The StartUp funding Game (Series 1)

“ Ideally, entrepreneurs aren’t meant to be funding the business, their main job is to manage the business to ensure it outlives they themselves”.

(Tayo Oviosu of Paga, Techplus conference 2017).

So last week, I was talking to a friend who just started his first startup, some months into the business and currently using his personal funds for the venture, he’s seeking expansion, needing investors, even within the school campus, i’ve come to understand that the laws that govern the inflow of capital or OPM (Other People’s Money) into anything we create is VALUE.

One question to even ask is; since i’ve not launched the business how do we measure value. Personally, I measure value by the amount of relevance proposed IMPACT it would have on the lifestyle of people.

For him, the question isn’t value because he’s been dedicating so much into the success of the business and I for one had experienced his passionate love for his growing customers. Like Jeff Bezos said “the number one secret to staying in business is treating your customers like Kings”.

I’ll highlight some points which i’ve come to understand from my own entrepreneurial journey about fund raising.

  1. FUNDRAISING IS A TOUGH GAME: Raising funds is going to be tougher than you think and it’s even going to take longer than you think, you need to be equipped with tenacity, and clarity as you go along.

You’re good when you can explain your vision in a single page, you’re better when you can explain it in one paragraph, but you’re a legend when you can explain your entire vision in less than 140 characters.

Clarity is KEY. Expect a lot of Nos’ but that’s not to say your idea and company isn’t going to be cutting edge if you don’t stop improving.

And I’m not a believer in the philosophy that your first business must fail, I don’t know Bill Gate’s First business or Jeff Bezos’ first business or even Elon Musks’, but i’m sure you shouldn’t settle for lies about failing at it the first time, of course you will need to evolve or else you will die.

2. THERE IS ENOUGH TO GO AROUND: As you go along, thoughts about exhausting all available investors might come to play but don’t fall for it. Only a small amount of businesses eventually get funding and it can be easy to conclude that there are shortage of investors, and also investors believe that there is a shortage of good companies to invest in and are actively looking for the next sexy company to invest their funds. So get the attention of everyone, stay in the light. let your achievements regardless of how little they may be stay in the light and try as much as possible to be known outside your circle. So my advise to you is:

You are the light of the world. A city on a hill cannot be hidden. Neither do people light a lamp and put it under a basket. Instead, they set it on a lampstand, and it gives light to everyone in the house… (Holy bible, Mathew 5:14)

3. THE POWER OF PR: One of the most recent industries to directly start using Public Relations are the ICOs (Initial Coin Offerings) on the blockchain technology network, the model of raising more than $100M (Yes, Hundred Million Dollars) in less than 30 days without having a single traction. Sometimes to raise money you will need to advertise your product to ‘non-potential’ investors and then you need to market the need to raise money to everyone, the world is changing, everyone is now literarily connected in this cognitive world. and one secret is that most people want to be a part of anything that would make lives better. Let people know you want to raise money, who knows?

I might know someone, that knows someone, who knows someone, that knows some other person, who can like to invest some money in your business, you get the logic.

4. NO TRACTION, GOOD LUCK: If you need to raise money, the first question is; have you bootstrapped your company yet?, I was thinking about some limiting factors that hinders investors from putting their money in startups, like it or not the first thing is TRUST!

So what comes first to you? getting money into the business or getting money into your pocket. You can prove this by doing what few startups have dared doing… keeping a open sales sheet, transaction sheet and even account statement. Making mistakes is essential and a part of the journey, being open about them means you have the potential to be responsible and accountable, hiding your mistakes and seeming like a perfect-growing business will only make investors put you in the class of others startups “ we are looking to see how they play out ”. See traction has “Proof-Of-Work” and for every POF, you will get rewarded with external cash, sooner than later.

What comes first to you ? Your pocket or the Business.

5. WHO CARES?: Absolutely NO ONE but you, the market doesn’t care, Investors don’t care, Customers don’t care, wait! care about what? Care about the challenges you’re going through right now and those waiting for you in the future, or about how difficult it has been, or about the journey, what they need is numbers, duration, game plan and RETURNS. Investors and everyone that is not an investor would never give you funds out of sympathy, let the value of your creation speak, let your tenacity speak and let your undying drive to see the business succeed speak.

In the second series, i will discuss the type of financing deals that could be suitable for you regardless of what stage your business might be, the third series would list some angel investors and venture Capital options you have (For African Startups) and strategies to get your desired funding.

Credit: Matt Jones

If you learnt anything from this write up. you can share with your circle, someone might know someone who knows someone that needs to read this. I’m also on twitter and Instagram as @realcking. Also follow to know when the next series are published.

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Christopher KING ®

Written by

Enterprise Investor - founded, @btdmultiglobal & @tiatradinghouse are 2 of 500. Jesus,Tech & Family. CHANGE THE GAME!

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