge turn-off
- Reply in a timely manner – don’t be lazy and get back to your investors ASAP
- Ask for feedback – rejection can be a positive thing if it helps you refine your pitch and your model
- Don’t demand a 6 figure salary – you have to be willing to give up something for your idea, that something has to be financial (at least initially).
- Marketing budget – often overlooked when pitching to investors and shows a lack of understanding of how to allocate your funding
- Grant funding is a great way to help cash flow – without giving away equity. You can also leverage grants to raise private capital
- Financials – even though you won’t get it 100% correct, make an attempt that shows you are well thought out
- Invest effort in your pitch deck – you only get one shot
- Ideas are worth nothing – you need to have done something to bring your idea into reality
- Raising Capital is only the beginning – then the hard work really begins!
- Don’t over raise – too much capital can lead to diversion from the core focus and ultimate failure
- Own the capital raising process – it’s fine to get assistance from external parties but don’t hand it over. Your timeline will be severely disrupted
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Happy Hunting.