So you have an idea for a company? Have been playing around with it for months? You've done the deep soul searching and now it's time to take the plunge and go all in, turning your idea into a business. Going about the obvious things of picking a name, mapping out the business plans have been keeping you busy off late. But then, even at the slightest thought of the capital, your mind goes blank!
The process is full of mystery and the worst part is that you probably have no idea where to even begin. Raising a seed around can get pretty simple, provided you are following the right steps from day one. Some points to demystify this entire process are :
1. Track Everyone and Everything: Track
You will be meeting hundreds of people about your company in the early days before you decide to raise money, and it is likely that your first investors will be people from that time period. Tracking every point of contact with potential future investors will give you a database of people to reach out to when it is the time to focus on your seed round.
2. Analyze the Market. Thoroughly:
Interpreting the existing market scenario is primarily important. Take a call and wait for the market to develop patiently according to your perspective.
3. Stay Connected :
It is unlikely that someone is going to invest right after the first meeting, by just seeing a snapshot of what you have done. Remember, Investors, like to invest in lines, not dots.
You performing over time in a series of dots (follow-up emails, meetings, calls) can help them get connected with you to paint a clearer picture of your team and company. If you are following point 1 correctly, potential investors will feel like they already know you when it's time to ask for the check.
4. Too many cooks spoil the broth:
Never have more than 2-3 founders. In case you need more experts, you can always hire them. Having one founder is not always the best option. Different outlooks and divided risks is always a favorable position to be in.
5. Keep an eye on your accounts:
Expenses, bills of the previous and upcoming months need to be maintained. This will help you to keep a track of the loopholes in your capital. While going to an investor, show them the accounts and logistically present the number of funds required. This shall give you an upper hand.
6. A Compelling Story sounds good:
Let not your pitch-deck sound like a robot. Use it to show your team's strengths and why you are taking on this particular challenge. It's simply about getting the potential investor excited enough to put their money on the line to be a part of the story with you.
7. Funds = Bonus:
Raising a startup on the basis of bootstrapping is considered to be an ideal one. Consider the funds as the bonus. This will help you control the company completely without any pressure from the outside investors. Also, it lets you focus on your business more rather than always being in the hunt for an investor.
8. Make sure you are financially stable:
Giving up an existing job to start a venture is not quite a good thing to do. Knowing about the highs and lows of the business, ensure that all your debts are cleared. Also, make sure that the medical insurance, family savings, and credit cards are in place. Moreover, keep a minimum runway of 9-12 months. Once you have got this sorted, it will be easier for you to concentrate on your venture.
9. Gulp down that bitter pill:
It is good to accept that a startup is not working. Knowing that 80-90% of the startups get tossed over, you should not hesitate to make your call and well, move on. As a risk taker, this has to be your last resort but keep in mind that at times you need to let things go
10. Do your own research:
Talk to the alum companies if you are applying to an accelerator. Talk to the portfolio companies if you are planning to raise capital from an angel investor or probably a venture fund. Those are the best source of references you won’t read the news.
Setting up a startup involves hefty procedures and complex hurdles. We at Wazzeer can vouch for being your most reliable Legal & Accounting Partner; letting your plans align smoothly. Let’s Connect!:)