Raising Venture Capital
Paul Graham, Founder, Y Combinator, once said, “ Investors are pinched between two kinds of fear: Fear of investing in startups that fizzle and fear of missing out on startups that take off.”
If you are wondering how to raise capital from a VC, this is the first thing that should inspire you! We normally hear entrepreneurs fearing the investors as they are too choosy while bringing out the dollars but, the fact is, investors are even more excited to bring out the capital provided you offer them a great investment opportunity. So if you think yours is a startup that investors usually look out for, you know you are ready to roll.
Below are some very unique tips on raising venture capital that you should remember especially, if you are a beginner.
Tips On Raising Venture Capital In Singapore
Be Confident
In another quote, Paul Graham mentioned a secret, “ Convince yourself that your startup is worth investing in, and then when you explain this to investors, they will believe you.” In other words, you have to be confident about the success of your idea. If you are in doubt, it will reflect on your face and guess what? The game is over!
Target The Investor, Not The VC Firm
You must keep your focus on the person who will be investing and not the firm and try to make an opportunity for one-to-one interaction with the person. There are, often, more than one investors within a firm each with their own point of view regarding startups. So it is better to look for that one investor who you think will be generous enough to pay attention to your idea.
For faster access, you can also talk to other entrepreneurs who have recently raised capital as they can be an excellent source of information regarding investors who are currently active and interested in your specific industry.
Be An Attention Seeker
Once you manage to find a few suitable investors, try to chase them wherever you can (wisely, of course). You can start with following them on social media and other online platforms wherever they are present. Keep a watch on their blogs, social media posts and comments; to grab their attention, you can, at times, click the “Like” button, share their posts or leave a comment on their blogs. Make sure your comments are regular so that they start catching the investor’s attention. This is a very important phase and your activities form an impression in the minds of the investors and gradually become a known face for them.
Introduction Works Best
If you have someone to introduce you to the investors, there is nothing like it! The venture capitalists are so busy that they do have enough time to look at boring/lengthy emails or attend any cold call. Moreover, since they are involved in high-risk investments, they usually rely only on deals that come through strong recommendations. So try to find someone who has worked or works closely with the investor. It can be an entrepreneur who has already raised capital from your target investor or any other reliable person.
Leave No Scope For Imperfection
Imperfection kills everything. If you have set off for a fundraising campaign, you must be ready with all the prerequisites as you may have to stand in front of a potential investor at any point of time. You never know when an opportunity knocks so make you all these things with you: a unique idea, a solid business plan, an innovative business model, a strong value proposition, a smart management team, your business valuation papers, a sizable and scalable market, a strong pitch and all other important documents.
Conclusion
Capital raising is no rocket science but an art; those who do it well are the winners. The points mentioned above are not directly related to your business but they all point towards maintaining the right attitude and making the right approach. If you proceed with these points in mind, you will soon find yourself sitting on your dream table signing the final deal with the investors.
For more information on how to raise capital, feel free to get in touch with us at Merger Alpha http://mergeralpha.com/.
You can also share your thoughts and experiences with us in the comment box given below.
Good Luck!
Paul Graham, Founder, Y Combinator, once said, “ Investors are pinched between two kinds of fear: Fear of investing in startups that fizzle and fear of missing out on startups that take off.”
If you are wondering how to raise capital from a VC, this is the first thing that should inspire you! We normally hear entrepreneurs fearing the investors as they are too choosy while bringing out the dollars but, the fact is, investors are even more excited to bring out the capital provided you offer them a great investment opportunity. So if you think yours is a startup that investors usually look out for, you know you are ready to roll.
Below are some very unique tips on raising venture capital that you should remember especially, if you are a beginner.
Tips On Raising Venture Capital In Singapore
Be Confident
In another quote, Paul Graham mentioned a secret, “ Convince yourself that your startup is worth investing in, and then when you explain this to investors, they will believe you.” In other words, you have to be confident about the success of your idea. If you are in doubt, it will reflect on your face and guess what? The game is over!
Target The Investor, Not The VC Firm
You must keep your focus on the person who will be investing and not the firm and try to make an opportunity for one-to-one interaction with the person. There are, often, more than one investors within a firm each with their own point of view regarding startups. So it is better to look for that one investor who you think will be generous enough to pay attention to your idea.
For faster access, you can also talk to other entrepreneurs who have recently raised capital as they can be an excellent source of information regarding investors who are currently active and interested in your specific industry.
Be An Attention Seeker
Once you manage to find a few suitable investors, try to chase them wherever you can (wisely, of course). You can start with following them on social media and other online platforms wherever they are present. Keep a watch on their blogs, social media posts and comments; to grab their attention, you can, at times, click the “Like” button, share their posts or leave a comment on their blogs. Make sure your comments are regular so that they start catching the investor’s attention. This is a very important phase and your activities form an impression in the minds of the investors and gradually become a known face for them.
Introduction Works Best
If you have someone to introduce you to the investors, there is nothing like it! The venture capitalists are so busy that they do have enough time to look at boring/lengthy emails or attend any cold call. Moreover, since they are involved in high-risk investments, they usually rely only on deals that come through strong recommendations. So try to find someone who has worked or works closely with the investor. It can be an entrepreneur who has already raised capital from your target investor or any other reliable person.
Leave No Scope For Imperfection
Imperfection kills everything. If you have set off for a fundraising campaign, you must be ready with all the prerequisites as you may have to stand in front of a potential investor at any point of time. You never know when an opportunity knocks so make you all these things with you: a unique idea, a solid business plan, an innovative business model, a strong value proposition, a smart management team, your business valuation papers, a sizable and scalable market, a strong pitch and all other important documents.
Conclusion
Capital raising is no rocket science but an art; those who do it well are the winners. The points mentioned above are not directly related to your business but they all point towards maintaining the right attitude and making the right approach. If you proceed with these points in mind, you will soon find yourself sitting on your dream table signing the final deal with the investors.
For more information on how to raise capital, feel free to get in touch with us at Merger Alpha http://mergeralpha.com/.
You can also share your thoughts and experiences with us in the comment box given below.
Good Luck!