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PixabayNeed to find investors to launch a startup or scale your business? There’s more than one way to approach fundraising and to get noticed by those with the capital you need to get to the next level.
No matter how great your product or business idea, how lean you can operate, and how big you’ve grown already, more capital and financial leverage will almost inevitably be a necessity. Even the best funded and hyper-successful billion dollar startups have been engaging in more fundraising rounds than ever before.
As I describe in my book, The Art of Startup Fundraising, having enough working capital and runway to get to your next milestone is vital for giving your business the chance to live to its full potential.
Of course, the chances of receiving a random call from some super-sized venture capital firm or the producers of Shark Tank are pretty small. Especially, if you haven’t already attracted some well connected investors. Thankfully, for today’s entrepreneurs, I’ve seen an increasing number of ways startups are getting noticed, found and are connecting with potential investors.
If you haven’t landed the money you want for your next series yet, consider these options and then share a great pitch deck with interested parties to convince them of the potential of your business. If you need guidance,the pitch deck template by Silicon Valley legend Peter Thiel is a great example of simple story telling in slides to help you get funded (see it here).
1) Online Fundraising Platforms
The past five years have given birth to virtually countless online fundraising platforms. They have become highly popular with sophisticated and accredited individual investors, angels, and even banks and funds looking for new ways to deploy capital.
The major platforms run from peer-to-peer lending sites which offer business loans to donation based, debt and equity crowdfunding portals.
For donations you can try Kickstarter or Indiegogo. For equity crowdfunding platforms the most popular platforms are the following:
Even if you don’t use online platforms to raise all the money you want, they can be powerful for getting noticed. The key is finding the right match in a platform for your venture and needs, as well as being realistic about what it will take to make a campaign work.
2) Events
Success in business and fundraising is all about visibility, getting noticed by the right investors, who you know, and who knows you. Attending events is a great way to achieve this. Try to find out who is attending the event ahead of time and schedule meetings to be productive.
This can be pitch nights for presenting your own opportunity and meeting active investors who are there, engaging in coding marathons, or simply getting out to organized networking functions and industry trade shows.
If you are operating an early stage company, you may want to consider attending any of the following events:
•SXSW
To get ahead of the competition and take a more passive route, consider attending other events where your investors are likely to be. Think sporting events, charity fundraisers, film festival and yacht shows.
3) Social Media
Social media can be your best friend as a lean startup or solo entrepreneur looking to test the market, gain traction, and attract investors. It makes it easy to be discovered, and is still one of the most cost effective methods of reaching others.
You can take an inbound approach with your own posts and updates, or take a more active approach with collaborations and leveraging sponsored posts or influencers.
Direct messaging can be powerful too. If you can get the social profile handles of well fitting investors, it might only take one great message to connect with the capital your startup needs. If this sounds like a fit for you, check out this Forbes article with the LinkedIn contact information for the top 50 angel investors based on investment volume.
In the event you need VCs you can always go to Crunchbase and research for those investors that are actively investing in your industry. I recently covered some of the most active funds in this piece on Forbes.
When it comes to social media, here are the most popular channels and how to use them:
•LinkedIn for cold messages or to seek quality introductions to pass the social proof with guarded investors such as Venture Capital investors. In my opinion, LinkedIn Premium is totally worth for unlocking certain features.
•Facebook for meaningful relationships after you have been able to meet with an investor once or twice. It is critical to build the relationship to generate trust.
•Twitter for thoughtful conversations and engagement with relevant information shared by the investor
4) Blog
Blogging is one of the most underestimated methods of attracting inbound attention, telling your story, progressing potential investors through the thought process of wanting to invest in you, and remaining visible through each series of fundraising. Even without a website or blog of your own yet, you can publish via Medium or LinkedIn.
Moreover, another good option is to go to the blogs of the investors that you are looking to target. They all read their comments and often engage with responses. Leave a thoughtful comment to get noticed and start building the relationship from there.
Investors that are probably the most active right now on blogs include:
5) Email
Simple emails have proven to be able to get the attention of notable angel investors and VCs. They’ve even be responsible for the launch of some very important and notable startups. Here are 3 Proven Email Templates That Helped Entrepreneurs Raise Millions.
6) Apply to Accelerators
Popular startup accelerator programs always have an open invitation for applications from serious entrepreneurs. If accepted, you’ll likely get a modest check to keep developing your work, as well as introductions to other investors, business advice and help in staging future fundraising rounds. Just make sure you know the terms and look for a good fit before you apply, or accept the help.
Typically Accelerator programs include a demo day. This is when the startups attending the program pitch to a crowd of investors. I listed recently the ones to highly consider in the piece 10 Startup Accelerators Based on Successful Exits.
In the event the accelerator that you are considering is outside of the list included in the piece above, I would highly recommend to do extensive research to verify the type of success stories and the track record from such program. You may be better off using that equity that you intended to allocate to the Accelerator to create instead a very active board of advisors and incentivize them to help with making investor introductions.
7) Start Sharing Your Product
Fundraising and growth needs to be strategic to be successful. Yet, far too many entrepreneurs and startups aren’t focusing enough on just getting their product or service out there in the hands of customers, influencers, and in turn, in front of investors.
If you can acquire real customers, you will be under less pressure to seek outside money. When you do, you can achieve better terms, from better investors.
If sales are tough, then there are freemium and hybrid business models that can help get your product in the market, and starting to generate some buzz.
