3 Tests Entrepreneurs Must Pass To Crowdfund Their Startup
Many tech startups in Singapore hear the call to FundedHere, but few are chosen. Before getting funded, every startup has to pass strict compliance filters. Below are three of the most common pitfalls:
1. Simply too young: early stage doesn’t mean idea stage
It takes more than a good idea to succeed — you also need proof of concept to instil confidence in investors. With so many startups jumping the gun before they can realise their full growth potential, FundedHere requires companies to have been incorporated in Singapore for at least a year before raising capital through the platform.
Is your startup ready for the next stage? Here are some factors to consider if you want to make the cut:
- Is your business scalable? — What solutions has your business put in place to support its growth? Online businesses have disrupted traditional ones by providing services to the masses. These models have great growth potential yet do not require a significant increase in cost base.
- Do you have unique IP? — This edge will provide a barrier to entry for other and allow market share to be captured quickly which is essential in the early growth phase. Developing your IP before funding will distinguish you from your competition and make you more attractive to investors!
- Do you have a focussed strategy? — Identify the next steps and challenges ahead of you before asking for funds. Startups that vaguely ask for working capital leave investors uncertain about whether the requested amount will reap results.
2. Setting up shop: To get FundedHere, get incorporated here first
Startups should consider where to plant their roots before branching out into new territories. Singapore is known throughout South-East Asia for its strong legal framework and financial systems; for instance, Singapore is ranked fourth in the world and top in Asia for IP protection.
Seeking to raise funds on FundedHere? All applying startups must be Singaporean and have their intellectual property trademarked here in Singapore. This protects both investors and entrepreneurs in the event of a default or dispute.
3. Inactive founders, get involved!
During and even after the early stages, a startup’s most valuable asset is its leadership.
The world’s most iconic entrepreneurs didn’t build an empire by taking a backseat. Today’s household names like Mark Zuckerberg, Oprah Winfrey, Steve Jobs and Jack Ma are all known for being driven, hands-on and hungry!
Founding members should not only have a job title but a strategic role in the company. A founder’s commitment to the business’s financial success is a fundamental requirement for startups seeking to fundraise through our platform.
While these are just some compliance issues we encounter, there are many other factors to take into consideration before deals are on-boarded to the platform. With years of experience in capital markets and compliance under their belts, the FundedHere team is passionate about supporting the most promising start-ups in Singapore and throughout South-East Asia.
If your startup meets the criteria above or you would simply like to find out more, please give us a call at (+65) 6443 3063.